A novel video compression scheme that exploits the idea of second-order-residual (SOR) coding is proposed for
high-bit-rate video applications in this work. We first study the limitation of today's high performance video
coding standard, H.264/AVC, and show that it is not effective in the coding of small image features and variations
for high-bit-rate video contents. For low to medium quality video streams, these small image features can be
removed by the quantization process. However, when the quantization stepsize becomes small in high-bit-rate
video, their existence degrades the rate-distortion coding performance significantly. To address this problem, we
propose a coding scheme that decomposes the residual signals into two layers: the first-order-residual (FOR) and
the second-order-residual (SOR). The FOR contains low frequency residuals while the SOR contains the high
frequency residuals. We adopt the H.264/AVC for the FOR coding and propose two schemes, called SOR-freq
and SOR-bp, for the SOR coding. It is shown by experimental results that the proposed FOR/SOR scheme
outperforms H.264/AVC by a significant margin (with about 20% bit rate saving) in high-bit-rate video.
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