Abstract: A method and apparatus for code communication is disclosed in order to achieve band-width compression. Successive portions of information are derived and the next portion of information is predicted from at least one preceding portion, an error signal is then generated corresponding to the difference between the predicted portion and the next actual portion of information, whereafter the error signal is coded for transmission to a receiving device. The system is particularly described for coding two level signals derived from a facsimile transmitter, e.g., by the scanning of text or pictures.