HOW CAN I CONVERT MOVIE TO IPHONE SUPPORTED VIDEO FORMAT?

Hello..I have a little troubles with the acclimatisation of movie to iPhone. I paid for an iPhone final week and yesterday when I put a movie onto iPhone and click play, the phone give me a notice which he cannot fool around video in which format. I think I need to modify the movies to iPhone upheld format first. So how can I understanding with the conversion? Can any one suggest a absolute and free converter for me ?