Google’s announcement that they are making their WebM VP8 video codec an open-standard codec without any associated license fees sent immediate ripples through the entire video industry. One key beneficiary may be Intel, whose line CE4100 of processors along with TI’s DaVinci line may be the only ready-to-ship set-top-box chips that can be upgraded to support WebM via software.

According to Stephen Froehlich, senior analyst for IMS Research, “Both of the processor families have been slow to penetrate the set-top box market, and while WebM is an important short-term opportunity for the ARM9-based DaVinci, it is a key strategic foothold for the x86-based Intel chips in the set-top box market, where x86 code is essentially nonexistent at the moment.

Froehlich continues, “While even Intel appears to have been caught somewhat off-guard by the timing of the WebM announcement, VP8 is ‘supported up to 720p as a soft codec on the Atom core’. The DaVinci processors, on the other hand, are part of TI’s OMAP family of DSP-based video decoders, and TI would benefit substantially if the uncertainty about which codecs to support persists.

According to other HD MPEG-4 AVC chip manufacturers, the mainstream “hard wired” chips that dominate the market for set-top boxes, Blu-ray players, and Internet TVs will need “additional functional blocks” to support WebM. This means that new versions of the chips will need to be designed and tested to add WebM support. IMS Research expects to see samples of hardwired MPEG-4 AVC chips with WebM support within 6 months and the first volume shipments within a year.

Froehlich concludes, “While a year is a small window of opportunity in this market, it provides a key opening for Intel to move the x 86 code libraries beyond DISH Network and into the truly massive market of mid-sized operators that can’t afford custom solutions. As device manufacturers can always disable WebM support to avoid any patent liabilities, we expect demand to be strong for hardware-level support of WebM as long as it is in use at Google.”