"Reading data on demand" with linked files

Hi there,

in the manual it says:

Reading data on demand isn’t supported with compression (this only impacts load time, once loaded there is no difference in memory use).

What exactly does “reading data on demand” mean in this context? I understand that if a linked file is compressed it needs to be fully loaded completely to be unpacked. But when exactly are uncompressed linked files or data pulled from disk? When they are visible? In the viewport? In the Outliner?