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Mpeg1 is surly the way to go for compatibilty, with a small video like that, most can double size it ok with some loss to the quality, But with video that small you might even be able to squeze a little less on the bit rat if you are concerned about BW. I would not go lower then 350 to 400. But still should come down really nicly. I have seen camshows stream at 200 on WM9 and look like tv quality but thats a whole other animal.
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