DVD has the capability to produce near-studio-quality video and better-than-CD-quality audio. DVD is vastly superior to videotape and generally better than laserdisc. However, quality depends on many production factors. Until compression experience and technology improves we will occasionally see DVDs that are inferior to laserdiscs. Also, since large amounts of video have already been encoded for Video CD using MPEG-1, a few low-budget DVDs will use that format (which is no better than VHS) instead of higher-quality MPEG-2 (See Chapters 6 and 7)
DVD video is compressed from digital studio master tapes to MPEG-2 format. This is a lossy compression (see Chapter 7) which removes redundant information (such as sections of the picture that don't change) and information that's not readily perceptible by the human eye. The resulting video, especially when it is complex or changing quickly, may sometimes contain artifacts such as blockiness, fuzziness, and video noise depending on the processing quality and amount of compression (Chapter 7). At average rates of 3.5 Mbps (million bits/second), artifacts may be occasionally noticeable. Higher data rates result in higher quality, with almost no perceptible difference from the original master at rates above 6 Mbps. As MPEG compression technology improves, better quality is being achieved at lower rates.
Some DVD demos have visible artifacts such as color banding, blurriness, shimmering, missing detail, and even effects such as a face which floats behind the rest of the moving picture. This is sometimes caused by poor MPEG encoding, but is just as often caused by a poorly adjusted TV or by sloppy digital noise reduction prior to encoding. The Free Willy and Twister excerpts on the Panasonic demo disc are good examples of this. In any case, bad demos are not an indication that DVD quality is bad, since other demos show no artifacts or other problems. Bad demos are simply an indication of how bad DVD can be if not properly processed and correctly reproduced. Early demos were shown on prototype players based on prerelease hardware and firmware. Many demo discs were rushed through the encoding process in order to be distributed as quickly as possible. Contrary to popular opinion, and as stupid as it may seem, these demos are not carefully tweaked to show DVD at its best. Also, most salespeople are incapable of properly adjusting a television set. Most TVs have the sharpness set too high for the clarity of DVD. This exaggerates high-frequency video and causes distortion, just as the treble control set too high for a CD causes it to sound harsh. DVD video has exceptional color fidelity, so muddy or washed-out colors are almost always a problem in the display, not in the DVD player or disc.
DVD audio quality is excellent. One of DVD's audio formats is LPCM (linear pulse code modulation) with sampling sizes and rates higher than audio CD. Alternately, audio for most movies is stored as discrete multi-channel surround sound using Dolby Digital or MPEG-2 audio compression similar to the surround sound formats used in theaters. As with video, audio quality depends on how well the encoding was done. Most audio on DVD will be in Dolby Digital format, which is close to CD quality.
The final assessment of DVD quality is in the hands of consumers. Most initial reports consistently rate it better than laserdisc. No one can guarantee the quality of DVD, just as no one should dismiss it based on demos or hearsay. In the end it's a matter of individual perception.