So the new service allows Your Zencoder to create HTTP Live Streaming video (HLS) with MPEG-TS format and because their equipment segmenting them can offer you a much better streaming and lower file size for storage.
Zencoder offers the only optimized implementations of HTTP Live Streaming is available in the cloud. In my tests that are run by third parties, Zencoder grouping produced files with 70% less overhead from Sorenson Media, up to 84% less from Encoding.com, and up to 50% less overhead of harmonic's ProMedia carbon.
MPEG-TS (Transport Stream MEPG) format using the h.264 video and AAC audio (HE-AAC, or AAC-LC), and according to Apple in the specification of the Protocol: HLS
To play the stream, the client first obtains a Playlist file, and then obtain and play any media files in the playlist. It's the Playlist file as described in this document to find additional segments.
Shorter segments resulted in more frequent refresh the index file, which might create unnecessary overhead for network clients. Another segment will extend the inherent latency broadcasting and initial startup time. Duration of 10 seconds per media files seem to strike a reasonable balance to most content broadcast.