What is the most bandwidth efficient video codec?

Say I want to let my users upload videos to my website(using PHP) and also let them watch other videos. But I want it to work really bandwidth efficient and I want to somehow compress/convert the videos and make them smaller in size, with minimal loss of quality. Is there any particular extension which is pretty much what I want? Any additional information about conversion/extensions/file size/ bandwidth is al开发者_JAVA技巧so appreciated.

Thanks.