“CompuServe released [image file format format] GIF as a free and open specification in 1987. GIF soon became a world standard, and also played an important role in the internet community. It was well supported by CompuServe’s Information Service, but many developers wrote (or acquired under license) software supporting GIF without even needing to know that a company named CompuServe existed. GIF was relatively simple, and very well documented in books, articles and text files.
GIF images are compressed to reduce the file size. The technique used to compress the image data is called LZW (after Lempel-Ziv-Welch) and was first described by Terry A. Welch in the June 1984 issue of IEEE’s Computer magazine. Unisys [once a well-known computer company with a long history] holds a patent on the procedure described in the article, but the article describing the algorithm had no mention of this. The LZW procedure was simple and very well described, and it soon became a very popular technique for data compression (just as GIF would become a standard in its own field). It appears that neither CompuServe, nor the CompuServe Associate who designed GIF, nor the computer world in general were aware of the patent....
At the end of December 1994, CompuServe Inc. and Unisys Corporation announced to the public that developers would have to pay a license fee in order to continue to use technology patented by Unisys in certain categories of software supporting the GIF format. These first statements caused immediate reactions and some confusion.” From The GIF Controversy: A Software Developer’s Perspective.
“[Currently,] Unisys is charging web sites $5000 or more... if the software originally used to create the GIFs was not covered by a Unisys license.... The catch is that it appears to be difficult or impossible to get a Unisys license to use LZW in free software that complies with the Open Source Definition or in low-volume proprietary software. [Instead, Unysis requires a yearly license fee directly from Web site operators.] The fact that Unisys was able to patent LZW is due to a flaw in the US patent system that makes even pencil-and-paper calculations patentable.... However, Unisys’s actions are legal under US law, so the only reasonable alternative to paying the ‘Unisys tax’ on the web is to upgrade graphics from GIF to PNG format, or MNG format for animations.” From Burn All GIFs.
Burn All GIFs is a campaign encouraging Web developers to stop using the GIF format. Burn All GIFs also promotes Burn All GIFs Day to both further the campaign and to protest Unisys’s licensing practices. Burn All GIFs is a project of the League for Programming Freedom, an organization that opposes software patents and user interface copyrights.
PNG is a lossless image compression format that is free from patents and royalties. It also compresses better than GIF, supports interlacing, and true alpha transparency. It became a W3C standard in 1996 and is supported by most browsers (though some have not implemented full alpha transparency.) You can convert your GIFs to PNGs with some of the tools listed here.