
Display Stream Compression, often abbreviated DSC, is a form of visually lossless compression developed by the Video Electronics Standards Association (VESA) for ultra high definition displays to reduce the bandwidth demand on the links between source material like Blu-ray players, PCs, and games consoles, and displays.
DisplayPort 1.4 with DSC was the first generation of cable to support Display Stream Compression, making the already capable connector even more so and unlocking higher resolutions and refresh rates on compatible displays. It has since been adopted by new-generation HDMI 2.1 connectors too, for the same purpose.
What is Display Stream Compression? It's the technology that makes 8K more than possible today and will unlock even higher resolution displays and refresh rates in the future.
What Does Display Stream Compression Do?
The VESA DSC standard is an important component of modern connectors because it offers a way to improve the available bandwidth of DisplayPort and HDMI cables. It is a visually lossless low-latency compression algorithm based on the YCoCg color space. This means that although its use decreases the bandwidth demands of higher resolution and refresh rate content, it is entirely undetectable by the viewer.
In a practical sense, DisplayPort 1.4 with DSC is far more capable than without it. The base bandwidth of DisplayPort 1.4 remains unchanged at 32.4 Gbps, but where the standard DisplayPort connection can support 4K at 60Hz with HDR and 30 bits per pixel color depth, it can manage either 4K at 120Hz with HDR, or even 8K at 60 Hz with DSC enabled.
DisplayPort hubs with DSC support can also take advantage of DSC to handle a number of ultra-high-resolution displays at once, simplifying multiple display setups, especially at higher resolutions. Check out some of Cable Matters' DisplayPort Hubs.

Mini DisplayPort to DisplayPort and HDMI MST Hub

USB-C to Triple DisplayPort MST Hub
The effect of DSC is even more pronounced with more capable, newer-generation standards. HDMI 2.1 can support 8K resolution at up to around 50 Hz as standard, with 8 bits per pixel color depth, but with Display Stream Compression 1.2, it can manage 8K at up 120Hz, or even 10K at up to 100Hz.
The next-generation DisplayPort 2.0 standard will go further still. Alone it will enjoy a bandwidth well in excess of what HDMI 2.1 can manage, but with support for the newer Display Stream Compression 1.2a, it can handle resolutions and refresh rates far in excess of anything else. It will enable 4K displays at up to 240Hz. There's also the option of two 8K displays running at 120Hz, or a single 16K display at 60Hz.
There are additional advantages for display manufacturers too. Whether the TV or monitor uses a DSC DisplayPort connector, or DSC enabled HDMI 2.1 connection, it can mean a lower manufacturing cost, with reduced need for interconnecting wires, reduced demand on power usage – thereby making stand-alone displays more efficient, or extending battery life in mobile devices – and a reduction in electromagnetic interference.
DSC Over USB-C Could Be the Future
One of the major strengths of the DisplayPort standard, and by extension, Display Stream Compression, is that it can be used by other cables and ports. USB-C and Thunderbolt technologies leverage DisplayPort for their video and audio transmission in DP Alt Mode, and in turn, can make use of VESA DSC for greater resolution and refresh rate support.
Thunderbolt and USB-C cables and hubs already leverage DisplayPort 1.4 with DSC to great effect, making it possible to link up to three 4K displays together using just a USB-C hub.
That's just the start though. As current-generation DSC DisplayPort 1.4 connections can enable 8K over USB-C and Thunderbolt 3, DisplayPort 2.0 will make USB4 and Thunderbolt 4 connections even more capable. With the latest generation of DSC to take advantage of, USB-C monitors of the future could operate at anywhere up to 16K resolution using Display Stream Compression 1.2a over the USB-C connection.
USB-C and Thunderbolt 4 hubs could also leverage DSC for multiple super-high-resolution monitors, including two 8K displays running at 120Hz with HDR, or up to three 10K displays at 60Hz with HDR enabled.
This will also be incredibly useful for laptops with powerful new-generation integrated graphics to massively expand their available screen space without the need for dedicated graphics or a multitude of onboard display outputs. It would also make the daisy chaining of super high-resolution monitors much easier.
For more information on DisplayPort 2.0 and how it will take advantage of DSC, check out the Cable Matters guide to this next-generation connector technology.