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MPEG-4 is one of the latest video/audio compression method standardized by MPEG group, designed specially for low-bandwidth (less than 1.5MBit/sec bitrate) video/audio encoding purposes.

MPEG-4 is designed to deliver DVD-quality video (MPEG-2) at lower data rates and smaller file sizes.

It should be noted that unlike MPEG-1 and MPEG-2, the MPEG-4's predecessors, MPEG-4 itself isn't just one unified encoding mechanism, but rather a group name for several flavors of video and audio encoding methods that share certain same characteristics. These "flavors" are often referred either as "profiles" or "layers" in MPEG-4 compression scheme and each new profile should be backwards compliant to the older, "lower" versions of MPEG-4 in terms of playback capability.

Probably the best-known MPEG-4 video encoders are called DivX and XviD, which both are nowadays fully standard-compliant MPEG-4 encoders. The most common MPEG-4 profiles that both XviD and DivX use extensively are called "simple profile" and "advanced simple profile".

Beside those two standardized video encoding profiles, the MPEG-4 group has standardized several other profiles. The most important ones are H263+ (which is used widely in mobile phones, dubbed as 3GP) and H.264 (often also called as AVC or more technically known as MPEG-4 Part 10).

Since MPEG-4 is a container format, MPEG-4 files may contain any number of audio, video, and even subtitle streams, making it impossible to determine the type of streams in an MPEG-4 file based on its filename extension alone.

The official filename extension for MPEG-4 Part 14 files is .mp4, thus the container format is often referred to simply as MP4. However various file extensions are also commonly used to indicate the content inside the MP4 container:

• MPEG-4 files with audio and video generally use the standard .mp4 extension.
• Audio-only MPEG-4 files generally have a .m4a extension. This is especially true of non-protected content.
• MPEG-4 files with audio streams encrypted by FairPlay Digital Rights Management as sold through the iTunes Store use the .m4p extension.
• Audio book and podcast files, which also contain metadata including chapter markers, images, and hyperlinks, can use the extension .m4a, but more commonly use the .m4b extension. An .m4a audio file cannot "bookmark" (remember the last listening spot), whereas .m4b extension files can.
• Raw MPEG-4 Visual bitstreams are named .m4v.
• Mobile phones use 3GP, a simplified version of MPEG-4 Part 12 (a.k.a MPEG-4/JPEG2000 ISO Base Media file format), with the .3gp and .3g2 extensions. These files also store non-MPEG-4 data (H.263, AMR, TX3G).

The common but non-standard use of the extensions .m4a and .m4v is due to the popularity of Apple's iPod, iPhone, and iTunes Store, and Microsoft's Xbox 360 and Zune. Without mods, Nintendo's DSi and Sony's PSP can also play M4A.