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A significant cost in PPM data compression (and often the major cost) is the provision and efficient coding of escapes while building contexts. This paper presents some recent, preliminary, work on a new technique for eliminating escapes in PPM compression, using bit-wise compression with binary contexts. It shows that PPM without escapes can achieve averages of 2.5 bits per character on the Calgary Corpus and 2.2 bpc on the Canterbury Corpus, both values comparing well with accepted good compressors. Copyright © 2011 John Wiley & Sons, Ltd.