You can build the equivalent of the digital filter mechanism that is the front end of Agilent/HP Quadrature Decoder chip within a 22V10 PAL. At that level it is still quite inexpensive.

However since many a design could take advantage of some other logic as well it would be more cost effective to find a 32 or 64 logic cell CPLD as Erik has recommended.

I also have "been there; seen that" regarding trying to use the likes of edge triggered interrupts in order to decode control panel encoders. It does not work well and I question that the percentage is even as high as 99.8% of the time.

-------------

Stephane:

Have you looked at these control panel encoders?

Rotary Optical Encoders

I have used these. They are wonderful parts albeit a bit more costly they offer better resolution and far longer life.

Michael Karas