How AV1 Works
AV1 is a modern video codec, the compression method, not a file format, and it was built to be the most efficient codec that is also completely open and royalty-free. Like other modern codecs it is a block-based hybrid design: it partitions each frame into superblocks and recursively subdivides them, then applies intra and inter prediction, transform coding, and entropy coding to compress the result. What sets it apart is the breadth of tools it brings, more prediction modes, larger and more flexible block partitions, and advanced techniques for handling motion, that together squeeze more quality out of every bit.
The practical result is leading compression efficiency: AV1 typically matches or beats HEVC (H.265) at the same quality, and substantially outperforms the older H.264, often by 30 percent or more. That means smaller files and lower streaming bandwidth for the same picture, which at scale, across millions of streams, translates into enormous savings. This efficiency is the entire reason a consortium of major companies invested in building it.
AV1 video is carried in containers rather than used as a loose file: most commonly inside WebM or MP4 on the web, and it also underpins the AVIF image format, which stores a still picture as a single AV1 keyframe. So when you encounter AV1, it is as the compression inside a web video or a next-generation image, not as an .av1 file you handle directly.
Open and Royalty-Free by Design
AV1's defining feature is its licensing, or rather the deliberate lack of licensing fees. It was developed by the Alliance for Open Media, a consortium including Google, Mozilla, Netflix, Amazon, Microsoft, and others, specifically to provide a high-efficiency codec free of the patent-royalty problems that constrained HEVC. Because anyone can implement and ship AV1 without paying license fees, browsers, platforms, and hardware makers have been able to adopt it freely, which is exactly what HEVC's licensing prevented on the open web.
This is why AV1 has spread quickly where it matters most. YouTube, Netflix, and other major streaming services use it to cut bandwidth, modern browsers support it, and newer hardware increasingly includes AV1 decoding. It is positioned to become the dominant codec for efficient, license-free video, achieving HEVC-level results without HEVC's legal and financial baggage.
When to Use AV1
AV1 is the right choice when efficiency and openness both matter and your audience has modern hardware: streaming or storing video where bandwidth savings are valuable, web delivery where a royalty-free codec is preferable, or any pipeline already built around open formats. Because decoding is demanding on older devices and encoding is slow, it is less suited to situations needing universal compatibility today, where H.264 in MP4 still wins, but for forward-looking, high-volume video it is increasingly the codec of choice.
Limitations
AV1's main practical limitations are about compute and hardware maturity. Encoding is slow and demanding, far heavier than H.264, which is why it is used most by large platforms that can afford the processing. Hardware decoding, while growing fast, is not yet as universal as H.264's, so on older devices AV1 playback can rely on software decoding that uses more battery and CPU. And like any cutting-edge codec, support outside modern browsers and recent hardware is still catching up. These are transitional issues, the efficiency and royalty-free licensing are exactly why AV1 keeps gaining ground.
