What's housed in a handbag wasting no space (7)

I believe the answer is:

compact

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'space' is the definition.
The answer and definition can be both related to communication as well as being singular nouns.
Maybe they are linked in a way I don't understand?

I can't explain the rest of the clue.

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(Other definitions for compact that I've seen before include "Neatly packed" , "Condense" , "Tightly-knit, agreement" , "What comes initially with CD" , "Make denser, agreement" .)

I've seen this clue in The Irish Independent.

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