Performance of a digital image watermarking algorithm, in general, is indicated by perceptual invisibility, data hiding capacity and robustness to some types of attacks. The work reported in this paper uses a novel channel coding, M-band wavelet decomposition and N-ary modulation principle for performance improvement in spread spectrum image watermarking. Watermark casting process may be divided in two steps: in first step a gray scale watermark image is represented by less number of binary digits using novel channel coding and spatial biphase modulation principle. In the second step, the intermediate binary watermark is embedded in selective M-band wavelets channels using N-ary modulation technique. Each watermark bit is embedded in the two different set of subbands having high and low variance values so that faithful decoding is possible against varieties of external attacks. The present investigation has shown that the decoding complexity of higher N-values can be overcome at moderate M-values while robustness performance is maintained at satisfactory level.
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