The Streaming War's Hidden Front: Patent Tolls Rise for Disney

MUNICH, Germany – November 24, 2025

The battle for streaming dominance is typically waged with exclusive content and aggressive pricing, but a far quieter, more technical front has just seen a major escalation. In a Munich courtroom, The Walt Disney Company was handed its second injunction in a month, compelled by a ruling that it has been infringing on foundational video streaming technology owned by research and development firm InterDigital.

The decision, which Disney can appeal, specifically targets the entertainment giant's use of High Dynamic Range (HDR) technology, the very innovation that delivers the vibrant, cinematic picture quality central to the Disney+ viewing experience. This German ruling is not an isolated event but the latest victory in a calculated, global legal campaign by InterDigital, underscoring a critical business reality: the pipes that deliver the content are just as valuable as the content itself. For Disney and other streaming giants, it's a stark reminder that the cost of innovation often comes with a licensing fee attached.

A Global Legal Chess Match

While the latest news comes from Munich, InterDigital's offensive against Disney is being fought on multiple continents. The R&D firm, which develops and licenses foundational technologies for wireless, video, and AI, initiated a barrage of lawsuits in February 2025 after it says licensing negotiations that began in July 2022 proved fruitless. The legal battle now spans the United States, Brazil, and multiple courts in Europe.

This second German injunction follows a similar ruling on November 3, 2025, from the same Munich court, which found Disney infringed on a separate InterDigital patent for dynamically overlaying video streams, a technology essential for features like subtitles. Before its success in Germany, InterDigital secured a preliminary injunction in Brazil on September 11, 2025, where a court found Disney's services infringed on patents related to crucial AVC and HEVC video coding standards.

"This decision is another example of how Disney continues to use our technology and infringe our intellectual property without a license, for free," said Josh Schmidt, Chief Legal Officer at InterDigital, in a statement following the latest ruling. His comments frame the conflict as a straightforward case of fair compensation for innovation.

Disney, however, has not taken the assault lying down. In August 2025, the media conglomerate launched a preemptive strike in the U.S., filing an antitrust case against InterDigital that alleges "abusive licensing practices." This move highlights the inherent tension in the industry between implementers of technology, who seek to minimize costs, and the R&D firms that hold the patents and depend on licensing revenue for their business model. The U.S. Department of Justice has even weighed in, filing a Statement of Interest that advises caution in how antitrust law is applied to disputes over standard-essential patents, signaling the complexity and high stakes of the case.

Germany: The Patent Holder's Hammer

InterDigital's repeated success in Munich is no accident. Germany has cultivated a reputation as a preferred venue for patent holders seeking to enforce their intellectual property, primarily due to its unique "bifurcated" legal system. In this system, questions of patent infringement and patent validity are tried in separate courts and on different timelines.

This separation allows infringement cases to proceed much more quickly, often resulting in an injunction for the patent holder before the corresponding validity case is even heard. For a defendant like Disney, this creates immense pressure. An injunction in Germany means the company may be legally barred from offering its streaming services using the contested technology within one of Europe's largest markets.

While German law includes a "proportionality test" that could theoretically limit an injunction if it causes "disproportionate hardship," legal experts note this is an "absolute exception" and rarely applied. The burden is on the infringer to prove such hardship, and courts generally presume the patent holder's right to exclusivity prevails. Once a court like the Munich Regional Court grants an injunction, it can be enforced as soon as the plaintiff (InterDigital) posts a security bond, putting the defendant's operations at immediate risk. This legal framework effectively turns the German court system into a powerful lever for patent holders to bring reluctant licensees to the negotiating table.

The High Cost of Cutting-Edge Content

For consumers, the magic of streaming is its apparent simplicity: click a button and a high-resolution movie appears. For the companies providing that service, the reality is a complex and costly technological tapestry woven from thousands of patented inventions. The current dispute over HDR and video compression patents lays bare these hidden costs.

InterDigital's business model is built entirely on monetizing its vast portfolio of such patents. The company doesn't make consumer products; it funds extensive research and then licenses the resulting innovations. This model is highly profitable, with InterDigital reporting an operating margin of 54.5% in early 2025. The company's recent legal wins and new licensing deals have bolstered its financial outlook, with projected annualized recurring revenue hitting a record $579 million and a full-year 2025 revenue forecast revised upwards to between $790 and $850 million. These figures demonstrate the immense market value embedded in the technologies that power modern digital life.

For Disney, the financial calculus is now stark. The injunctions in Germany threaten a key market, and the ongoing litigation creates uncertainty and legal costs. The likely endgame for InterDigital is not to permanently block Disney+ in Germany, but to force Disney to sign a multi-year licensing agreement that reflects the value of the technology. This would represent a new, significant operating cost for Disney's direct-to-consumer segment, which is already under intense pressure to achieve profitability.

A Blueprint for the Broader Tech Landscape

The InterDigital vs. Disney battle is a microcosm of a larger dynamic playing out across the technology and media landscape. It pits a "patent powerhouse," a pure-play R&D company, against a "content king," a vertically integrated media giant. As more industries become digitized and reliant on standardized technologies—from 5G in automobiles to video codecs in entertainment—conflicts over intellectual property are becoming more frequent and more consequential.

The video streaming sector, in particular, is a hotbed of patent activity. As companies race to deliver higher quality video (4K, 8K, HDR) more efficiently, they inevitably rely on a bedrock of patented compression and delivery technologies. Recognizing the potential for endless litigation, some industry players are coalescing around patent pools, such as Avanci Video and Access Advance, which aim to offer a one-stop-shop for licensing essential video patents.

These pools provide a potential pathway to simplify licensing, but the participation of major patent holders like InterDigital is not always guaranteed. Companies with particularly strong or foundational portfolios may conclude they can secure more favorable terms through direct negotiation, using litigation as a tool to underscore the value of their IP. As Disney is now discovering, the price of admission to the cutting edge of streaming is being set not just in the marketplace, but in the courtroom.

The outcome of this global dispute will have ripple effects, potentially setting a new benchmark for the licensing fees associated with core streaming technologies and influencing the strategies of other content distributors who have yet to settle their own IP accounts.