[omegalulw]

> This is done whenever a system or algorithm converts data from higher dynamic range representation (more bits per quantum of signal, like a pixel or audio sample) to a lower dynamic range representation, it's called a bit-depth reduction.

You are mixing two things here? Bit depth reduction is a specific term, it refers to the reduction in the amount of information you want to _convey_.

Compression is be reducing the number of bits/pixel averaged across the whole image. Good compression algorithms will not be spatially uniform, it's entirely possible that pixels in some parts of the image are compressed with more bits/pixel than pixels in other parts.

[duped]

I took care not to conflate the two and to isolate the terms outside the context of compression, and image processing at large.