For every image uploaded, Simple WebP creates a WebP version which is served to compatible browsers.
Every time you upload an image, Simple WebP generates a .webp version. It then alter the HTML to replace img tags with picture tags, which let the browser pick the best format.
WebP images are often smaller than original .jpeg or .png one, so can save bandwidth and load time. Most browsers support WebP nowadays. You can use Google Pagespeed tool to see the gain you would get from WebP.
You will get much faster load time, and better ranking in Google Search.
Simple WebP is very much inspired by the more complete (and complex to install) WebP Express plugin. It also use the same libraries :
No, just activate the plugin and enjoy the effects. If you want more settings, use WebP Express.
Yes, it happens. If after the conversion, the .webp version is bigger, it is immediately deleted so it will not be served.
Yes, a polyfill is included.
Simple WebP generates .webp version of images on upload. So your previously uploaded images will not be converted.
However, Simple WebP provide a WP-CLI command to bulk convert all your uploaded image on your server : wp-cli webp-simple-bulk-convert
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No, it works only with uploaded images. Converting theme image requires to set up on demand converting, which is way more complex, and often needs to do manual configuration on the server. See WebP Express.
Yes, it works out of the box with Nginx as long as you serve directly static files.
Maybe. Probably not.
No. But they will not be served anymore.