Abstract: A method and system for encoding a video signal provides an encoded signal that is compressed in order that it may be efficiently transmitted over the link whilst also meeting a predetermined standard in terms of its estimated perceptual quality when the signal is decoded and displayed. This is achieved by providing, at the encoding end, a control unit (24) which utilises a perceptual quality metric (PQM) system (32) to quantify the estimated perceptual quality, and control logic (34) that compares said quantified PQM with a user-defined criterion that the signal must meet prior to transmission. The signal is preferably only transmitted onwards over the communications link if the criterion is met. Otherwise, the control unit (24) is operable either to modify the signal, e.g. using pre-filtering, or use modified encoding parameters to re-encode the signal in such a way as to improve its quality, that is to make the quantified PQM converge towards the criterion.