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In this video tutorial, the creator demonstrates how to reduce the file size of an image using Microsoft Office Picture Manager. The original file size is 2.6 MB, and by following two simple steps, you can decrease the file size without compromising the quality. The first step is to open the image in Microsoft Office Picture Manager, where you can choose to auto correct the picture. After that, click on "Edit Pictures" and then "Compress Pictures" to reduce the file size. Finally, save the compressed image to lower the file size effectively.