Hi
When you started creating the backup specification, did you check the "Source-side deduplication" box in first screen, at the bottom? On an existing job, you have it in the properties, Options tab.
Before that, you should have configure the source-side deduplication on the device. In the properties of the device, go to "Store and Gateways" tab. In the Gateways section, check the source side deduplication box.
These videos could help:
http://www.youtube.com/watch?v=nb9RQPQZhgE
http://www.youtube.com/watch?v=pxCdQA8AN5M.
Regards
JM