We consider zero-delay source coding with average distortion constraint and
decoder side information. The zero-delay constraint translates into causal
(sequential) encoder and decoder pairs as well as the use of instantaneous
codes. We show that optimal performance is attained by time sharing at most two
scalar encoder-decoder pairs that use zero-error side information codes. Side
information look-ahead is shown to useless in this setting. We further show that
the restriction to causal encoding functions is the one that causes the
performance degradation, compared to unrestricted systems, and not the
sequential decoders or instantaneous codes.