The document discusses implementing the Lempel-Ziv-Welch (LZW) data compression algorithm in VHDL. It summarizes that the LZW technique can compress text, numbers, images, and mixed data by 40-60%, more than Huffman coding, due to its simple logic. The project implemented LZW in VHDL and verified simulation results, compressing 75KB/second on a 1-MIPS machine. Further work aims to improve compression percentage and reduce hardware requirements.