HEVC (H265) is a standard which lowering video bitrate by around 50% when comparing to H264 (one of the best standard) which means significant decrease of the resulting video file size. The raw .avi of mine had 465MB and after conversion to an mp4 H265 it had 10MB while i was unable to say difference in quality.

NOTE: H265/x265 is old, new widely supported codec will be AV1 !!!

VLC player should support playback of H265, but in my case conversion/encoding failed, only playback worked.

What worked to convert/encode classic video using HEVC (H265) was SW called Internet Friendly Media Encoder/x265GUI


(i also read that K-Lite Codec Pack can be used to enable HEVC playback, but im unsure if VLC would use it for conversion/encoding)

Resulting .mp4 video has similar quality like original, but file size was lower than .flv original.
When converted x264 mp4 543MB movie, resulting size was 235MB and quality very similar, i only thought converted video had less red color.

Format : HEVC
Format/Info : High Efficiency Video Coding
Format profile : [email protected]@Main
Codec ID : hvc1
Writing library : x265 1.9+3-548a45bbf223:[Windows][GCC 5.2.0][64 bit] 8bit

Encoder can also create .mkv file but i had an impression mp4 video quality was better when used same setting.