A system comprising: a graphical processing unit, GPU; an image format transcoder to convert an image stored in an image compression format into a plurality of blocks represented in a texture compression format, the image format transcoder comprising: a decoder to decode the image into one or more decoded blocks; a splitter to split each decoded block into multiple decoded subblocks (504A, 504B, 504C, 504D); and a texture compression format encoder configured to encode a particular one of the multiple decoded subblocks (504A, 504B, 504C, 504D) into a particular one of the blocks in the texture compression format, wherein the particular one decoded subblock includes a plurality of colors, wherein the particular one block in the texture compression format is encoded using a limited set of colors and wherein the limited set of colors have smaller number of colors than the plurality of colors, wherein the texture compression format encoder is characterized in that it is further configured to: determine the size of the limited set of colors to encode the decoded subblock, the determining including: computing average color in the subblock and standard deviation among the colors in the subblock; and comparing the standard deviation to a set threshold, wherein the decoded subblock is to be encoded using two colors if the standard deviation transgresses the set threshold, otherwise the decoded subblock is to be encoded using one color; the system further comprising a bus to transfer the particular one block of the texture compression format to the GPU for processing. a graphical processing unit, GPU; an image format transcoder to convert an image stored in an image compression format into a plurality of blocks represented in a texture compression format, the image format transcoder comprising: a decoder to decode the image into one or more decoded blocks; a splitter to split each decoded block into multiple decoded subblocks (504A, 504B, 504C, 504D); and a texture compression format encoder configured to encode a particular one of the multiple decoded subblocks (504A, 504B, 504C, 504D) into a particular one of the blocks in the texture compression format, wherein the particular one decoded subblock includes a plurality of colors, wherein the particular one block in the texture compression format is encoded using a limited set of colors and wherein the limited set of colors have smaller number of colors than the plurality of colors, wherein the texture compression format encoder is characterized in that it is further configured to: determine the size of the limited set of colors to encode the decoded subblock, the determining including: computing average color in the subblock and standard deviation among the colors in the subblock; and comparing the standard deviation to a set threshold, wherein the decoded subblock is to be encoded using two colors if the standard deviation transgresses the set threshold, otherwise the decoded subblock is to be encoded using one color; the system further comprising a bus to transfer the particular one block of the texture compression format to the GPU for processing. a decoder to decode the image into one or more decoded blocks; a splitter to split each decoded block into multiple decoded subblocks (504A, 504B, 504C, 504D); and a texture compression format encoder configured to encode a particular one of the multiple decoded subblocks (504A, 504B, 504C, 504D) into a particular one of the blocks in the texture compression format, wherein the particular one decoded subblock includes a plurality of colors, wherein the particular one block in the texture compression format is encoded using a limited set of colors and wherein the limited set of colors have smaller number of colors than the plurality of colors, wherein the texture compression format encoder is characterized in that it is further configured to: determine the size of the limited set of colors to encode the decoded subblock, the determining including: computing average color in the subblock and standard deviation among the colors in the subblock; and comparing the standard deviation to a set threshold, computing average color in the subblock and standard deviation among the colors in the subblock; and comparing the standard deviation to a set threshold, wherein the decoded subblock is to be encoded using two colors if the standard deviation transgresses the set threshold, otherwise the decoded subblock is to be encoded using one color; the system further comprising a bus to transfer the particular one block of the texture compression format to the GPU for processing.