Apple Final Cut Pro 7 - Manual (Page 1247)

Note: When using a clip’s luma to define transparency, white is used for 100 percent
opacity, and black is used for 100 percent transparency.
The clip now has a
border that matches
the Border.tif clip.
You can further modify this new alpha channel, blurring it with the Mask Feather filter,
for example.
6 Choose Effects > Video Filters > Matte > Mask Feather to apply the Mask Feather filter to
the clip you want to blur.
7 Open this clip in the Viewer, then click the Filters tab.
8 In the Filters tab, drag the Mask Feather filter so it appears below any other filters that
may be creating or modifying the clip’s alpha channel (such as the Image Mask filter that’s
already been applied).
9 Adjust the Soft slider to soften the edge of the clip’s alpha channel.
The clip’s image remains
untouched.
1247 Chapter 72 Keying, Mattes, and Masks