Current networks show increasing heterogeneity both in terms of their bandwidths/delays and the applications they are required to support. This is a trend that is likely to intensify in the future, as real-time services, such as video, become more widely available and networking access over wireless links becomes more widespread. For this reason they propose that application-specific proxies, intermediate network nodes that broker the interactions between server and client, will become an increasingly important network element. These proxies will allow adaptation to changes in network characteristics without requiring a direct intervention of either server or client. In the report, particular effort was spent in studying caching techniques and on video classification to enable DiffServ delivery. Other work included analysis of traffic characteristics, optimized media scheduling, coding techniques based on multiple description coding, and use of proxies to reduce computation costs.