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In this video tutorial by Tiny Technical Tutorials, the speaker demonstrates how to compress images in Microsoft Word. The document being used contains standard lorem ipsum text and multiple photos of buildings, resulting in a file size of 2.8 megabytes for just six pages. The speaker highlights the importance of compressing images to reduce file size, especially for larger documents with more images. The tutorial shows how to compress images by selecting them, going to picture format, and choosing the compress pictures option. This process can significantly decrease file size for easier emailing and sharing.