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The Portable Network Graphics format is a common and free Image format used to store and exchange digital bitmapped images of all kinds. For general information see the PNG Wikipedia page

PNG was originally created because of shortcomings and patent issues with widely used GIF format. It uses lossless compression and supports different bit depth and alpha channel transparency. It often compresses better than the different TIFF compressions. However, it is not very well supported by Photoshop (you need a format plugin to support all flavors: [1])

Only recently PNG support of the Panorama tools core library pano12 was fixed.