I knew if we simply claimed to rival or exceed the latest 'internet video' compression rates from giants like Microsoft, Real and Macromedia, that sooner or later we would have to show the goods.
So I worked in reverse. A couple of months ago, I took a music video project that I shot on DV and edited in Final Cut and started trying to compress it for use on the
www.lobecandy.com web site.
For those of you who don't know, LobeCandy Records is an independent label I started in 1994. We put out quite afew good records, many of which are available as free downloads under a Creative Common license from the web site. Load up your iPod, its AAC and MP3.
As I'm currently upload-bandwidth-challenged, I had an extra interest in making the file as small as possible. So what I did was compress the file with both MPEG-4 and MegaPEG.X, comparing results. As I tuned MegaPEG.X, I realized if I added a couple of new features, I could get us into range of MPEG-4 for this particular piece. So I added those features, and kept working at making the file size smaller. I took the audio track from the video and mastered it in SoundForge on the PC, because I have some special mastering plug-ins on the PC that I really like.
My original goal was to use MPEG-1 Layer 3 (ie. 'MP3') VBR audio, but then I discovered that QuickTime will not play MPEG-1 Layer3 audio embedded as an audio track in an ISO 11172-1 system multiplex. So I abandoned that and went back to using Layer 2, which is so well supported worldwide, well, it hurts.
In any event, I kept improving MegaPEG.X until I got within range of MPEG-4 streaming profile, and lo and behold, one day I came out with a file 2MB smaller than the MPEG-4 file. For reference, my MPEG-4 version of the movie, was about 8MB for about a 4min music video. The MegaPEG.X version ended up at 6MB.
To give the uninitiated reader an idea of how far we've come: in Dec 1998 I wrote a song and put it up on my personal web site in MP3 format. It was about 4min long and I believe I used 128K stereo CBR. The file came out to about 4-5MB. So here we are 6 years later, and I am doing both stereo audio and video at 320x240x24fps and fitting into 6MB.
Like I said, I knew that noone would believe that we had taken a 12-year old ISO standard and made it competitive with all the modern codecs, at least vis a vis the bread and butter publishing of video files on the internet. You know, the talking heads giving presentations, distance learning, product promotions, all these video forms which are not feature films or television shows.

Like I said, I knew noone would believe us, so you can take a look for yourself:
The file is available as a streaming video at
www.lobecandy.com/video.php.
I also put it up on the Digigami iDisk along with a screen grab of the actual bitrate compression profile. That's available here:
homepage.mac.com/digigami/
So this particular movie clocks in at about 200 kbps combined audio and video. But I have another compressed file 640x480x25fps that is running at 500kbps. Once I upload it, I will modify this post.
UPDATE: The 640x480x25fps 500kbps stream is available for inspection:
Digigami MegaPEG.X Samples.
If you're using QuickTime Player, the 'noise' you see on the first I-frame is actually a bug in the QuickTime MPEG-1 decoder. The actual bug is in the 'intra inverse quantizer code'. No sweat there, this bug is duplicated in just about every open source MPEG-1 playback code ever written including the berkeley source code and the MSSG code.
You can
download the demo of MegaPEG.X Pro and use the built-in bitrate/movie analyzer to check out the quality for yourself. To my eye, it looks a lot better than alot of the stuff I find on the internet. But then, I'm biased.