A ZIP file is a compressed archive format that allows multiple files and folders to be packaged into a single, smaller file for easier storage and transfer. Compression reduces file size, optimizing bandwidth usage and storage efficiency. ZIP files can also be encrypted and password-protected, providing an additional layer of security for sensitive data.

ZIP files are commonly used for sharing large datasets, reducing storage consumption, and organizing related documents into a single archive. In business environments, they streamline file transfers, making it easier to distribute software, multimedia files, or project documentation. Many cloud storage providers offer automatic file compression, reducing the amount of space used while ensuring quick access to archived data.

Cloud-based ZIP file management enhances productivity by allowing users to store, extract, and access compressed files directly within cloud environments.