It can be a practical problem depending on the source: if you're moving from a relatively higher-resolution / less-compressed video it won't be noticeable but if you're starting from video which has already been compressed fairly aggressively it can be fairly noticeable.
One area where this can be important to remember is when comparing codecs: a fair number of people will make the mistake where they'll take a relatively heavily compressed video, recompress it with something else, and get a size reduction which is a lot more dramatic than what you'd get if you compared both codecs starting from a source video which has most of the original information.
One area where this can be important to remember is when comparing codecs: a fair number of people will make the mistake where they'll take a relatively heavily compressed video, recompress it with something else, and get a size reduction which is a lot more dramatic than what you'd get if you compared both codecs starting from a source video which has most of the original information.