Whilst it is not stated, this does appear to be a lossy form of compression. As for the part about being better than JPEG, well there are many compression forms that do better than JPEG out there. Crutch being that JPEG is out there free for all to use and has been for a while. Even the updated edition JPEG2000 (
http://en.wikipedia.org/wiki/JPEG_2000 ) is better, yet not as used.
What I do find interesting is that this approach can be done in analogue as well as digital and can be done at time of image capture.
But how much better and the details we all crave are not there.