What is the H.261 video codec?
The H.261 codec is the first codec in the H.26x family. Today, it's still the most widely used international compression standard for video conferencing (though it isn't the main part of video conferencing anymore - it's used only for backwards compatibility these days). It was developed by the International Telecommunications Union and released in 1988. There were other codecs before this one, for example H.120, but this was the first one to really be usable. All the other H.26 series of codecs use the design principles that first appeared in this codec.
What's unique about the H.261 vieo codec - macroblocks
The H.261 codec is notable for being the first video codec to use macroblocks. Each macroblock in H.261 consisted of a 16x16 array of luma samples and two corresponding 8x8 arrays of chroma samples using 4:2:0 sampling and YCbCr color space.
This codec uses 8x8 discrete cosine transform (DCT) to reduce spatial redundancy. Something unique about this standard is it only specifies how to decode video. So all kinds of different motion estimation algorithms and other concepts were applied to compress and encode the video. Encoders can pre-process in any way they want and decoders can post-process any way they want so long as they decode the video according to the standard. A popular technique still employed today was deblocking filtering. Because this codec uses blocks of pixels to do compression and because it's the first of its kind, the blocks end up looking...well blocky. So to offset that, people use tricks like deblocking filtering or dithering to try to reduce the appearance of the blocks in the final decompressed video.
H.261 as people know it today is very different from how it was back in 1988 -- it went through several revisions to make it a complete standard. One of the more unique features added to it was a backwards-compatible way to transmit still images. To achieve this, images were subsampled horizontally and vertically, dividing the picture into four sub pictures that were sent sequentially to form the complete picture.
H.261 codec today
The H.261 codec is becoming obsolete with newer members of this codec family. However, it's still one of the most popular international standards for video conferencing, so you're likely to see it in use a bit longer while everything converts to using newer codecs. And you'll likely see the basics of the design for H.261 in the rest of the family in the use of DCT and macroblocking.