How to convert video recorded with a Panasonic Lumix FZ35 (AVCHD, 720p) for playback in Linux

You will need:
– Recent ffmpeg
– Panasonic Lumix FZ35 (duh)

ffmpeg -i INPUT-FILE-FROM-CAMERA.MTS -vcodec libxvid -b 7000k -acodec libmp3lame -ac 2 -ab 192k -deinterlace -s 1280x720 output-file.avi