In distributed systems, transcoding techniques have been used to customize multimedia objects, utilizing trade-offs between the quality and sizes of these objects to provide differentiated services to clients. Our research uses transcoding techniques in wireless systems to customize video streams to the requirements of users, while minimizing the energy costs. We introduce an approach to dynamically determine which transcoders to execute and where to execute them (e.g., client or server). The goal is to select appropriate transcoders (a) to provide clients with the quality of service they desire while (b) minimizing the energy consumption of the end-hosts in accordance with application-specific global energy management directives. This paper investigates sample transcoder functions for video streaming on handheld devices and introduces a mechanism for selecting the most appropriate transcoders and transcoder parameters.