diff --git a/sys/apps/System.lua b/sys/apps/System.lua
index cd22812..b0ebf4d 100644
--- a/sys/apps/System.lua
+++ b/sys/apps/System.lua
@@ -20,7 +20,7 @@ local function loadDirectory(dir)
 	return plugins
 end
 
-local programDir = fs.getDir(shell.getRunningProgram())
+local programDir = fs.getDir(_ENV.arg[0])
 local plugins = loadDirectory(fs.combine(programDir, 'system'), { })
 
 local page = UI.Page {
diff --git a/sys/apps/package.lua b/sys/apps/package.lua
index 8177fbd..e1af0af 100644
--- a/sys/apps/package.lua
+++ b/sys/apps/package.lua
@@ -1,6 +1,9 @@
 local BulkGet  = require('opus.bulkget')
+local Config   = require('opus.config')
 local Git      = require('opus.git')
+local LZW  = require('opus.compress.lzw')
 local Packages = require('opus.packages')
+local Tar  = require('opus.compress.tar')
 local Util     = require('opus.util')
 
 local fs       = _G.fs
@@ -100,6 +103,12 @@ local function install(name, isUpdate, ignoreDeps)
 	if not isUpdate then
 		runScript(manifest.install)
 	end
+
+	if Config.load('package').compression then
+		local c = Tar.tar_string(packageDir)
+		Util.writeFile(name .. '.tar.lzw', LZW.compress(c), 'wb')
+		fs.delete(packageDir)
+	end
 end
 
 if action == 'list' then
diff --git a/sys/init/5.unpackage.lua b/sys/init/5.unpackage.lua
new file mode 100644
index 0000000..6cd4227
--- /dev/null
+++ b/sys/init/5.unpackage.lua
@@ -0,0 +1,27 @@
+local LZW  = require('opus.compress.lzw')
+local Tar  = require('opus.compress.tar')
+local Util = require('opus.util')
+
+local fs = _G.fs
+
+for _, name in pairs(fs.list('packages')) do
+	local fullName = fs.combine('packages', name)
+	local packageName = name:match('(.+)%.tar%.lzw$')
+	if packageName and not fs.isDir(fullName) then
+		local dir = fs.combine('packages', packageName)
+		if not fs.exists(dir) then
+			local s, m = pcall(function()
+				fs.mount(dir, 'ramfs', 'directory')
+
+				local c = Util.readFile(fullName, 'rb')
+
+				Tar.untar_string(LZW.decompress(c), dir)
+			end)
+			if not s then
+				fs.delete(dir)
+				print('failed to extract ' .. fullName)
+				print(m)
+			end
+		end
+	end
+end
diff --git a/sys/modules/opus/compress/lzw.lua b/sys/modules/opus/compress/lzw.lua
new file mode 100644
index 0000000..8434dac
--- /dev/null
+++ b/sys/modules/opus/compress/lzw.lua
@@ -0,0 +1,142 @@
+-- see: https://github.com/Rochet2/lualzw
+-- MIT License - Copyright (c) 2016 Rochet2
+
+local char    = string.char
+local type    = type
+local sub     = string.sub
+local tconcat = table.concat
+
+local SIGC = 'LZWC'
+
+local basedictcompress = {}
+local basedictdecompress = {}
+for i = 0, 255 do
+	local ic, iic = char(i), char(i, 0)
+	basedictcompress[ic] = iic
+	basedictdecompress[iic] = ic
+end
+
+local function dictAddA(str, dict, a, b)
+	if a >= 256 then
+		a, b = 0, b+1
+		if b >= 256 then
+			dict = {}
+			b = 1
+		end
+	end
+	dict[str] = char(a,b)
+	a = a+1
+	return dict, a, b
+end
+
+local function compress(input)
+	if type(input) ~= "string" then
+		error ("string expected, got "..type(input))
+	end
+	local len = #input
+	if len <= 1 then
+		return input
+	end
+
+	local dict = {}
+	local a, b = 0, 1
+
+	local result = { SIGC }
+	local resultlen = 1
+	local n = 2
+	local word = ""
+	for i = 1, len do
+		local c = sub(input, i, i)
+		local wc = word..c
+		if not (basedictcompress[wc] or dict[wc]) then
+			local write = basedictcompress[word] or dict[word]
+			if not write then
+				error "algorithm error, could not fetch word"
+			end
+			result[n] = write
+			resultlen = resultlen + #write
+			n = n+1
+			if  len <= resultlen then
+				return input
+			end
+			dict, a, b = dictAddA(wc, dict, a, b)
+			word = c
+		else
+			word = wc
+		end
+	end
+	result[n] = basedictcompress[word] or dict[word]
+	resultlen = resultlen+#result[n]
+	if  len <= resultlen then
+		return input
+	end
+	return tconcat(result)
+end
+
+local function dictAddB(str, dict, a, b)
+	if a >= 256 then
+		a, b = 0, b+1
+		if b >= 256 then
+			dict = {}
+			b = 1
+		end
+	end
+	dict[char(a,b)] = str
+	a = a+1
+	return dict, a, b
+end
+
+local function decompress(input)
+	if type(input) ~= "string" then
+		error( "string expected, got "..type(input))
+	end
+
+	if #input < 4 then
+		return input
+	end
+
+	local control = sub(input, 1, 4)
+	if control ~= SIGC then
+		return input
+	end
+	input = sub(input, 5)
+	local len = #input
+
+	if len < 2 then
+		error("invalid input - not a compressed string")
+	end
+
+	local dict = {}
+	local a, b = 0, 1
+
+	local result = {}
+	local n = 1
+	local last = sub(input, 1, 2)
+	result[n] = basedictdecompress[last] or dict[last]
+	n = n+1
+	for i = 3, len, 2 do
+		local code = sub(input, i, i+1)
+		local lastStr = basedictdecompress[last] or dict[last]
+		if not lastStr then
+			error( "could not find last from dict. Invalid input?")
+		end
+		local toAdd = basedictdecompress[code] or dict[code]
+		if toAdd then
+			result[n] = toAdd
+			n = n+1
+			dict, a, b = dictAddB(lastStr..sub(toAdd, 1, 1), dict, a, b)
+		else
+			local tmp = lastStr..sub(lastStr, 1, 1)
+			result[n] = tmp
+			n = n+1
+			dict, a, b = dictAddB(tmp, dict, a, b)
+		end
+		last = code
+	end
+	return tconcat(result)
+end
+
+return {
+    compress = compress,
+    decompress = decompress,
+}
diff --git a/sys/modules/opus/compress/tar.lua b/sys/modules/opus/compress/tar.lua
new file mode 100644
index 0000000..4bf04cf
--- /dev/null
+++ b/sys/modules/opus/compress/tar.lua
@@ -0,0 +1,270 @@
+
+-- see: https://github.com/luarocks/luarocks/blob/master/src/luarocks/tools/tar.lua
+-- A pure-Lua implementation of untar (unpacking .tar archives)
+local Util = require('opus.util')
+
+local fs = _G.fs
+local _sub = string.sub
+
+local blocksize = 512
+
+local function get_typeflag(flag)
+	if flag == "0" or flag == "\0" then return "file"
+	elseif flag == "1" then return "link"
+	elseif flag == "2" then return "symlink" -- "reserved" in POSIX, "symlink" in GNU
+	elseif flag == "3" then return "character"
+	elseif flag == "4" then return "block"
+	elseif flag == "5" then return "directory"
+	elseif flag == "6" then return "fifo"
+	elseif flag == "7" then return "contiguous" -- "reserved" in POSIX, "contiguous" in GNU
+	elseif flag == "x" then return "next file"
+	elseif flag == "g" then return "global extended header"
+	elseif flag == "L" then return "long name"
+	elseif flag == "K" then return "long link name"
+	end
+	return "unknown"
+end
+
+local function octal_to_number(octal)
+	local exp = 0
+	local number = 0
+	octal = octal:gsub("%s", "")
+	for i = #octal,1,-1 do
+		local digit = tonumber(octal:sub(i,i))
+		if not digit then
+			break
+		end
+		number = number + (digit * 8^exp)
+		exp = exp + 1
+	end
+	return number
+end
+
+local function checksum_header(block)
+	local sum = 256
+	for i = 1,148 do
+		local b = block:byte(i) or 0
+		sum = sum + b
+	end
+	for i = 157,500 do
+		local b = block:byte(i) or 0
+		sum = sum + b
+	end
+	return sum
+end
+
+local function nullterm(s)
+	return s:match("^[^%z]*")
+end
+
+local function read_header_block(block)
+	local header = {}
+	header.name = nullterm(block:sub(1,100))
+	header.mode = nullterm(block:sub(101,108)):gsub(" ", "")
+	header.uid = octal_to_number(nullterm(block:sub(109,116)))
+	header.gid = octal_to_number(nullterm(block:sub(117,124)))
+	header.size = octal_to_number(nullterm(block:sub(125,136)))
+	header.mtime = octal_to_number(nullterm(block:sub(137,148)))
+	header.chksum = octal_to_number(nullterm(block:sub(149,156)))
+	header.typeflag = get_typeflag(block:sub(157,157))
+	header.linkname = nullterm(block:sub(158,257))
+	header.magic = block:sub(258,263)
+	header.version = block:sub(264,265)
+	header.uname = nullterm(block:sub(266,297))
+	header.gname = nullterm(block:sub(298,329))
+	header.devmajor = octal_to_number(nullterm(block:sub(330,337)))
+	header.devminor = octal_to_number(nullterm(block:sub(338,345)))
+	header.prefix = block:sub(346,500)
+	if not checksum_header(block) == header.chksum then
+		return false, "Failed header checksum"
+	end
+	return header
+end
+
+local function untar_stream(tar_handle, destdir, verbose)
+	assert(type(destdir) == "string")
+
+	local long_name, long_link_name
+	local ok, err
+
+	local make_dir = function(a)
+		if not fs.exists(a) then
+			fs.makeDir(a)
+		end
+		return true
+	end
+
+	while true do
+		local block
+		repeat
+			block = tar_handle:read(blocksize)
+		until (not block) or checksum_header(block) > 256
+		if not block then break end
+		if #block < blocksize then
+			ok, err = nil, "Invalid block size -- corrupted file?"
+			break
+		end
+		local header
+		header, err = read_header_block(block)
+		if not header then
+			ok = false
+			break
+		end
+
+		local file_data = tar_handle:read(math.ceil(header.size / blocksize) * blocksize):sub(1,header.size)
+
+		if header.typeflag == "long name" then
+			long_name = nullterm(file_data)
+		elseif header.typeflag == "long link name" then
+			long_link_name = nullterm(file_data)
+		else
+			if long_name then
+				header.name = long_name
+				long_name = nil
+			end
+			if long_link_name then
+				header.name = long_link_name
+				long_link_name = nil
+			end
+		end
+		local pathname = fs.combine(destdir, header.name)
+
+		if header.typeflag == "directory" then
+			ok, err = make_dir(pathname)
+			if not ok then
+				break
+			end
+		elseif header.typeflag == "file" then
+			local dirname = fs.getDir(pathname)
+			if dirname ~= "" then
+				ok, err = make_dir(dirname)
+				if not ok then
+					break
+				end
+			end
+			local file_handle
+			if verbose then
+				print(pathname)
+			end
+			file_handle, err = io.open(pathname, "wb")
+			if not file_handle then
+				ok = nil
+				break
+			end
+			file_handle:write(file_data)
+			file_handle:close()
+		end
+	end
+
+	return ok, err
+end
+
+local function untar_string(str, destdir, verbose)
+	local ctr = 1
+	local len = #str
+	local handle = {
+		read = function(_, n)
+			if ctr < len then
+				local s = _sub(str, ctr, ctr + n - 1)
+				ctr = ctr + n
+				return s
+			end
+		end
+	}
+	return untar_stream(handle, destdir, verbose)
+end
+
+local function untar(filename, destdir, verbose)
+	assert(type(filename) == "string")
+	assert(type(destdir) == "string")
+
+	local tar_handle = io.open(filename, "rb")
+	if not tar_handle then return nil, "Error opening file "..filename end
+
+	local ok, err = untar_stream(filename, destdir, verbose)
+
+	tar_handle:close()
+	return ok, err
+end
+
+local function create_header_block(filename, abspath)
+	local block = ('\0'):rep(blocksize)
+
+	local function number_to_octal(n)
+		return ('%o'):format(n)
+	end
+
+	local function ins(pos, istr)
+		block = block:sub(1, pos - 1) .. istr .. block:sub(pos + #istr)
+	end
+
+	ins(1, filename) -- header
+	ins(125, number_to_octal(fs.getSize(abspath)))
+	ins(157, '0') -- typeflag
+
+	ins(149, number_to_octal(checksum_header(block)))
+
+	return block
+end
+
+local function tar_stream(tar_handle, root, files)
+	if not files then
+		files = { }
+		local function recurse(rel)
+			local abs = fs.combine(root, rel)
+			for _,f in ipairs(fs.list(abs)) do
+				local fullName = fs.combine(abs, f)
+				if fs.native.isDir(fullName) then -- skip virtual dirs
+					recurse(fs.combine(rel, f))
+				else
+					table.insert(files, fs.combine(rel, f))
+				end
+			end
+		end
+		recurse('')
+	end
+
+	for _, file in pairs(files) do
+		local abs = fs.combine(root, file)
+		local block = create_header_block(file, abs)
+		tar_handle:write(block)
+		local f = Util.readFile(abs, 'rb')
+		tar_handle:write(f)
+		local padding = #f % blocksize
+		if padding > 0 then
+			tar_handle:write(('\0'):rep(blocksize - padding))
+		end
+	end
+end
+
+local function tar_string(root, files)
+	local t = { }
+	local handle = {
+		write = function(_, s)
+			table.insert(t, s)
+		end
+	}
+	tar_stream(handle, root, files)
+	return table.concat(t)
+end
+
+-- the bare minimum for this program to untar
+local function tar(filename, root, files)
+	assert(type(filename) == "string")
+	assert(type(root) == "string")
+
+	local tar_handle = io.open(filename, "wb")
+	if not tar_handle then return nil, "Error opening file "..filename end
+
+	local ok, err = tar_stream(tar_handle, root, files)
+
+	tar_handle:close()
+	return ok, err
+end
+
+return {
+	tar = tar,
+	untar = untar,
+	tar_string = tar_string,
+	untar_string = untar_string,
+}