A compression scheme that results in no loss of data from the file when it is decompressed.

Lossless compression is a class of data compression algorithms that allows the original data to be perfectly reconstructed from the compressed data. By contrast, lossy compression permits reconstruction only of an approximation of the original data, though usually with greatly improved compression rates (and therefore reduced media sizes).

Lossless data compression is used in many applications. For example, it is used in the ZIP file format and in the GNU tool gzip. It is also often used as a component within lossy data compression technologies (e.g. lossless mid/side joint stereo preprocessing by MP3 encoders and other lossy audio encoders).

Lossless compression is used in cases where it is important that the original and the decompressed data be identical, or where deviations from the original data would be unfavorable. Typical examples are executable programs, text documents, and source code. Some image file formats, like PNG or GIF, use only lossless compression, while others like TIFF and MNG may use either lossless or lossy methods. Lossless audio formats are most often used for archiving or production purposes, while smaller lossy audio files are typically used on portable players and in other cases where storage space is a limited or exact replication of the audio is unnecessary.

Most lossless compression programs do two things in sequence: the first step generates a statistical model for the input data, and the second step uses this model to map input data to bit sequences in such a way that "probable" (e.g. frequently encountered) data will produce shorter output than "improbable" data.

The primary encoding algorithms used to produce bit sequences are Huffman coding (also used by DEFLATE) and arithmetic coding. Arithmetic coding achieves compression rates close to the best possible for a particular statistical model, which is given by the information entropy, whereas Huffman compression is simpler and faster but produces poor results for models that deal with symbol probabilities close to 1.

There are two primary ways of constructing statistical models: in a static model, the data is analyzed and a model is constructed, then this model is stored with the compressed data. This approach is simple and modular, but has the disadvantage that the model itself can be expensive to store, and also that it forces using a single model for all data being compressed, and so performs poorly on files that contain heterogeneous data. Adaptive models dynamically update the model as the data is compressed. Both the encoder and decoder begin with a trivial model, yielding poor compression of initial data, but as they learn more about the data, performance improves. The most popular types of compression used in practice now use adaptive coders.

Lossless compression methods may be categorized according to the type of data they are designed to compress. While, in principle, any general-purpose lossless compression algorithm (general-purpose meaning that they can accept any bitstring) can be used on any type of data, many are unable to achieve significant compression on data that are not of the form for which they were designed to compress. Many of the lossless compression techniques used for text also work reasonably well for indexed images.

These techniques take advantage of the specific characteristics of images such as the common phenomenon of contiguous 2-D areas of similar tones. Every pixel but the first is replaced by the difference to its left neighbor. This leads to small values having a much higher probability than large values. This is often also applied to sound files and can compress files that contain mostly low frequencies and low volumes. For images, this step can be repeated by taking the difference to the top pixel, and then in videos, the difference to the pixel in the next frame can be taken.

A hierarchical version of this technique takes neighboring pairs of data points, stores their difference and sum, and on a higher level with lower resolution continues with the sums. This is called a discrete wavelet transform. JPEG2000 additionally uses data points from other pairs and multiplication factors to mix them into the difference. These factors must be integers so that the result is an integer under all circumstances. So the values are increased, increasing file size, but hopefully, the distribution of values is more peaked.

The adaptive encoding uses the probabilities from the previous sample in sound encoding, from the left and upper pixel in image encoding, and additionally from the previous frame in video encoding. In the wavelet transformation, the probabilities are also passed through the hierarchy.

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