A Brief Look at some competing media formats on the web.

Name Color Depth Transparency Stuff
GIF <256 colors or less single level transparency

built in animation

well established in browsers/editors

proprietary

limited to 256 colors

Ideal for icons, the gif is not area compressed so text still has crisp edges, the 256 color limit hinders photos, but is useful for limiting page bandwidth/download time.   Built in animation capabilities but is not any more useful than any other graphic for creating more advances user interfaces (say like changing graphic on mouse click)
JPG <24 million colors no transparency

well established in browsers/editors

no transparency

animation only by java or other code

Ideal for pictures, large scale image mapes. Area compressed meaning that flat areas of color may become blotched, and edges of text blurred. (meaning you will have to use larger fonts in order to be readable. Is a propritary format, although that doesn't seem to be stopping anybody from using it.

PNG <24 million colors multi-level transparency (alpha channel) not well established in browsers Potential to take the place of both jpg and gif for 2D graphics
VRML 24 million colors multi-level transparency (effectiveness depends on users hardware/software (since it's a rendered technology) requires a plugin for 3.0 browsers

A 3D format, capable of interactive animation, 3D sound placement, with extremely small structural file sizes (media like texture maps using jpeg, or audio/midi files still take up the same amount of space).