Allow me to elaborate more.

On the server, we will have a program that will take data from iPhone and process that data and produce series of images. Each time an image is generated, it will be send back to display on iPhone.

I have done all of the things above using UDP, OpenGL, and such. It works. The images are transferred to iPhone and can be displayed, but it is slow. The image's resolution is around 320 x 420 and we send the image pixels by pixels. This naive implementation leads to a slow framerate. I can see around 2-3 frames per second. There are also some UDP packets dropped, and this is expected.

Are there any sort of compression method available for something like this? Are there any other method that can make this better?

NOTE: please don't just write "compression" as an answer, because we are aware that we will need to do it in some ways.