Video compression is essential for home entertainment. Without it, we'd be stuck in a world with just a few dozen TV channels. Since digital was first introduced in the UK, we've had compressed TV - it's a really great way of getting a lot more out of the broadcast capacity we have, and it's why we went from five terrestrial TV channels to more than 30.

But, current compression schemes like h.264 - or MPEG-4, as it's known - are still not as efficient as they could be, which is why we're now seeing the introduction of High Efficiency Video Coding (HEVC or h.265). Right now, h.264 is hugely popular and used by the likes of Apple for its iTunes movie and TV downloads and it's also the codec used by Sky and Freeview for HD TV services. 

What h.265, HEVC adds is a compression system that can reduce the capacity needed for 1080p video by as much as 50 per cent - actual percentages might be in the mid-30s. This will allow streaming video to increase in quality, without using more of your precious internet bandwidth, and for Blu-ray and TV broadcasts to take advantage of 4K video and perhaps higher-quality 3D.

As we move to 4K and 8K resolutions, the efficency of codecs becomes more important to ensure it's possible to broadcast that content

At this point, it's worth explaining how video compression has changed over the years. Our, now largely redundant, analogue TV standard (PAL) uses 25fps, but to save bandwidth those 25 frames are stretched out to 50 half frames, or fields. This technique is called interlacing and is a form of temporal compression. It works by creating two fields which each contain half the total picture. That form of compression is clever, because it doesn't really reduce the amount of information sent, but it reduces the amount being sent at any one time. This is important, because it allowed analogue TV to fit into a restricted 6MHz of broadcast spectrum. The way your eye, and particularly ow CRT TVs worked, meant it was never really obvious that it was happening.

Digital compression is a lot more sophisticated. It looks at each frame of video, works out what moves and what does not and uses this information to compress the video. Shoot a scene where a person walks across a static frame, and this is easy to compress. Put simply, the encoder will understand that 90 per cent of the scene doesn't change from frame to frame, so only pays attention to the changes. It's much more complex than that, obviously, and if you're interested, there are plenty of white papers online that explain it in much better detail.

The actual differences in how h.265 encodes video over h.264 are reasonably small, and the principals, at least, are the same. The changes make it practical to encode larger frame sizes, like 4K2K and even 8K4K. The upshot is that full HD video could soon, realistically, be done in 3G bandwidth. But it's also going to be big news for the likes of Netflix, which demoed 4K streaming at CES this year. It's likely years off, but the idea of sending 4K over internet connections could render the whole point of broadcast TV as pointless, not to mention disc-based formats, which have been on the wane for a while now.

Delivery of high-definition material over 3G and 4G is also important, especially for those who don't have access to a fast, fixed-line service. That includes parts of the UK, but also across Africa, where it's very likely that there will never be a fixed line infrastructure in many of the countries on that continent. It's also exciting to think that perhaps one day soon we'll stream 1080p video to our phone, then wirelessly mirror it to our TVs with no need for other expensive hardware.

So HEVC is the next step, and will almost certainly become popular very quickly. Specifically, Blu-ray needs a new codec to allow it the capacity for 4K. As always, this will need new players, but the good news is that it will also likely be paired with a jump to larger Blu-ray discs. Even while Blu-ray was being launched, it was clear that in the future there would be 100+GB discs coming. These would likely be incompatible, but if you're buying a new player to use HEVC, then why not also jump to a more modern version of Blu-ray too.

Panasonic's 4K OLED screen will need some 4K material to feed it, perhaps it will be delivered via the internet?

In fact, there hasn't been much from the Blu-ray Disc Association on the subject of 4K. We asked Panasonic at CES if that was the direction in which the firm was going with 4K to support its OLED screen, but it said it was up to the disc association, what happened with the format. It's clear, however, that this is one very good way of getting 4K video to consumers, although appetite for another upgrade is likely to be small, especially given Blu-ray's comparative low sales compared to DVD.

Of course, the downside to new codecs is that they're not easily supported on most hardware. The more efficient the codec, the more processing power it generally requires and that means that, even with a firmware update, current set-top-boxes and Blu-ray players won't be able to play content encoded with HEVC. When it comes to computers, this isn't an issue, as most modern machines will have the power needed to handle the format, especially with players that leverage the GPU to perform hardware decoding.

Another downside is that no matter how efficient your video encoder, audio is now the thing that takes up masses of space. With HD audio that is a bit-for-bit replica of the studio soundtrack, video is actually the easier side to deal with. While Dolby Digital can be quite compact, step up to DTS and you'll see a size jump in the audio file size; move to Dolby TrueHD or DTS HD MA and you'll see the size of the combine files go through the roof. Of course, Dolby Digital has always sounded amazing, so in streaming services, the move to HD audio might be further away than the move to high-quality 1080p video.

It might be a long time until you see HEVC/h.265 in the flesh, but it seems to us like it's going to be a big deal, perhaps even more so than h.264. If it's used in tandem with the slowly increasing broadband speeds in the UK, we could see people on slower connections get video that rivals any over-the-air broadcast. That will give everyone access to a potentially unlimited library of material. Existing broadcasters may find that it's cheaper for them to ditch broadcasting, and move to an online model.

Change like that doesn't happen overnight, and until everyone in the UK has decent bandwidth, there's no way any broadcaster is just going to give up on that tried-and-tested system. Hopefully though, h.265 will make 4K and 8K broadcasts a real possibility, and while you'll need new hardware, there's a good chance that your next TV will have it all built in. Maybe even your mobile phone.