Digital video compression/decompression algorithms (codecs) are at the heart of many modern video products, from DVD players to digital video recorders, multimedia jukeboxes, and video-capable cell phones. Understanding the operation of video compression algorithms is essential for developers of embedded systems, processors, and tools targeting video applications. For example, understanding video codecs’ processing and memory demands is key to processor selection and software optimization. In this paper, we explain the operation and characteristics of video codecs and the demands codecs make on processors. We also explain how codecs differ from one another and the significance of these differences.