Partly because PNG is lossless, but also largely because that's not the kind of image that PNG compresses well.
JPEG is a better format (than PNG) to use for photos and similar types of images, because it does an okay job of compressing them and because the compression artifacts are a lot less noticeable. However, JPEG is a really bad format for things like graphics with lots of flat colors or text, because there the compression artifacts are very easy to see. This image from Wikipedia comparing the two shows the difference: http://en.wikipedia.org/wiki/File:Comparison_of_JPEG_and_PNG...
PNG has the advantage of being lossless, and so it performs very well in some situations, but very poorly in others. Photos and images like them are an example of where PNG compresses poorly, because the . PNG actually does outperform JPEG (compression-wise) on some kinds of images though: those with lots of flat colors/text/gradients/etc., and those conveniently end up being the kinds of images where compression artifacts are really visible.
tl;dr: Use the right format for the job. PNG is not good at compressing photo-like images, but does really well at things like diagrams and vector graphics. JPEG is best-used for things like photos where compression artifacts aren't a huge deal.
If you're looking to learn more about how JPEG and PNG compress images, I recommend checking out Smashing Magazine's guides to JPEG and PNG optimization techniques. (I don't usually recommend Smashing Mag articles, but these are both good.) Both will give you some insight into how these things work.
It would be nice to see a more modern replacement, assuming the technology is better. That said, I haven't read enough about WebP yet to know if it actually fixes any of those problems with the JPEG format.
"In fact, of the 16 million colors in the 24-bit true-color pallet, JPEG can only store about 2.3 million colors. That's about 14% of the available color space."
and
"If JPEG stored images using RGB, then the Q tables would cause colors to diverge. For example, blue would have the most loss due to compression so images would appear more reddish and greenish. Instead, images are converted to a different color representation: luminance, chrominance red, and chrominance blue (YCrCb). Changing any one of these values alters the red, green, and blue components concurrently and prevents color divergence."
The article you cited is nonsense. Quantization which causes one of the color channels to get darker is called a "DC shift" and encoders try very hard not to introduce it.
There are no surprising facts, only models that are surprised by facts; and if a model is surprised by the facts, it is no credit to that model.
It is always best to think of reality as perfectly normal. Since the beginning, not one unusual thing has ever happened.
The goal is to become completely at home with [a world where people don't understand the difference between PNG and JPG in 2010]. Like a native. Because, in fact, that is where you live.
- (paraphrased) http://lesswrong.com/lw/pc/quantum_explanations/
--
Calling reality "weird" keeps you inside a viewpoint already proven erroneous. Probability theory tells us that surprise is the measure of a poor hypothesis; if a model is consistently stupid - consistently hits on events the model assigns tiny probabilities - then it's time to discard that model. A good model makes reality look normal, not weird; a good model assigns high probability to that which is actually the case. Intuition is only a model by another name: poor intuitions are shocked by reality, good intuitions make reality feel natural. You want to reshape your intuitions so that the universe looks normal. You want to think like reality.
This end state cannot be forced. [..] But it will also hinder you to keep thinking How bizarre! Spending emotional energy on incredulity wastes time you could be using to update. It repeatedly throws you back into the frame of the old, wrong viewpoint. It feeds your sense of righteous indignation at reality daring to contradict you.
- http://lesswrong.com/lw/hs/think_like_reality/
Whenever I hear someone describe quantum physics as "weird" - whenever I hear someone bewailing the mysterious effects of observation on the observed, or the bizarre existence of nonlocal correlations, or the incredible impossibility of knowing position and momentum at the same time - then I think to myself: This person will never understand physics no matter how many books they read.
Point being, Einstein spent a large part of his career completely unable to deal with the sheer weirdness of quantum physics. ("God does not play dice," "spooky action at a distance," and so forth.)
Ultimately he was able to adapt his worldview to include the implications of quantum theory, but until then he was most certainly not in a state where he would "never understand physics."
It was a great essay, actually, just a terrible lede, as EY himself acknowledged in the comments.
