Transcoding = Bad?

I know if I transcode an audio file, I lose quality. Such as converting an MP3 to an OGG.

Yet, with Plex transcoding on the fly with codecs such as x265. Is the above still true?

Do I lose the benefits of using x265 if it is going to just transcode it?

Should I just stick to files that Plex isn’t going to trancode such as x264.

Transcoding = requires powerful cpu. particularly when transcoding video

Transcoding from one lossy format to another lossy format is always “lossy” when it comes to fidelity/quality.
However how big the perceived loss is, is very subjective and depends on a whole load of variables.
(Practically every video codec is lossy [please don’t chime in and quote some professional-grade intermediate storage format which is not - this is not the topic here])
(Audio the same with exception of Flac, Wav, Alac and Ape)

So, if you have a lot of clients which don’t support H.265 directly, I’d refrain from using H.265 for now.

I use transcoding sometimes because my smart TV doesn’t direct play with subtitles and I have some movies where subtitles are needed, and most of the time it’s h264 to h264 transcoding. I noticed that with the "Prefer higher speed encoding " settings there was a visible degradation in highly detailed scenes, for example the classic newspaper front page where the headline is in a foreign language and is translated on subtitles, with this scene the loss in quality was visible. I changed the transcoding settings to “Prefer higher quality encoding” and I did not notice the quality loss anymore.

I have few h265 files because my server has a low power CPU, but I think the result will be similar: prefer speed and you’ll loose some quality, make your cpu burn and you should be able to preserve most of the original quality at the expense of computation time. Right now when I use h265 I use a player that can direct play. On smaller screen though (like an iPad) the loss in quality is almost negligible because of the small screen.

If you have strong material - say a magnum BluRay ‘copy’ via MakeMKV a strong setting for the transcoder will likely produce a version that looks pretty good.

If you’re using DVD source material and expect Plex to transcode it and not have it look like it was put through a Bass-0-Matic out the other end - better re-think that plan. Transcoding will deeee-stroy it. Better create Direct Play material in this case - or suffer the consequences.

Note: I’m pretty sure Plex’s Transcoder played a large part in creating this video.
It sucks really badly, but is a good illustration of what to expect.

[Mod edit - Please don’t use YouTube videos if they don’t directly relate to the question]

I actually do not worry about what format my media is in as I have a very powerful server and it is tasked with nothing else and I am the only user. I have the transcoder set at whatever the setting is right below “Make my CPU hurt.”

I have compared the visual quality of transcoded video on my Roku with direct played on my Shield TV and I see almost no difference and defiantly no difference that adversely impacts my viewing or would make it worthwhile for me to re-encode all the affected videos.

Of course my eyes are old, as is the rest of me, so others might see problems that I do not but I do not maintain my library to please others.

So, for me, all new encodes are done to a file format that direct plays on all my devices but I allow Plex to transcode any of the older files that were created before Plex with many created before there were playback devices widely available that were not regular PCs, I just let Plex do its thing and then enjoy watching what it spews out.

For me media should be enjoyed not obsessed over. There are many other uses for which I can put my OCD to work so it is possible for me just to enjoy my content.