I looked into some aspects of this question for
this article comparing Fast Infoset with gzip. Using GZIP makes a big difference in XML file size, as you might expect from the repeating tags. Unzipping on the receiving end using ZipInputStream adds about 10% to the parsing time. So performance will depend on the relation between network transmission speed and CPU speed.
Note that I did not do a complete SOAP application for that article, I just looked at file sizes and DOM parsing time.
Bill