"If image bigger than X use JPEG" for uploads

[robotboy655]

We have this handy option to use JPEG file format if PNG file exceeds a certain size, which I always assumed was broken because I expected this to affect file uploads, not storage. I recently discovered that it only takes effect when saving files to the local drive.

Can we get a separate option that would affects only uploads in the same way?

File storage these days is not a problem, but not everyone has unlimited or fast internet.

[vatterspun]

Similar to something that I think a number of image hosting website already do. Good idea.