Data compression is a feature which is used to reduce disk storage space and increase the performance of the query by reducing the I/O operations.

SQL Server 2008 supports two types of compression – Row-level compression and Page-level compression.

A row-level and page-level compression takes place on the metadata.

Page level compression results in persisting certain common data that affects rows in a single location.

The compression takes place into number of bits. For example, the length of ‘varchar’ will be stored in 3 bits.