Xvid is an open-source codec released with two major goals: openness and quality. The goal was to provide an open-source alternative to the MPEG-4 video codecs available.
The Xvid Codec provides excellent video quality with relatively low bitrates. It can be thought of as the last word in open source MPEG-4 video, where it seems to offer more features than its two commercial rivals (DivX and H.264) put together, but without the licensing worries that make open formats so desirable. The Xvid license allows for free usage of the codec so long as credit is given.
An open-source codec
One of the most essential things about Xvid is that it's open-source. There are already several Windows codecs that allow for similar benefits, but Xvid has always been free and open-source.
The big advantage here is that all future revisions don't have to be registered in order to be legally used, unlike MPEG-4 ASP (DivX, XviD). It's a very powerful codec that doesn't have the licensing worries that open source formats tend to have. This means that you can use it pretty much however you want without worrying about your actions having legal consequences.
Compression quality is very good indeed, so much so in fact, that its low bitrates and smaller file sizes have put many people off. It has a good compression/quality ratio that you can improve upon even further with some light tweaking, but as it stands, it's excellent.
Enhanced video support
Xvid has several nice features that other codecs lack. It uses advanced scene coding ‘M-V-frames’, which allows it to encode video in a refined way that is not available in any other free software, MPEG-4 or otherwise. Xvid can also handle interlaced frames by itself, and the codec has many additional features that advanced users will appreciate.
Xvid can also do scene changes, which you see when a new camera angle in a video is changed. Xvid uses B-frames to encode such changes in a more time-efficient way than MPEG-4 ASP or AVC/H.264 does.
You will find that most media players can playback Xvid files just fine. There's a very good chance that if you install Xvid, your player will be able to playback any file you have. This makes compatibility better than MPEG-4 ASP/DivX, which means it has a greater appeal to more people out there.
Xvid is the codec many people with older computers use to encode video. Its low CPU requirements and low resource usage make it an ideal codec for pretty much anyone using a regular computer without a fast processor and loads of memory. What this means in practice, is that you can encode great quality videos at tiny file sizes without needing too high of a processor and without using too much memory.
Xvid has never included any kind of malware, adware or performance-crippling features. You can always be sure that you are getting a clean codec when using Xvid. Unlike so many other codecs out there, it doesn't come bundled with any junk software either.
This means that you don't have to worry about Xvid causing any problems when encoding your videos or slowing down your computer in any way when playing back a file. Instead, it's safe and easy to use.
Xvid codec vs X264
When you compare the Xvid codec with H.264/MPEG-4 AVC, it's clear that Xvid is superior.
There is a genuine difference at lower bitrates, with Xvid able to encode video up to twice as efficient in some cases compared to H.264/AVC. While this might not matter that much when encoding videos for web usage, it could make a huge difference if you are using a portable device with limited storage space.
Excellent open-source codec
Xvid is an excellent codec with a superb development community that's making it even better all the time. While other codecs offer similar benefits, this is the only free and open-source option for those who want a high-quality encoder with support for 24p, scene changes, and advanced scene coding features. It also plays back on most media players out there, has a small resource footprint and can produce high-quality results.