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In this tutorial, the speaker explains how to reduce the file size or image size of a GPG file. He starts by demonstrating the two simple steps to reduce the file size without compromising quality. The first step involves using the built-in option in Microsoft Office picture manager. By clicking on the picture and selecting the "open with" option, you can choose to open it with Microsoft Office picture manager. Once opened, you have the additional option to auto correct the picture. To reduce the picture size, click on "edit pictures" and select "compress pictures." From there, choose the document option and observe the size. After compressing, click OK, close it, and save the file. The original file size in this example is 2.6 MB.