H,264/AVC and H,264/SVC currently represent the state-of-the-art in video coding technology. Recent research show that the compression efficiency of H.264/AVC for current sources (HD) is far from satisfactory. On top of this, many fundamental research directions in video coding have not been sufficiently explored in current standards. This project will therefore focus on novel techniques for spatial prediction, exploitation of spatial directionality, adaptive quantization stratigies, and novel methods to generate various spatial resolutions in scalable video streams.