The audio and video streams that are contained within the file are generally, though not always, compressed. The container will identify the compressor/decompressors (codecs) used to compress the audio and video. You must have the appropriate audio and video codecs installed on your computer to play or create a video.
Common container formats like MOV, AVI and Flash are proprietary -- they are developed and controlled by a private company. Ogg (OGM) is an open source container format. Ogg development is coordinated by the non-profit Xiph foundation, which has several related programs including vorbis, an audio codec, and Theora, a video codec.
Converting a media file from one format to another format or bit rate is called transcoding.