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"MPEG" Definition:
A multimedia video format. MPEG is both a file format and a codec for digital video. There are actually three forms of MPEG: MPEG video, for picture only; MPEG audio, which is discussed in the previous section; and MPEG systems, which includes both audio and video tracks.
MPEG files provide excellent picture quality but can be very slow to decompress. For this reason, many MPEG decoding systems are hardware-assisted, meaning that you need a board to play MPEG files reliably without dropping a lot of frames. Although software decoders definitely exist (and there are some very good ones out there), they tend to require a lot of processor power on your system and also usually support MPEG video only (they have no soundtrack).
A third drawback of MPEG video as a standard for the Web is that MPEG movies are very expensive to encode. You need a hardware encoder to do so, and the price ranges for encoders are in the thousands of dollars. As MPEG becomes more popular, those prices are likely to drop. But for now, unless you already have access to the encoding equipment or you're really serious about your digital video, a software-based format is probably the better way to go.

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