This excerpt was provided by Home Theater Hi Fi. www.hometheaterhifi.com
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DCDi
DCDi is a video mode algorithm that stands for Directional Correlation Deinterlacing. It was designed for video based material like fast-paced sporting events. Its purpose is to eliminate jagged edges (jaggies) along diagonal lines caused by interpolation. If you remember, you are not simply weaving together two fields of video that match, you have to create new information through the art of interpolation which is really a fancy way to say you are guessing. DCDi monitors edge transitions and fills in the gaps. The technology was introduced a few years back in the digital format translator, a $50,000 system that broadcasters like CBS use to upconvert NTSC to HD. It was/is used to upconvert standard definition material (480i, what we have on conventional TV) to enhanced definition quality (480p). You may already being enjoying DCDi today on your digital TV.
In Figure 2 above, you will see how DCDi makes the Stars and Stripes much more dramatic, and it is really a terrific illustration of how powerful DCDi is. On the left is the original image on a TV. The flag is blowing in the wind, and this is a very tough image for a TV to show. On the right are enlargements of an area in the middle of the picture. At the top, right, is that enlarged area of the flag, with DCDi turned off. Notice the junctions of the red and white stripes. You can see jagged lines. With DCDi turned on (bottom, right), the jagged lines are gone, and the junctions between the red and white stripes are smooth. This is a huge technical accomplishment by Faroudja engineers.
Because DCDi is a video algorithm (an algorithm is a series of mathematical formulas), you might wonder how it affects viewing a film on TV. Remember, in order to avoid artifacts, a video processor will switch modes (film vs. video - video vs. film). If the transition between video and film is not done properly by the studio, it is called a Bad Edit. The video processor will then treat the film material as video during those sections of bad edits. There are a couple of giveaways when the processor has switched from film mode to video mode. First is the loss of resolution. This is minimized because the Faroudja algorithm is motion adaptive. The second is the appearance of jaggies along diagonal edges. DCDi hides a good portion of the jaggies, so you never realize when it changes from and to film mode, which is the whole point! DCDi makes the movie watching experience more enjoyable because the annoying artifacts are all gone, so all you have to worry about is whether there is any more microwave popcorn in the kitchen cabinet.

Implementing the Technology
The FLI2200 chip can be customized by the engineers who are building the products, such as DVD players. By default, the chip has preset values and as time passes, Sage will be adding features to the set of default values to increase its flexibility.
The clear advantage of having the FLI2200 bolted to a DVD player is that the signal stays digital during video processing, rather than processing it in the analog domain. It is much easier to find matched fields when they are 100% bit-for-bit identical. If you convert to analog and then back to digital, noise will be introduced. Since noise is random, two matched fields may contain enough noise to make them look slightly different. This makes the work of the deinterlacer harder and not as reliable, but not impossible. In fact they have had to do it this way for many years, so they know how to deal with noisy material.
The FLI2200 has a couple of implementation choices. There is optional external memory that can be used, which does of course raise the cost. All current FLI2200 implementations as of this writing use the optional memory. If the memory is not used, then film mode detection is disabled and all deinterlacing is video mode. You would never want this in a DVD player, but it would be just fine in a display device (a projection TV). A display device must deal with all kinds of sources, a large portion of it being video. A TV manufacture is always trying to get the costs down because as consumers we like to spend as little as possible. It would be perfectly acceptable to have the FLI2200 in a display running in video mode only. You could then use a progressive DVD player for all of your movies. Of course, this would mean other sources like laserdisc (LD) and VHS would not look as good, but LD and VHS are going the way of the Dodo.