1. A method of decoding an encoded watermark within an image rendered on an image output device, the image output device associated with a pixel grid including a first predetermined number of substantially equally spaced pixels in a first direction, and a second predetermined number of substantially equally spaced pixels in a second direction for rendering the image, and the watermark encoded via pixel spacing modulation, the method comprising: a) scanning the image rendered on the image output device; b) determining one or more image segments associated with the scanned image that include the encoded watermark; c) applying spectral analysis to determine the pixel spacing associated with each of the one or more image segments; d) decoding the image segments to determine the coded watermark, the decoding based on the determined pixel spacing associated with each of the one or more image segments.