Comment by throwaway92394

I mentioned it in another comment, but while that does lower the bandwidth of a single frame, its not actually an issue. There's several DRM techniques that can survive a crappy camera recording in a theater.

"compression resistant watermark" turns up some good resources for it. QR codes are another good example of noise tolerant data transmission (fun fact - having logos in a QR code isn't part of the spec, you're literally covering the QR code but the error-correction can handle it).

The best way I can describe it is that humans can still read text in compressed videos. The worse the compression/noise the larger the text needs to be, but we can still read it.