This paper describes and analyses an improved algorithm for hands-free telephony which uses an acoustic echo canceller combined with an additional FIR-filter (called "echo shaping filter") in the sending path of the hands-free telephone. The algorithm controlling the filter is motivated by an approximation of an optimal least squares filter. Simulation results show that the algorithm allows to reduce the order of the echo canceller significantly, still providing high echo attenuation and low distortion of the near end speech signal during double talk. The modulation of the background noise caused by the echo shaping filter can be reduced by adding artificially generated noise to the output signal ("comfort noise").
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