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Sharon demonstrates how to compress image size while retaining good quality using a software called Image Composer. It is open source and free to use, with the source code available for developers. There are two types of installers - traditional and portable. The portable version is recommended, as it only requires extracting a zip file to start using the software. The download link is provided in the video description. Download the software, extract the file, and start using it to compress image sizes effectively.