When done properly, a good video compressor can reduce the size of a video file to nearly 1,000 times smaller than the original. This is done by using a specific compression algorithm to reduce the total number of bits needed for each frame (or image) contained in the video clip. Hey, that’s a great question! Like compression itself, video compression is the process of reducing the overall file size of a video file or clip. Host your videos (and keep ’em high quality) with Vimeo.