The focus of this category, transcoding, and audio conversion involves changing video and audio formats from one format to another.

Transcoding refers to direct digital-to-digital conversion of one encoding to another and may involve movie data files, audio files, or character encoding, usually because a target device does not support the file's current format, to convert obsolete data to a more modern format, or to reduce the file size. A JPEG2000 lossless video format can compress the size of movie data by as much as fifty percent, without discernable loss in quality.

However, transcoding is more commonly a lossy process, introducing varying degrees of generation loss. Transcoding from lossy to lossless format is a lossless conversion, but the process is irreversible.

Transcoding is a two-step process. The original data is first decoded into an intermediate uncompressed format, such as PCM for audio or YUV for video, then encoded into the target format.

The main drawback in transcoding is the decreased quality in lossy formats. Because compression artifacts are cumulative, transcoding causes a progressive loss of quality with each successive generation. This is known as digital generation loss and, for this reason, transcoding in lossy formats is usually discouraged.

For the re-encoding of audio into any format, as well as in digital audio editing, a master copy should be retained in a lossless format, such as FLAC, ALAC, TTA, and WavPack, which require about half the storage space than the original uncompressed PCM formats, like WAV and AIFF, because lossless formats usually include metadata options, which are limited or missing altogether in PCM formats. These lossless formats can be transcoded to PCM formats or directly from one lossless format to another lossless format, with no loss in quality. They can be transcoded into a lossy format, but this would prohibit these copies from being transcoded into another format without quality degradation.

In video editing, images are generally compressed during the recording process due to the huge file sizes that would otherwise be created, although the amount of compression used at the recording stage is variable and dependent on the quality of the images being recorded and the type of equipment available to the user. However, because video images are compressed during the recording process, any transcoding will involve cumulative image degradation. For this reason, the original recording is usually regarded as the master copy, while any subsequent transcoded versions will be transcoded from that master copy.

However, because most consumer digital cameras are real-time, power-constrained devices, transcoding video from them can reduce the data size considerably without significant loss in quality.

Transcoding is used by home theater PC software to reduce the size of disk space by video files, which usually involves the transcoding of MPEG-2 files to the MPEG-4 or H.264 format.

An audio converter is a device or a software application that converts audio signals from one format to another. Although most audio conversion is accomplished through hardware, including analog-to-digital converters and digital-to-analog converters. Some audio conversion functions can be done through software, which may convert audio data from one compressed audio format to another, such as MP3 to AAC.

The focus of this category is on the software involved in transcoding or audio conversion. In some cases, these functions are included as a module of a more comprehensive software suite and, in such cases, the site relating to the software should be listed in the category that more closely corresponds to the overall nature of the software.

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