Watermarking has become a mature discipline with a foundation in both signal processing and information theory. This book addresses watermarking problems in terms of second-generation insights. It provides a complete overview of the most important results on capacity and security. The Costa scheme, and in particular a simpler version of it, the Scalar Costa scheme, is studied in great detail. An important result of this book is that it is possible to approach the Shannon limit within a few decibels in a practical system. These results are verified on real-world data, not only the classical category of images, but also on chemical structure sets. The text aims to act as a tool for both academic and professional researchers working in the areas of multimedia security, information embedding, and communication. Theory and practice are linked, particularly in the area of multi-user communication. Inspired by the work of Moulin and O'Sullivan, it also addresses security aspects by studying AGWN attacks in terms of game theory.