My strategy is to direct play or direct stream just about everything using low-cost single board computers like the Raspberry Pi.
Video transcoding is CPU intensive and sacrifices video quality from already-lossy sources. For low-power servers, video transcoding of HD content is more or less impossible.
In my experience, the biggest barrier to direct streaming/playing is subtitles. Clients that can’t render subtitles or can only render certain types of subtitles make certain content unwatchable.
This to me suggests that the biggest concern for a Plex server isn’t the server itself, but the clients. My smartphone with Kodi installed can direct play or stream anything on my Plex server, even though my Xbox One cannot. The truth is, it’s cheaper to obtain a client that can direct stream/play the most common types of content, than it is to invest in a powerful server that can transcode simultaneous 1080p streams.
Being able to disable video transcoding and hide unplayable content from clients would be very useful. Just an option to disable subtitle burning completely would go a long way.
On a related note, I don’t understand why Plex on the Xbox One or Playstation 4 cannot render subtitles client-side. These are two fairly beefy devices, why have the server do more work than it needs to? If the client can draw subtitles over the video, then no transcoding will be necessary, which saves
PGS subtitles (each subtitle is stored as an image)
Plex on Android TV can NOT “overlay” PGS subtitles thus PMS does have to transcode
Plex on PS4 can NOT “overlay” PGS subtitles thus PMS does have to transcode
Plex on Android can NOT “overlay” PGS subtitles thus PMS does have to transcode
Plex on Web (Chrome) can NOT “overlay” PGS subtitles thus PMS does have to transcode
Plex on FireTV 4K can NOT “overlay” PGS subtitles thus PMS does have to transcode
Plex Media Player can “overlay” PGS subtitles thus PMS does NOT have to transcode
SRT subtitles (each subtitle is stored as simple text)
Plex on Android TV can NOT “overlay” SRT subtitles thus PMS does have to transcode
Plex on PS4 can NOT “overlay” SRT subtitles thus PMS does have to transcode
Plex on Android can NOT “overlay” SRT subtitles thus PMS does have to transcode
Plex on Web (Chrome) can “overlay” SRT subtitles thus PMS does NOT have to transcode
Plex on FireTV 4K can NOT “overlay” SRT subtitles thus PMS does have to transcode
Plex Media Player can “overlay” SRT subtitles thus PMS does NOT have to transcode
Fun fact: Plex on FireTV 4K was able to Direct Play with PGS subtitles enabled in the past.
Given how much transcoding is intrinsic to the Plex “experience”, I wouldn’t hold your breath. While you might have an edge case for an nontraditional use of Plex… it is just that.
Plex is designed to be run on a device with sufficient horsepower to transcode.
While @sremick is right we all would have to transcode less if Plex Inc. would finally start to optimize their client apps. My Android smartphone supports AC3 as well as PGS and SRT subtitles but Plex thinks it doesn’t. Chrome also supports PGS but again Plex thinks it doesn’t. Same goes for Android TV and FireTV 4K. PS4 may be too restrictive what an App can do but it may be possible too.
The problem is that Plex Inc. prefers adding few but big features like DVR or Cloud for a minority instead of adding many but small features for the majority.
Sometimes Plex needs to transcode simply by virtue of the data link being less than the bitrate of the file. It has nothing to do with the filetypes or CODECs.
I definitely agree with the priority of features being added being horribly broken. Tons of people have been clamoring for trivial but extremely-useful features for years now but instead we get horrible, narrowly-targeted, poorly thought-out and rather broken things like “Plex Cloud”. The excuse we get is “we can work on more than one thing at once wink” but for some reason the little things take years? Right.
Well, if the available bandwidth is smaller than the bitrate of the video then transcoding is necessary, true but lets just assume it’s a 10 Gbps local network using fiber optics so we can stay focused on the subtitle issue