It means using less number of bits to store float values. This reduces the memory/compute requirement at the cost of making model less precise.

Reducing the precision of the weights from high precision floating points to either lower precision floats or even integers. You'd think it would greatly reduce the performance of a model, but in most cases the decline in quality is extremely tolerable compared to the reduction in memory/processing requirements.

Reducing the precision of the parameters — result being less memory intensive