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Understanding Compression
What compressions to use, and why.
In this section, we'll take a look at a few of the most popular compression types and highlight what they should and shouldn't be used for.

JPG Compression

If you compress a jpg that has already been compressed you probably won't see any reduction in file size, in fact, the file may even be bigger!
If you compress a high-quality image with very little compression, you're going to see great savings. This is when Squash really shines.
If you're still unhappy with the amount Squash has compressed your file, do the following: Try lowering the compression rate in the preferences, move it down in 10% increments, then compress the original image again. By doing this you can look at the image after each export and make sure you're happy with the look of the file and its size.

PNG Compression

In our testing, we've found the savings to be made on PNG based images have been fairly small. This is because PNG is a lossless format, so often the best way to save on space is to cut down on the number of colours used. A flat colour png will always be pretty small.
If you don't need transparency in your image, we'd suggest converting the image to a JPG, as you'll probably be able to make the file much smaller.
Only use PNG if the image contains lots of flat colours or you have some transparency in the file you need to preserve. Never save photos as PNGs unless you really need to.
As a rule of thumb, the biggest compression savings to be made are always with high-quality JPGs.