Do not use PNG8 as the tile format if you are caching a multiband image service. It is recommended to use other tile formats such as PNG24/ PNG32 /JPEG/Mixed.
Solution
Redefine the tile format that can support caching a multiband image service.
- Right-click the message and click Show Advanced Cache Settings page.
- Change the tile format from PNG8 to any of the other tile formats listed.
More Information
When publishing a mosaic dataset as an image service, the mosaic dataset will be analyzed. This analysis is performed at a higher level and will compare the resolution corresponding to minimum and maximum cache scales to the maximum visible cell size of the mosaic dataset.