yes check out
www.divx.com
i'm managing to get 1minute clips down to around 5 or 6meg with very high quality, its not much degraded from the original source, i have reduced the size down a little to 640x480 pixels,
i use a divx codec for video compression and an mp3 codec for audio compression, you can get these on the web if you look around.
you should try encoding using multiple passes to get the best quality, I use virtualdub as the editing software, this can be gotten from the web too.
you may also be interested in
www.doom9.org for lots of useful advice etc for video editing/compression etc etc
-rcladin