Adobe PHOTOSHOP 6.0 Manual page 329

transparency and you do not know the Web page
background color, or if the background will be a
pattern, you should use a format that supports
transparency (GIF, PNG-8, or PNG-24).
About GIF format
The GIF format uses 8-bit color and efficiently
compresses solid areas of color while preserving
sharp detail, such as that in line art, logos,
or illustrations with type. You also use the GIF
format to create animated images. GIF is
supported by most browsers.
The GIF format uses LZW compression, which is a
lossless compression method. However, because
GIF files are limited to 256 colors, optimizing an
original 24-bit image as an 8-bit GIF can result in
the loss of color information. In addition,
Photoshop and ImageReady allow you to apply
lossy compression to a GIF file. Using the Lossy
option yields significantly smaller files by sacri-
ficing some image quality.
GIF image with 0% dither, and with 100% dither
You can reduce the number of colors in a GIF
image and choose options to control the way
colors dither in the application or in a browser.
GIF supports background transparency and
background matting, in which you blend the edges
of the image with a Web page background color.
About PNG-8 format
The PNG-8 format uses 8-bit color. Like the GIF
format, PNG-8 efficiently compresses solid areas
of color while preserving sharp detail, such as that
in line art, logos, or illustrations with type.
Because PNG-8 is not supported by all browsers,
it may be advisable to avoid this format for situa-
tions in which your image must be accessible to the
widest possible Web viewing audience. For more
information on browser support for PNG,
see your browser's documentation.
PNG-8 files use more advanced compression
schemes than GIF, and can be 10–30% smaller
than GIF files of the same image, depending on the
image's color patterns. Although PNG-8
compression is considered lossless, optimizing an
original 24-bit image as an 8-bit PNG file can
result in the loss of color information.
Note: With certain images, especially those with very
few colors and very simple patterns, GIF
compression can create a smaller file than PNG-8
compression. View optimized images in GIF and
PNG-8 format to compare file size.
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User Guide