The intent of H.264 (MPEG-4 Part 10) was to achieve equivalent quality to previous standards (e.g., MPEG-2) at no more than half the bit-rate. H.264 is commonly felt to have achieved this objective. This document presents results of an HDTV subjective experiment that compared the perceptual quality of H.264 to MPEG-2. The study included both the coding-only impairment case and a coding plus packet loss case, where the packet loss was representative of a well managed network (0.02% random packet loss rate). Subjective testing results partially uphold the commonly held claim that H.264 provides quality similar to MPEG-2 at no more than half the bit rate for the coding-only case. However, the advantage of H.264 diminishes with increasing bit rate and all but disappears when one reaches about 18 Mbps. For the packet loss case, results from the study indicate that H.264 suffers a large decrease in quality whereas MPEG-2 undergoes a much smaller decrease.