I thought I'd mention this nice link if you haven't seen it. Theora, when encoded with a newer Theora (Thunelsda) encoder, should at least match “MPEG-4” (in quotes, because I don't want to mention specific profiles, and get into a pissing contest).
Monty's been working on Theora and Vorbis quite a bit, and I'm pretty sure he would admit that the Theora of past didn't do justice to the capabilities of the codec.
Have fun with the surround sound work in Vorbis too :)
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This is quite impressive too:
http://people.xiph.org/~greg/video/ytcompare/comparison.html
A very interesting document, but, sadly, not dated. How old is it?
The The Matrix comparison seems to be from late 2007, the other document from mid 2009.
There's seven more pages in that series about Theora.
http://web.mit.edu/xiphmont/Public/theora/demo2.html
through to
http://web.mit.edu/xiphmont/Public/theora/demo8.html
fascinating stuff, but a bit out of date as Thusnelda is out and as Monty mentions in the surround sound link the next version has already shown a larger improvement over 1.1 than 1.1 did over 1.0
I know that some of the links are fairly old, but people might have missed the enhancements happening in Theora and Vorbis.
As for the Vorbis surround support, Monty is still working and enhancing that, so the results should be getting upstream slowly as we speak.
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