Attached Link: http://www.divx.com

Most people prefer DivX, which in my experience is by far the *least* lossy. It also yields the smallest file sizes that I've seen. You'll have a lot of settings choices to work with, some yield smaller files than others. The basic version of DivX is free, so you can experiment for awhile before upgrading to DivX Pro. Xvid is another name that has been popping up a lot lately with a positive reputation. I have the free version for viewing, I'm not sure if you need to pay for encoding options. AC3 seems to be the most popular soundstream compressor for .avi at the moment. Indeo is no longer your best option. I'm not crazy about the Microsoft codecs, either.