Scope: Yosemite Server Backup 8.x and above
Hardware compression is supported by a number of backup devices. It is generally described by having two capacities for the media in question, i.e. LTO 3 has a native capacity of 400 GB, but is described as 400/800 GB Media. The 2:1 ratio is simply an industry standard or 'average' and not a guarantee. Hardware compression, as implied, is handled by the backup device. This offloads some of the processing of the machines being backed up but also means that the data transferred from the client to the device is uncompressed.
Software compression is generally used with virtual devices, or devices that do not natively support compression, such as RDX Devices. Software compression is handled on the Client, and is sent to the device already compressed. The main difference you will notice is that the size reported within the backup job is the size after compression. This also means that the data transferred from a client to the device is also the compressed size. Because of this, the difference in backup time between hardware and software compression is negligible.
Please see Solution #00006596 regarding how to enable software compression.
Link to this page:https://campus.barracuda.com/solution/501600000013lBKAAY