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Regarding videos online, it's a balance between Quality and Performance... you have to find the happy bitrate medium that would satisfy the majority of your customers.
The bottleneck will always be the combination of how fast the user's PC is and how big their bandwidth is.
As someone else mentioned, what you see on HD cable tv is already compressed.. hell you'll even see some HD channels look better than others because there's only so much data that can be pushed through coaxiable cable at a time. Older HD movies on your cable box are usually pushed down at a lower quality than newer "hotter" titles.
Generally big ticket HD sporting events provide some of the best quality HD footage because they are pushed down with a higher encoding bitrate.
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