Residual vectors are compressed in a lossless compression scheme suitable for cloud DVR video content applications. Thus, a cloud DVR service provider can take many copies of the same file stored in the cloud and save storage space by compressing those copies while still maintaining their status as distinct copies, one per user. Vector quantization is used for compressing already-compressed video streams (e.g., MPEG streams). As vector quantization is a lossy compression scheme, the residual vector has to be stored to regenerate the original video stream at the decoding (playback) node. Entropy coding schemes like Arithmetic or Huffman coding can be used to compress the residual vectors. Additional strategies can be implemented to further optimize this residual compression. In some embodiments, the techniques operate to provide a 25-50% improvement in compression. Storage space is thus more efficiently used and video transmission may be faster in some cases.