The Bit Rate calculator is for making DVDs only using MPEG2 format and has nothing to do with web video.
If you want to make a video file size smaller, you need to reduce your Bit Rate settings.
However, lower bit rates = lower quality.
You need to experiment with different bit rates to find the level that is acceptable to you, however also remember that YouTube and Vimeo are going to re-compress your video again, so if you compress too far, it is going to fall apart.
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