[Pxtl]

Indeed. I'm disappointed that the new generation of codecs (h264/webM) has won out for small internet videos because they seem to be processing-power beasts.

Full-screen mpeg-2 (DVDs) was doable with a $40 device over a decade ago. Video compression is definitely a worse-is-better space.

[dtech]

The heavier use of CPU allows the files to be smaller while retaining quality (or vice-versa).

As all current platforms, including mobile because of dedicated hardware, have absolutely no problem with playing H.264 video while bandwidth is still a scarce resource I think it is logical and wise that H.264 won over MPEG-2 or other older codecs.

Don't forget that larger file size also might mean more power consumption (storage and radio need to be active longer) even if less CPU is consumed.