This is an old conversation, but I find that many people still do not know about it.
From Office 97 to 2003 Microsoft used the .doc file extension. These files were binary files. When Office 2007 was introduced, Microsoft change the file extension to .docx. These files are stored in an open XML format. One part of the change is a tremendous reduction in file size. In my organization, we are just now getting people to use the new formats even though Office defaults to the .docx extension.
Microsoft does have some tools to help convert the old files to the new extension. The tool can be found at MS Technet. One example given by a Microsoft employee is that an organization went from 100 file servers to 40 after they changed the file types from the old Office format to the 2007/2010 format. I have seen it first hand reduce file sizes as much as 80%.
