These are some simple scripts for windows users that let you convert animation image sequences or video files into some properly compressed MP4 or WEBM files and have some thumbnails made as well.
Also comes with a batch convert feature if you need to convert lots of legacy stuff.
For advanced users I suggest using AviDemux or MeGui to make individually fine-tuned MP4 files.
Instructions on how to use:
http://aregeecs.tumblr.com/tutorial-sfm-video-files (this should be most up to date version of the manual)
also mirror here on sfmlab:
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