1. A device or software application that converts the digital format of a file or stream of data to another format. This may be to reduce the size of a file for storage or archiving, or to thin the density of a data stream for transmission, to increase the security of a file, or for other reasons.
2. A “soft knob” on a hardware device — meaning a physical knob that sends out digital control signals as assigned by OS/software of the device. In a control surface, an encoder might be assigned to control pan. In a hardware synthesizer, an encoder might be assigned to control filter cutoff.