The first video compression standard capable of compressing entertainment video at acceptable quality was MPEG-1, published in November 1992. MPEG-1 has been used for video distribution on the web and on compact disc (Video CD). MPEG-1 was followed by MPEG-2, developed jointly with ITU-T and published in November 1994, used for broadcasting and video distribution on DVD. The third video compression standard was MPEG-4 Visual published in October 1998 used for for video distribution on the web and for mobile telephony.
In the second half of the 1990s several proprietary video compression algorithms began to appear. Two of the most famous were from Real Networks and from Microsoft. The latter was standardised by SMPTE as VC-1 in April 2006. In the following years more proprietary video compression formats were deployed. Two of the most famous were Dirac from BBC, standardised in January 2008 by SMPTE as VC-2 and the On 2 format by On 2 Technologies (now part of Google since the company was acquired in February 2010).
In 2001 MPEG teamed with ITU-T to develop the AVC video compression standard published in April 2003. AVC has found use in a large number of application domains. Two extensions of the basic AVC compression format – SVC for scalability and MVC for multiview – have also been produced. MPEG is currently engaged, again with ITU-T, in the development of the new HEVC video compression standard, planned for release in January 2013.
One of the first claim made by the owner of a proprietary video compression standard concerns compression capability. Unfortunately such claims are easy to make but hard to prove because the claim highly depends on the testing environment. MPEG has defined the testing environment for its video compression standards as the result of an open process trying to accommodate different views and requirements. The results of the test have been published with the definition of the testing environment. A unilaterally designed testing environment is typically unreliable.
A great deal of research has been poured into video compression since the 1960s and all compression formats – standard and proprietary – embed the results of those investments. MPEG has developed its video compression standards seeking to maximise performance and it can be expected that its standards include the use of patents of some participants in the group. Several patent pool administration companies have been set up to manage the economic rights of patent holders.
In recent years the market has begun to show an interest in video compression formats that are “royalty free”. Examples are Theora from the Xiph.org Foundation, Dirac from the BBC and WebM from Google. MPEG is responding to this trend with a standard project designed to provide a video compression standard with comparable characteristics. The standard is planned to be released in July 2013.