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This paper presents a new compression technique for 3D dynamic meshes, referred to as FAMC - Frame-based Animated Mesh Compression, recently promoted within the MPEG-4 standard as Amen-dement 2 of part 16 (AFX -Animation Framework extension). The FAMC approach combines a model-based motion-compensation strategy with transform/predictive coding of residual errors. First, a skinning motion-compensation model is automatically derived from a frame-based representation. Subsequently, either 1) DCT/lifting wavelets or 2) layer-based predictive coding is employed to exploit remaining spatio-temporal correlations in the residual signal. Both motion model parameters and residual signal components are finally encoded by using context-based adaptive binary arithmetic coding (CABAC). The proposed FAMC encoder offers high compression performance with gains of 60% in terms of bit-rate savings relative to previous MPEG-4 technology and of 20% to 40% relative to state-of-the-art techniques. FAMC is well suited for compressing both geometric and photometric (normal vectors, colors...) attributes. In addition, FAMC also supports a rich set of functionalities including streaming, scalability (spatial, temporal and quality) and progressive transmission.