When you compress data for transmission over a wireless link, you’re typically trying to minimize two things: how many bits you send (rate) and how much the reconstructed signal differs from the original (distortion).
But there’s a third factor that matters, especially for images and video: does the output look realistic?
It turns out that minimizing pixel error may not be optimal from a perception perspective. You can do better with more pixel errors but no uncanny artifact that worsens the perception.
More at this link: Rethinking compression: why "good enough" quality might actually be better