The compression directive sets which compression method will be used when a message is big and compression is needed.
It could be either zlib or bz2, depending on whether you have the corresponding library in the system. You can check /usr/lib/heartbeat/plugins/HBcompress to see what compression module is available.
If this directive is not set, there will be no compression.
compression <bz2/zlib>
This information provided courtesy of the Linux-HA project at http://linux-ha.org/