diff --git a/.chloggen/otelarrow-defaults.yaml b/.chloggen/otelarrow-defaults.yaml
new file mode 100644
index 000000000000..4978aec36591
--- /dev/null
+++ b/.chloggen/otelarrow-defaults.yaml
@@ -0,0 +1,27 @@
+# Use this changelog template to create an entry for release notes.
+
+# One of 'breaking', 'deprecation', 'new_component', 'enhancement', 'bug_fix'
+change_type: enhancement
+
+# The name of the component, or a single word describing the area of concern, (e.g. filelogreceiver)
+component: otelarrowexporter
+
+# A brief description of the change.  Surround your text with quotes ("") if it needs to start with a backtick (`).
+note: Adjust defaults for small instance size.
+
+# Mandatory: One or more tracking issues related to the change. You can use the PR number here if no issue exists.
+issues: [35477]
+
+# (Optional) One or more lines of additional information to render under the primary note.
+# These lines will be padded with 2 spaces and then inserted directly into the document.
+# Use pipe (|) for multiline entries.
+subtext:
+
+# If your change doesn't affect end users or the exported elements of any package,
+# you should instead start your pull request title with [chore] or use the "Skip Changelog" label.
+# Optional: The change log or logs in which this entry should be included.
+# e.g. '[user]' or '[user, api]'
+# Include 'user' if the change is relevant to end users.
+# Include 'api' if there is a change to a library API.
+# Default: '[user]'
+change_logs: [user]
diff --git a/exporter/otelarrowexporter/README.md b/exporter/otelarrowexporter/README.md
index 3538bbc4fe73..37859c026133 100644
--- a/exporter/otelarrowexporter/README.md
+++ b/exporter/otelarrowexporter/README.md
@@ -101,10 +101,23 @@ to standard OTLP.
 - `disabled` (default: false): disables use of Arrow, causing the exporter to use standard OTLP
 - `disable_downgrade` (default: false): prevents this exporter from using standard OTLP.
 
-The following settings determine the resources that the exporter will use:
+The following setting determines how long a stream will stay open.
+Stream lifetime is limited to 30 seconds because compression benefit
+is limited at that point and shorter streams make load balancing
+easier.
 
-- `num_streams` (default: number of CPUs): the number of concurrent Arrow streams
-- `max_stream_lifetime` (default: unlimited): duration after which streams are recycled.
+- `max_stream_lifetime` (default: 30s): duration after which streams
+  are recycled.
+
+The following setting determines memory and CPU resources that the
+exporter will use:
+
+- `num_streams` (default: 1): the number of concurrent Arrow streams
+
+The `num_streams` default limits the exporter to one stream, to limit
+resources used by this component.  Larger instances may wish to export
+multiple streams in parallel, in which case `num_streams` can be
+raised up to the number of available CPUs.
 
 When `num_streams` is greater than one, a configurable policy
 determines how load is assigned across streams.  The supported
@@ -229,12 +242,12 @@ The exporter supports configuring compression at the [Arrow
 columnar-protocol
 level](https://arrow.apache.org/docs/format/Columnar.html#format-ipc).
 
-- `payload_compression`: compression applied at the Arrow IPC level, "none" by default, "zstd" supported.
+- `payload_compression` (default "zstd"): compression applied at the Arrow IPC level.
 
-Compression settings at the Arrow IPC level cannot be further
-configured.  We do not recommend configuring both payload and
-gRPC-level compression at once, hwoever these settings are
-independent.
+Compression at the Arrow level is enabled by default because it boosts
+compression slightly and helps Arrow payloads meet gRPC maximum
+request size limits.  Compression settings at the Arrow IPC level
+cannot be further configured.
 
 For example, two exporters may be configured with multiple zstd
 configurations, provided they use different levels:
diff --git a/exporter/otelarrowexporter/factory.go b/exporter/otelarrowexporter/factory.go
index a868fa286d65..98740119145f 100644
--- a/exporter/otelarrowexporter/factory.go
+++ b/exporter/otelarrowexporter/factory.go
@@ -5,8 +5,6 @@ package otelarrowexporter // import "github.com/open-telemetry/opentelemetry-col
 
 import (
 	"context"
-	"runtime"
-	"time"
 
 	arrowpb "github.com/open-telemetry/otel-arrow/api/experimental/arrow/v1"
 	"go.opentelemetry.io/collector/component"
@@ -59,15 +57,14 @@ func createDefaultConfig() component.Config {
 			BalancerName: "round_robin",
 		},
 		Arrow: ArrowConfig{
-			NumStreams:        runtime.NumCPU(),
-			MaxStreamLifetime: time.Hour,
+			NumStreams:        arrow.DefaultNumStreams,
+			MaxStreamLifetime: arrow.DefaultMaxStreamLifetime,
 
 			Zstd:        zstd.DefaultEncoderConfig(),
 			Prioritizer: arrow.DefaultPrioritizer,
 
-			// PayloadCompression is off by default because gRPC
-			// compression is on by default, above.
-			PayloadCompression: "",
+			// Note the default payload compression is
+			PayloadCompression: arrow.DefaultPayloadCompression,
 		},
 	}
 }
diff --git a/exporter/otelarrowexporter/factory_test.go b/exporter/otelarrowexporter/factory_test.go
index 7498a0403dd8..f0dd94f44641 100644
--- a/exporter/otelarrowexporter/factory_test.go
+++ b/exporter/otelarrowexporter/factory_test.go
@@ -6,7 +6,6 @@ package otelarrowexporter
 import (
 	"context"
 	"path/filepath"
-	"runtime"
 	"testing"
 	"time"
 
@@ -38,9 +37,9 @@ func TestCreateDefaultConfig(t *testing.T) {
 	assert.Equal(t, configcompression.TypeZstd, ocfg.Compression)
 	assert.Equal(t, ArrowConfig{
 		Disabled:           false,
-		NumStreams:         runtime.NumCPU(),
-		MaxStreamLifetime:  time.Hour,
-		PayloadCompression: "",
+		NumStreams:         1,
+		MaxStreamLifetime:  30 * time.Second,
+		PayloadCompression: "zstd",
 		Zstd:               zstd.DefaultEncoderConfig(),
 		Prioritizer:        arrow.DefaultPrioritizer,
 	}, ocfg.Arrow)
diff --git a/exporter/otelarrowexporter/internal/arrow/exporter.go b/exporter/otelarrowexporter/internal/arrow/exporter.go
index e42205af197a..d213147fcaeb 100644
--- a/exporter/otelarrowexporter/internal/arrow/exporter.go
+++ b/exporter/otelarrowexporter/internal/arrow/exporter.go
@@ -14,6 +14,7 @@ import (
 	arrowpb "github.com/open-telemetry/otel-arrow/api/experimental/arrow/v1"
 	arrowRecord "github.com/open-telemetry/otel-arrow/pkg/otel/arrow_record"
 	"go.opentelemetry.io/collector/component"
+	"go.opentelemetry.io/collector/config/configcompression"
 	"go.opentelemetry.io/collector/pdata/plog"
 	"go.opentelemetry.io/collector/pdata/pmetric"
 	"go.opentelemetry.io/collector/pdata/ptrace"
@@ -27,6 +28,29 @@ import (
 	"github.com/open-telemetry/opentelemetry-collector-contrib/internal/otelarrow/netstats"
 )
 
+// Defaults settings should use relatively few resources, so that
+// users are required to explicitly configure large instances.
+var (
+	// DefaultNumStreams is 1 which limits network and memory
+	// resources used by this component.
+	DefaultNumStreams = 1
+
+	// DefaultMaxStreamLifetime is 30 seconds, because the
+	// marginal compression benefit of a longer OTel-Arrow stream
+	// is limited after 100s of batches.
+	DefaultMaxStreamLifetime = 30 * time.Second
+
+	// DefaultPayloadCompression is "zstd" so that Arrow IPC
+	// payloads use Arrow-configured Zstd over the payload
+	// independently of whatever compression gRPC may have
+	// configured.  This is on by default, achieving "double
+	// compression" because:
+	// (a) relatively cheap in CPU terms
+	// (b) minor compression benefit
+	// (c) helps stay under gRPC request size limits
+	DefaultPayloadCompression configcompression.Type = "zstd"
+)
+
 // Exporter is 1:1 with exporter, isolates arrow-specific
 // functionality.
 type Exporter struct {