When Serviio installs FFMPEG, it is not added to the PATH statement, so Windows doesn't know where it is. That is why you get the error. In a standard Serviio Windows install, the install path is C:\Program Files\Serviio\lib. Since it's not stored in the Windows PATH statement, you have to type the complete path to the exe file.
If that log you attached is accurate, for some reason FFMPEG is missing from the lib folder. You can download the latest version (
https://ffmpeg.zeranoe.com/builds/) and install it yourself. Just copy the ffmpeg.exe file into the Serviio/Lib folder. That should resolve your error. You can install either the 32 or 64 bit version. I personally always use the 64 bit.
EDIT: Maybe I misunderstood, and you aren't using Windows. I believe for Linux you have to install Java manually, but I don't know if it has to be in the Serviio Lib folder of if just installing an SDK is sufficient. I'd have to research some more to know more. And that download link above is only for the Windows version of FFMPEG.
If you are running Linux, yes you must install Java separately:
Linux users must install FFmpeg via their OS distribution package manager or build it from the sources on the Download page. The
Wiki has some useful guides.
Dan
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HOWTO: Enable debug logging HOWTO: Identify media file contents