This seems like straining the definition of "compression". We have a delta-coding filter and then palettization? That's it?
Edit: I should say, I find it surprising (but cool) that it apparently works so well. I would have expected errors to accumulate since the decoder has to un-delta-code. I saw mention of Floyd-Steinberg dithering and presumably that's what it's for; seems hard to get it working across multiple colour axes simultaneously, but the complexity is all in the encoder, so.
Floyd-Steinberg dithering preserves 100% of the quantization error by shifting it onto neighboring pixels (unlike eg Atkinson dithering which only preserves 75%[0]), so the lack of drift I guess isn't too surprising really.
As for tracking error across multiple color axes, I would naively assume it's a 3-vector (maybe in a linearized perceptual color space, or maybe RGB) and the error term the encoder minimizes is just the vector magnitude?
Very cool. I think it's best understood as a coding exercise for the embedded CPU vs a 'real' video format, but no less impressive IMO
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