In the end, arithmetic coding preserves ordering of encoded strings. Thus, comparison operations can be performed on the compressed representation of strings (and big-endian representations of integers and even floating point values), without the need to decompress data until that decompressed strings are needed.
Another view: strings are compared by memcmp as if they are mantissas with the base 256. "hi!" is 'h'(1/256)+'i'(1/256)^2+'!'(1/256)^3+0(1/256)^4 and then there are zeroes to the infinity. Arithmetic encoding represents encoded strings as mantissas where base is 2. Range coding can utilize other bases such as 256.