The paper presents a new method for video compression based on the enhanced embedded zerotree wavelet (EZW) scheme. Recently, video codecs from the EZW family which use a 3D version of EZW or SPIHT algorithms showed better performance than the MPEG-2 compression algorithm. These algorithms have many advantages inherent for wavelet based schemes and EZW- like coders. Their most important advantages are good compression performance and scalability. However, they still allow improvement in several ways. First, as we recently showed, using Karhunen-Loeve (KL) transform instead of wavelet transform along the time axis improves compression ratio. Second, instead of the 3D EZW quantization scheme, we offer to use a convenient 2D quantization for every decorrelated frame adding one symbol `Strong Zero Tree', which means that every frame from a chosen set has a zero tree in the same location. The suggested compression algorithm based on KL transform, wavelet transform, and a new quantization scheme with strong zerotrees is free from some drawbacks of the plain 3D EZW codec. The presented codec shows 1 - 6 dB better results compared to the MPEG-2 compression algorithm on video sequences with small and medium motion.