VP8 is an open source video compression format released by Google. This format is being accepted in many industry applications like HTML5, Web Real-Time Communication, and Video playback in different browsers etc. There is indeed an industry/market demand to support this format at full-HD resolution. This paper proposes the cost effective implementation of VP8 hardware (HW) encoder in terms of time saving in designing most of the complex algorithms. This involves the re-use of most of the H.264 hardware blocks, resulting is cost/area saving of VP8 Encoder. The work also describes the approach on how to adapt H.264 motion estimation, intra prediction & rate control algorithms in VP8 HW encoder implementation and the impact on quality achieved. The experimental results show that the proposed scheme provides comparable quality with Google's VP8 reference Encoder (libvpx 0.9.7 (Cayuga) with “— good — cpu-used=5” settings) [6].