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external table or gz compressed file

Can somebody please explain me or point me in the right direction for :
how Hive handles gz compressed files, If I create an external table
pointing to a .gz compressed file stored on AWS S3.
Does hive copy the file to the HDFS and decompress it before it uses the
OR does it use the file directly?
If we use a decompressed file stored on S3... does hive still copy the file
to HDFS or read records directly from S3?

Please help me understand the working.

Thanking You,

Ouch Whisper
Sanjay Subramanian 2013-05-02, 17:33