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Encode Video for Wi-Fi and EDGE

You can use the QuickTime Pro v7.2 Export command and the following exporters to prepare video content for iPhone:
"Movie to iPhone" prepares movies for Wi-Fi.
"Movie to iPhone (Cellular)" prepares movies for EDGE.

For QuickTime Pro v7.1.6 and earlier, use these exporters and settings:
The Movie to MPEG-4 exporter with the following settings prepares movies for Wi-Fi.
In the H.264 video options, make sure you restrict the encoder to use the Baseline profile, and select "Faster encode (Single-pass)" encoding in the Video Options dialog.
Video settings: 900 kbit/sec, H.264, 480 x 360; frame rate: current; preserve aspect ratio using: Fit within size
Audio settings: 128 kbit, AAC-LC
.mp4 file
The Movie to 3G exporter with the following settings prepares movies for EDGE.
Video settings: 64 kbit, H.264, 176 x 144; frame rate: 10 or 15; preserve aspect ratio using: Letterbox or Crop
Audio settings: 16 kbit, AAC-LC
.3gp file

In each of the QuickTime Pro v7.1.6 and earlier exporters, turn off streaming; iPhone does not stream media using RTP/RTSP.

Size Movies Appropriately

In landscape orientation, the iPhone screen is 480 x 320 pixels. Users can easily switch the view mode between scaled-to-fit (letterboxed) and full-screen (centered and cropped). You should use a size that preserves the aspect ratio of your content and fits within a 480 x 360 rectangle. 480 x 360 is a good choice for 4:3 aspect ratio content as it will keep the video sharp in full-screen view mode.

Don’t Let Bit Rate Stall Your Movie

When viewing media over the network, bit rate makes a crucial difference to the playback experience. If the network cannot keep up with the media bit rate, playback stalls.

Use Supported Movie Formats

The following movie formats are supported:
H.264 Baseline Profile Level 3.0 video, up to 640 x 480 at 30 fps. Note that B frames are not supported in the Baseline profile.
MPEG-4 Part 2 video (Simple Profile)
AAC-LC audio, up to 48 kHz
.mov, .mp4, .m4v, .3gp file formats
Any movies or audio files that can play on an iPod.