Theora is a free/libre video codec developed by the Xiph.org Foundation. While Theora is based on the VP3 codec developed by On2 Technologies, development has progressed since that time on the reference libtheora implementation, bringing the codec up to contemporary standards.
The advantage that Theora brings is that On2 Technologies, when they freed the source code to their VP3 codec, also granted an irrevocable, royalty free license to any patents they owned related to the Theora codec and its implementation. This, combined with the age of the original code base, puts Theora in a unique position to offer video software and hardware implementors a video codec that is not burdened by licensing fees or conditions on how it may be used.
Theora development is on-going, with implementations available for regular desktop computers, portable devices, mobile phones, and more. Please visit the website to find out more.