In this paper we describe the ongoing work on a new paradigm for compressing the motion predicted error in a video coder, referred to as MMP-Video. This new coding algorithm uses the multidimensional multiscale parser image coding algorithm to encode the residue error, in a H.264/AVC based video coder. MMP has shown to perform very well as a universal still image coding method, particularly when it is combined with intra prediction schemes. In addition, previously published preliminary results have also presented MMP as a promising video coding method. In this paper, we propose new dictionary updating techniques for MMP-video. Along with other functional optimizations, these techniques allow for a significant improvement in the encoder performance. Thus, we were able to achieve considerable gains over H.264/AVC for B slices, specially for medium and high bit-rates, while maintaining equivalent performance for the P slices.