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We propose a low-delay low-complexity end-to-end video transmission system that integrates the latest scalable H.264 codec and the full-rate full-diversity quasi-orthogonal space-time block codes. At the encoder of the scalable H.264 codec, we have developed a low-delay low-complexity method for the estimation of the video distortion at the receiver for given channel conditions. The distortion estimation algorithm is validated using experimental results. In this work, we show clearly the advantage of using the quasi-orthogonal space-time block codes (STBC), which provide a higher rate compared to the orthogonal space-time block codes in a wireless video transmission system. This is in spite of the use of a non-optimal signal constellation structure. The performance results are obtained after addressing the bandwidth allocation problem that employs the scalable decoder distortion estimation algorithm for the optimal selection of the application layer and physical layer parameters.