This paper presents a study on the effects of various data compression methods from the viewpoint of central computer to terminal communications on a large graphics oriented timesharing system, PLATO IV. The desired goal is to increase terminal display speed without significant increase in the transmission error rates. While the major emphasis in this paper is on text transmission, some discussion of other display functions is included. Chapters provide (1) a description of the PLATO IV architecture and communications system; (2) a review of two projects involving processor based terminals; (3) an explanation of how text is currently transmitted, followed by an analysis of the average number of bits/character obtained by this method; (4) an introduction to the theoretical background for variable length or Huffman coding; (5) projected savings and overhead involved in the use of word lists to reduce the average number of bits/character used to represent text; and (6) conclusions, suggestions for future research, and discussions of projects involving text compression and other methods of improving display speed. (Author/DAG)