Video Compressor - iPhone app

With regard to recording quality iPhone has now become a serious competitor of digital video cameras since the introduction of iPhone 4. But what still bother us is handling the huge video data gets iPhone very slow. Sometimes you can't send videos because their size is exceeding the limit, or even if you can, it takes time. In addition to that if you want to store a lot of video data you took in your iPhone, the storage space might not be enough.

Video Compressor (free) - iTunes

Here is the good app for you. This app simply reduce the size of full HD video contents you captured with Camera app by over 90%.

When you start the app, you'll see this screen where you select the level of compression from these three.
Of course HD 720p is higher quality and bigger size video format, so there's no way that compressing into HD reduce 90% while into VGA reduce 80% is correct description. (below image is taken from the app's preview page on iTunes, but the numbers are incorrect.)
After testing both, it turns out HD reduce about 80% and VGA is 90%, so the numbers are opposite.

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Now you selected a compression type, then you select a video you want to compress from CameraRoll and click 'Choose'.

HD quality compression has the best result reducing almost 80% of the data size without significantly compromising the image quality - think about it, HD 720p is the recording format of iPhone4.
VGA is the quality of front camera. If you don't need to keep tiny details clear, VGA is a nice option, but you 'd better avoid Low Quality. It would hurt your eyes.