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This is something which has baffled me for many years already. I just watched this freshly uploaded video (out of many):

It seriously looks like somebody took a consumer video camera from 1985, smeared grease all over the lens and then recorded the video.

How is it possible to capture such fuzzy video in 2022? Or even many years ago now? I do not understand it. The defaults, or even worst possible settings, seem like they would be infinitely superior to the video's quality.

It's not how they "handle" the camera. It's not because they don't know about XYZ technical stuff. Anyone could record ultra-crisp video in daylight with the cheapest device which isn't even a dedicated camera. Yet this kind of video keeps appearing, where you can't even tell what you're looking at.

What am I missing? How can they look so extremely low-res and fuzzy?

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The short answer is compression. While cameras these days are modern marvels, the images they capture are often encoded, re-encoded, and re-encoded again as they make the trip from the camera sensor to what you see posted online. Think of it like a xerox of a xerox of a xerox. The video you posted was probably recorded in 1080p but compressed down to 240p - roughly the equivalent of VHS tapes - before Youtube then re-encoded it again, removing even more detail.

Obligatory reference: "Do I look like I know what a Jpeg is?"

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