This wouldn't work well because in the frequency domain representation, different "pixels" have very different importance for the overall appearance of the image: The pixels at the center of the frequency domain representation represent low frequencies, so compressing them will drastically alter the appearance of the image. On the other hand, the corners/edges of the frequency domain representation represent high frequencies, i.e. image details that can be removed without causing the image to change much. That's the crucial benefit of the Fourier transform for compression: it decomposes the image into important bits (low frequencies) and relatively less portant bits (high frequencies). Applying compression that doesn't take that structure into account won't work well.