They are supposed to be, but Disney doesn't think so: https://arstechnica.com/gadgets/2026/03/av1s-open-royalty-fr...

Also, let's not forget that the majority of devices still don't have AV1 hardware decoding support. For example, Apple only recently (2023) added support with iPhone 15 Pro and M3 Macs.

They have been created with the express purpose of avoiding incidents like this.

Instead of paying the ransom, a streaming company should transcode their movies to a royalty-free format, like AV1 or VP9.

Even big companies like Dell have preferred to disable the H.265 codecs in the computers they sell, instead of accepting similar demands for greatly increased royalties, and I think that it was the right choice.