Dubbed "DivX"--no relation to the defunct digital video disk (DVD) player--the technology allows video to be highly compressed while retaining a high-quality picture. Feature-length Hollywood movies could be downloaded in just a few hours and stored on a single CD.

That could be bad news for the film industry, which has so far avoided widespread Internet piracy primarily because movie files are too large to be traded conveniently online. Although DivX won't tear down those barriers completely, it shows that technology advances could bring Hollywood much sooner than it had hoped into the heated battles over digital distribution that are wracking the music industry.

Already, students armed with fast online connections and other Net-savvy consumers are beginning to use the new video format to trade high-quality film trailers and even full-length movies copied directly from DVDs. Fan sites that explain the technology and talk about new releases on the Net are springing up quickly--just as MP3 sites did in the early days of online digital music.

CNET News.com, for example, was able to download a full, VCR-quality version of the movie "Mars Attacks" in about four hours.

"DivX is what MP3 was to the music industry," said Wayne Chang, a Haverhill, Mass., student who manages the discussion boards for the Napster online music trading community, and who says he's begun to see the format catch on. "It's definitely going to stir up some trouble."

The prospect of easily downloadable music, video and software has already put an entertainment industry worried about digital piracy on the defensive.

MP3, an audio technology used by millions of Net surfers worldwide to download and listen to music, already has begun to undermine the record industry's traditional retail business model. The Recording Industry Association of America (RIAA) has sued both MP3.com and music-swapping community Napster, charging that the companies are facilitating widespread piracy of artists' copyrighted material.

DivX is a long way from reaching MP3's mainstream distribution, and as a hacker's creation, it might never break out of the underground communities. But it provides a preview of what may soon be a world where downloading full movies online is easy and relatively quick.

According to the DivX authors, who go by the names "MaxMorice" and "Gej" in the software's information file, their work is based on Microsoft's MPEG 4 video technology, with the addition of an MP3 audio stream. Although no DivX video players are known to exist, DivX files can be accessed through an add-on to Microsoft's Windows Media Player.

Microsoft could not be reached for comment.

The files found online are often copied from DVDs using another controversial technology, which allows DVDs to be played on computers using the open-source Linux operating system. The film industry has filed several suits seeking to block distribution of the program, known as DeCSS, alleging it illegally circumvents anti-copying features in DVDs aimed at preventing movie piracy.

MPEG 4 is a compression standard developed by the Moving Picture Experts Group, the latest in a series of formats developed for compressing audio and video. Its features go far beyond simply making video fast and easy to download--but its authors say that's certainly possible.

"It could be used for that in principle," said Eric Scheirer, an MIT Media Lab doctorate student who served as an editor for the MPEG 4 standard. Just recently completed, the standard has yet to find its way into wide commercial distribution, he said.

The pseudonymous DivX authors, who admit to hacking Microsoft's proprietary software to create their technology, aren't operating in the world of licenses and patent royalties.

But if their technology can find a way to break into the mainstream--or if the underlying Microsoft technology gets adopted to wide consumer use--the video world may well have its own MP3.

DivX in action
A side-by-side comparison of DivX with previous standards shows several clear advantages.

The trailer for the recent science fiction hit "The Matrix" distributed on the movie's official site provided a half-screen, mildly blurry film window. A DivX file, which was about 40 percent smaller, provided a full-screen shot with some pixelation, or a crystal-clear picture that sized to about three-quarters of the screen.

The technology is a long way from the point-and-click stage reached by MP3s, however. A full movie is broken into many pieces that have to be reassembled, and the download can often be interrupted by glitches in Net connections.

In addition, the quality is not always preserved from the original. In the "Mars Attacks" DivX download viewed by CNET News.com, for example, the film's soundtrack occasionally fell temporarily out of sync with the video--a problem attributable to inexpert encoding, according to people familiar with the format. Otherwise, however, the quality at full screen on a PC monitor was comparable to viewing a VCR recording on a television set.

The Motion Picture Association of America (MPAA), which already has launched lawsuits against individuals who provide technology for copying DVDs, says it's expecting a day when video technology reaches the easy-to-use level of MP3s. But that's a good thing for the studios, as long as they can protect their products, the organization says.

"We're not naïve. The technology will go there," said Rich Taylor, an MPAA spokesman. "But just because the technology is there doesn't give people the right to manipulate it in a way that is a violation of the laws."

Despite advances in compression technology, many analysts say that movies aren't likely to reach the status of music online anytime soon. The trouble it takes to spend hours downloading a film, for less than DVD quality, will persuade most people simply to rent a movie rather than pirating it, they say.

"It's never going to be as big as music," said Seamus McAteer, an analyst for Jupiter Communications. "It's a lot easier to (copy) music, to post it and to download it. It's not going to happen (with video) in the foreseeable future."