There are several ways, including using a hardware encoder such as a wired mediapress board, or a sonic SD1000... or use a PC running Procoder or Cinemacraft... there are almost endless possibilities. Look for real time MPEG compression in google to see what I mean.
Alternative software encoders for the mac include Bitvice and MegaPEG X. The speed of these will depend on your machine specs, but I would still say the best encoding is on a PC (for best, read fast and high quality), but there are smaller differences than there used to be only a couple of years ago.