[flohofwoe]

This was already a common technique back in the 90's for loading asset data in games and even more important than today with fast SSDs. Instead of many small files, the asset data is loaded from a single big compressed archive file, this works around the terrible small-file-performance (mainly in Windows file systems), and it speeds up loading because loading the compressed data and decompressing is much faster than loading the decompressed data directly from the slow disc.

[Someone]

A variation on this also still is extremely common in the case where the ‘file system’ is a web server and the program accessing it a web browser (https://css-tricks.com/css-sprites/)

In that case, there typically isn’t additional explicit compression (1). The main gain is in decreasing the number of http requests.

(1) the image itself may have inherent compression, and that may be improved by combining images with similar content, and the web server may be configured to use compression, but the first typically isn’t a big win, and the second is independent from this strategy.