TL;DR: if Video Acceleration is "On"
A video can take up to 30 minutes to convert to SmartVideo depending on the length and resolution of the video file (it usually takes way less time than that). You will know that a video has been fully converted by SmartVideo when, while hovering over the Video Acceleration icon on the player, the popup box says Video Acceleration: On
P.S. If you are using the SmartVideo plugin for WordPress, check to make sure that SmartVideo is enabled in the plugin. When enabled, it will look like this: