1. A method for encoding a video signal having at least one frame with a plurality of blocks having pixels, comprising: determining motion vectors for a first block in the at least one frame and at least some of the blocks that are neighbors to the first block; identifying neighboring blocks having motion vectors that are similar to the motion vector of the first block; assigning the first block and the identified neighboring blocks to a segment using a processor; applying a segment parameter to at least one block in the segment; and encoding the at least one block using the segment parameter.