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This paper presents a new compression technique for 3D dynamic meshes, referred to as FAMC - frame-based animated mesh compression, promoted within the MPEG-4 standard as amendment 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 computed from a frame-based representation and then encoded. Subsequently, either 1) DCT/lifting wavelets or 2) layer-based predictive coding is employed to exploit remaining spatio-temporal correlations in the residual signal. The proposed encoder offers high compression performances (gains in bit rate of 60% with respect to the previous MPEG-4 technique and of 20% to 40% with respect to state-of-the-art approaches) and is well suited for compressing both geometric and photometric (normal vectors, colors...) attributes. In addition, the FAMC method supports a rich set of functionalities including streaming, scalability (spatial, temporal and quality) and progressive transmission.