Forward error correction (FEC) coding has been shown to offer a feasible solution to fulfill the need for Quality of Service for multimedia streaming over the fluctuant channels, especially in terms of the reduction of end-to-end delay. In this paper, we propose the Dynamic FEC-Distortion Optimization Algorithm to efficiently utilize the network bandwidth for better visual quality by means of hierarchical coding structure with the cascading error protection scheme. The optimization criteria are based on the unequal error protection by taking account of the error drifting problems from both temporal motion compensation and inter-layer prediction of the H.264/MPEG-4 AVC scalable video coding so that the priorities of each video components can be differentiated for the calculation of the distribution of parity packets. It is shown that the cascading error protection scheme makes the hierarchical structure of error erasure code more efficient. Also, the proposed algorithm works particularly well for fast motion videos and the performance does not depend on accurate estimation of packet loss rate.