They in short throw away some of the pixels and only use some of the original pixels in the video and only render the pixels they didn’t throw away, it’s faster because you have less data to use if you are doing it on your device
YouTube when you upload a video, automatically creates multiple copies of it, each with lower quality, but they average out the pixels for better image quality rather than tossing them, since speed doesn’t matter because you are already doing it in advance. This is why newly uploaded videos sometimes only go up to 360p or something, it takes awhile to do all the resolutions
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