Wikipedia
H.263 is a video compression standard originally designed as a low-bit-rate compressed format for videoconferencing. It was developed by the ITU-T Video Coding Experts Group (VCEG) in a project ending in 1995/1996 as one member of the H.26x family of video coding standards in the domain of the ITU-T, and it was later extended to add various additional enhanced features in 1998 and 2000. Smaller additions were also made in 1997 and 2001, and a unified edition was produced in 2005.
The H.263 standard was first designed to be utilized in H.324 based systems ( PSTN and other circuit-switched network videoconferencing and videotelephony), but it also found use in H.323 ( RTP/IP-based videoconferencing), H.320 ( ISDN-based videoconferencing), RTSP ( streaming media) and SIP (IP-based videoconferencing) solutions.
H.263 is a required video coding format in ETSI 3GPP technical specifications for IP Multimedia Subsystem (IMS), Multimedia Messaging Service (MMS) and Transparent end-to-end Packet-switched Streaming Service (PSS). In 3GPP specifications, H.263 video is usually used in 3GP container format.
H.263 also found many applications on the internet: much Flash Video content (as used on sites such as YouTube, Google Video, MySpace, etc.) used to be encoded in Sorenson Spark format (an incomplete implementation of H.263). The original version of the RealVideo codec was based on H.263 until the release of RealVideo 8.
H.263 was developed as an evolutionary improvement based on experience from H.261, the previous ITU-T standard for video compression, and the MPEG-1 and MPEG-2 standards. Its first version was completed in 1995 and provided a suitable replacement for H.261 at all bit rates. It was further enhanced in projects known as H.263v2 (also known as H.263+ or H.263 1998), MPEG-4 Part 2 and H.263v3 (also known as H.263++ or H.263 2000). MPEG-4 Part 2 is H.263 compatible in the sense that basic "baseline" H.263 bitstreams are correctly decoded by an MPEG-4 Video decoder.
The next enhanced format developed by ITU-T VCEG (in partnership with MPEG) after H.263 was the H.264 standard, also known as AVC and MPEG-4 part 10. As H.264 provides a significant improvement in capability beyond H.263, the H.263 standard is now considered a legacy design. Most new videoconferencing products now include H.264 as well as H.263 and H.261 capabilities. An even-newer standard format, HEVC, has also been developed by VCEG and MPEG, and has begun to emerge in some applications.