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In this video tutorial, the presenter demonstrates how to reduce the size of an Excel file without using any additional software. By utilizing a built-in feature in Microsoft Excel, the file size is reduced by up to 70%. The process involves opening the file, saving it with a different file type (excel binary workbook), and then checking the new reduced file size. The reduction in size can be significant, as shown in the example where a file went from 20.5 MB to 2.38 MB.