7-Zip has extreamly high compress rate.
And it is open source software.

You can use 7-Zip on any computer, including a computer in a commercial organization. this is good news for lot of company.
Most of the source code is under the GNU LGPL license. The AES code is under a BSD LICENSE. The unRAR code is under a mixed license: GNU LGPL + unRAR restrictions.

It works in Windows 98/ME/NT/2000/XP. There is a port of the command line version to Linux/Unix.

main features of 7-Zip include:
High compression ratio in new 7z format with LZMA compression
Supported formats:
Packing / unpacking: 7z, ZIP, GZIP, BZIP2 and TAR
Unpacking only: RAR, CAB, ISO, ARJ, LZH, CHM, Z, CPIO, RPM, DEB and NSIS
For ZIP and GZIP formats, 7-Zip provides a compression ratio that is 2-10 % better than the ratio provided by PKZip and WinZip
Self-extracting capability for 7z format
Integration with Windows Shell
Powerful File Manager
Powerful command line version
Plugin for FAR Manager
Localizations for 63 languages

Download it for free from: http://sourceforge.net/projects/sevenzip/

know issues:
current version has some small compatibility problem with RAR fromart.
It do not register file extention by default when you install, so you may need configure the file association by start the program after install.