With WebCenter Content 11g, the Inbound Refinery handles image conversions with a built-in copy of the Oracle Outside In technology. This provides a nice basic way of doing image conversions without any extra installation or configuration steps. But in UCM 10g, there was no built-in conversion offered, so image converters (such as Image Alchemy or ImageMagick) were always necessary.
While the built-in converter can do some basic conversion functions such as manipulating sizes and formats, to do more advanced changes you still might need a 3rd party product such as Adobe Photoshop, Helios Image Server, or NConvert. And to integrate to those 3rd party converters, you need extra components that is not installed directly with WebCenter Content. These component are available on our WebCenter Content Tutorials page as Digital Asset Management - Samples.
The bundle comes with 2 separate components. One is for using Photoshop automation specifically and the other is for using any other command-line based conversion tool (there are example rendition sets for NConvert, Image Alchemy, Helios Image Server, and Image Magick). Each component comes with a readme.txt with detailed instructions on how to configure the rendition sets and such, so I won't cover that here.
Another nice feature that was introduced in 11g was the ability to pass in metadata values to the rendition sets to control the conversion. One good use-case for that is to have a rendition set in which you can specify the exact resolution that you need on the check-in page for the web rendition.
And this is what the extParameters might look like for that rendition set (this is for NConvert):
-out jpeg -o <$outFile$>.jpg -resize <$if xDAM_Width$><$xDAM_Width$><$else$>800<$endif$> <$if xDAM_Height$><$xDAM_Height$><$else$>600<$endif$>