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Recent technology advances in mobile networking have ushered in a new era of personal communication. Users can ubiquitously access the Internet via many emerging mobile appliances, such as portable notebooks, personal digital assistants (PDAs), and WAP-enabled cellular phones. While the transcoding proxy is attracting an increasing amount of attention in this environment, it is noted that new caching strategies are required for these transcoding proxies. We propose an efficient cache replacement algorithm for transcoding proxies. Specifically, we formulate a generalized profit function to evaluate the profit from caching each version of an object. This generalized profit function explicitly considers several new emerging factors in the transcoding proxy and the aggregate effect of caching multiple versions of the same object. It is noted that the aggregate effect is not simply the sum of the costs of caching individual versions of an object, but rather, depends on the transcoding relationship among these versions. The notion of a weighted transcoding graph is devised to evaluate the corresponding aggregate effect efficiently. Utilizing the generalized profit function and the weighted transcoding graph, we propose, in this paper, an innovative cache replacement algorithm for transcoding proxies. In addition, an effective data structure is designed to facilitate the management of the multiple versions of different objects cached in the transcoding proxy. Using an event-driven simulation, it is shown that the algorithm proposed consistently outperforms companion schemes in terms of the delay saving ratios and cache hit ratios.