Textures are images that are displayed on a 3D geometry. Most textures are two-dimensional, static images, such as JPEG and PNG files. However, Unity also supports animated textures in the form of video or movie textures. These allow you to import movie files into your project and use them as textures. The movies can play with sound and be presented in-game. Therefore, they are especially useful for creating cut-scenes, credit sequences, flashbacks, advertisements, and other special effects. They are, however, resource heavy, making them a big hitter on performance. For this reason, you should use them sparingly. Unity supports different movie formats, but the recommended format is OGV (the Ogg Theora video). More information on this format can be found online at http://www.theora.org/.
Note
Even if your movies are not in OGV format, you can easily convert them using the VLC media player software, which is available for free at http://www.videolan.org/vlc/index.en_GB.html.
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