Technical Merits To Reduced Resolution
In 1998 ABC Television made available the "Frequently Asked Questions" document in regards to HDTV standard, chosen by the company, which was 720p. One of the questions, titled "Which scanning standard is best suited for future?" contained the following information:
The 1080 x 1920 (1080I) interlace format specified in the ATSC standard CANNOT be compressed to fit in a 6MHz channel without creating objectionable artifacts and it has been recommended that the 1920 pixels be sub-sampled to 1440 to reduce compression artifacts. Therefore, encoder manufacturers have elected to discard approximately 25% of the picture for over-the-air transmission.
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Besides subsampling that occurs during broadcast, many professional video recording formats do not deliver full horizontal resolution as well. For example, frame size of 1080-line HDCAM format is 1440x1080, frame size of 1080-line DVCPRO HD format is either 1440x1080 or 1280x1080 depending on scanning rate, frame size of 720-line DVCPRO HD format is 960x720. Horizontal downsampling is used in preference to vertical downsampling because vertical downsampling would break any interlacing, and also because Cathode Ray Tube (CRT) displays (which were still common when the HD formats were standardised) scan horizontal rows continuously, but vertical lines discretely, making changes to vertical resolution more visible on such displays. The situation has begun to change with launch of newer video recording formats that use full 1920x1080 raster, like XDCAM HD422 or AVC-Intra.
New encoding schemes allow reducing data rate even further. For example, MPEG-4/AVC is considered to be twice as efficient as MPEG-2, originally used for HD broadcast.
Read more about this topic: HD Lite
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