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The newest video coding standard called scalable video coding (SVC) provides broad applications in multimedia communications. SVC encoder consumes great computational complexity when compared to previous video coding standards. This paper presents a fast mode decision algorithm that speeds up the SVC encoding process through probabilistic analysis. The mode of the enhancement layer is first predicted by statistical analysis. Afterward, Bayesian theorem is utilized to detect whether the prediction mode of the current macroblock is the best or not. The mode is further predicted and refined by the Markov process. Experimental results show that the proposed algorithm significantly reduces computational complexity with negligible peak signal-to-noise ratio degradation and bitrate increase in the enhancement layers.