So he is saying that you don't need to store all the data, just its most common learnt representations. Isn't that a fancy way of saying online learning or summary statistics?
It is online learning, but as far as I understand, there is another side to it. Right now, if you get a new data stream, you have to play around to build the right models for it (mostly manually, with trial and error) before you do online learning. As the number of data streams grows, this doesn't scale well. Their algorithm adapts online to the data stream without you having to design any model.