The text could hardly be clearer: you do not have a license for commercial use of H.264. Call it “Final Cut Pro Hobbyist”. Do you post videos on your website that has Google Adwords? Do you edit video on a consulting basis? Do you want to include a video in a package sent to your customers? Do your clients send you video clips as part of your business? Then you’re using the encoder or decoder for commercial purposes, in violation of the license.
This last thing is actually a particularly interesting point. If you encode a video using one of these (open-source) unlicensed encoders, you’re practicing patents without a license, and you can be sued. But hey, maybe you’re just a scofflaw. After all, it’s not like you’re making trouble for anyone else, right? Wrong. If you send a video to a friend who uses a licensed decoder, and they watch it, you’ve caused them to violate their own software license, so they can be sued too.
Unisys was asking some web site owners $5,000-$7,500 to able to use GIFs on their sites. Note that these patents expired about five years ago, so this isn’t an issue today, but it’s still instructive. It’s scary to think of a world where you would have to fork up $5000 just to be able to use images on a web site. Think about all of the opportunity, the weblogs, the search engines (even Google!) and all the other the simple ideas that became major services that would never have been started because of a huge tax being put on being able to use a fundamental web technology. It makes the web as a democratic technology distinctly un-democratic.
We’re looking at the same situation with H.264, except at a far larger scale.