1. An apparatus (5) of the type having output means and means for generating variable length codewords c(a.sub.i) and c(a.sub.j) responsive to corresponding fixed length codewords b(a.sub.i) and b(a.sub.j), where a.sub.i and a.sub.j are source alphabet characters and where a.sub.i .epsilon. A.sub.1 and a.sub.j .epsilon. A.sub.2 ; comprising in combination: a Markov processor (FIG. 2; FIG. 5-1,21,23,41) for resolving ambiguities by character sequence context recognition arising whenever any ones of a sequence of fixed length characters to be encoded can represent different source characters a.sub.i and a.sub.j drawn from dissimilar alphabets A.sub.1 and A.sub.2, said processor including: an r state register (7); state transition means (23) responsive to a control signal (S.sub.i or S.sub.j) for changing a given present state of the register to one of a preselected number less than r next states (9, FIGS, 1B and 1C), said state transition means including means (9, 11, 19) for generating a second control signal (g); means (31, 33, 35, FIG. 3A) responsive to each fixed length codeword and coacting with said processor for generating an ordered m-tuple comprising at least two variable length codewords and a counterpart control signal (c(a.sub.i), c(a.sub.j), S.sub.i or S.sub.j); and means (37, 3, 9) for selecting and applying one of the variable length codewords from the m-tuple to the output means according to the value of said second control signal (g), said means further including means (1, 41, 21) for applying the counterpart control signal (S.sub.i or S.sub.j) to the state transition means.