Comment by voxelghost

Author answered below, but dithering techniques like these were common on old computers like the C64 and others, due to the limited ammount of graphics colors available ( 16 colors on C64 if I remember correctly), plus there were usually limitations on how many colors you could use within one 8x8 block , commonly 2 - 1 foreground , and one background color. C64 had a multicolor mode with 1 background, and 3 forground color. But that was still just 4 colors (out of 16 available ) usuable for each 8x8 character block. However switching to multicolor mode took you from high resolution ( 200x320 px) to low res ( 200x160 px) - and yes thats for the entire screen (25 x 40 chars)