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This video tutorial demonstrates how to compress large files to smaller ones using the 7-zip application. By comparing the compression of a 11GB file to 4GB, it is shown that the file size can be reduced by more than 50%. The tutorial recommends using the 64-bit version of 7-zip for faster compression. After downloading, right-click on the file and select the compression level, such as from normal to ultra. Wait until the compression is complete to see the results.