A video encoder encodes the video stream frame by frame. An encoding process generally includes receiving a video frame, subdividing the video frame into uniform pixel blocks, comparing a selected pixel block with the corresponding pixel block in a previous decoded video frame to determine which blocks have changed, copying changed pixel blocks into a contiguous memory block, and adding a preamble block, compressing the blocks. This process may be repeated for each frame using a different size pixel block to determine and select a pixel block size that results in the smallest encoded frame.