Wavelet-transform lossy coding achieves state-of-the-art performance for still images. For motion-compensated interframes, however, block-transform coding is preferred due to its ability to intracode poorly predicted blocks. Space-frequency half-pixel block matching is a new approach that enables hybrid block-motion-compensated wavelet-coded interframes to efficiently code blocks with low temporal correlation of high-frequency details. Architectural compatibility is maintained and little additional complexity is required to achieve superior performance. Simulation results with both fixed-size block matching and hierarchical-variable-sized block matching indicate that a block size-constrained adaptive choice of interpolation filter improves the PSNR by 0.75 dB for hybrid wavelet interframe coding (versus +0.25 dB for H.263) at multimedia quality bit rates. For H.263, bit rate reduction can approach 30% at higher rates. The method is perceptually successful where a block-translational motion model fails, efficiently reducing falsely introduced detail.
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