I've added a PS to my previous post. The Jpeg format was never designed to be a suitable medium for all types of images. It was designed to throw away what you may not notice has gone. Principally it caters for photographs which do not have hard (sharp ) edge definition. It makes a very bad job of small black text on a white background with lots of diagonals giving lots of jpeg artefacts. Basically the image is broken down into patterns and reconstructed from the same group of patterns. You will note from the illustration in the previous post that the patterns are formed from vertical and horizontal lines only and this is why diagonals are not reconstructed well.
The Jpeg2000 format is far more complex and uses wavelets to de-construct and reconstruct the image which gives better compression and image quality. The uptake of this format has been very slow for a number of reasons and may not become the replacement for the older jpeg format it was hoped for.
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Rob
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