Abstract: An apparatus for generating a quantization parameter for use in controlling a quantizer quantization size for use in the quantization of a video frame signal, which comprises: a first calculation circuit for receiving the video frame signal and calculating the variance of the entire video frame signal; a video slice generator for receiving the video frame signal and dividing the video frame signal into a predetermined array of video slices; a second calculation circuit for receiving the predetermined array of video slices and sequentially calculating the variance of each of the video slices; a third calculation circuit for receiving the variance of the entire video frame signal and the variance of the each of the video slices and calculating the spatial activity of each of the video slices; and a quantization control circuit, in response to the spatial activity of each of the video slices, for generating an adjusted quantization parameter corresponding to each of the video slices in order to perform a fine qu