How to loop video on Raspberry Pi?

Question

Raspberry Pi

It is necessary to make a monitor + video player based on "raspberries".
Actually the video is normally played through omxplayer. For looping, a script taken from an Internet is used

#!/bin/sh

# get rid of the cursor so we don't see it when videos are running
setterm -cursor off

# set here the path to the directory containing your videos
VIDEOPATH="/mnt/storage/videos" 

# you can normally leave this alone
SERVICE="omxplayer"

# now for our infinite loop!
while true; do
        if ps ax | grep -v grep | grep $SERVICE > /dev/null
        then
        sleep 1;
else
        for entry in $VIDEOPATH/*
        do
                clear
                omxplayer $entry > /dev/null
        done
fi
done

The problem is that the transition between videos is about 1-3 seconds. How can this be dealt with? Is it possible to buy a license for MPEG2 and use another player (eg mplayer)?