The AC3 (also known as AC-3) audio format is an audio compression
format commercially released in 1991 by Dolby Laboratories. Better-known as
Dolby Digital sound, the lossy algorithm allows for some discarding of audio
information for the sake of the most efficient data-rate variable signal possible in
digital delivery systems. Some non-Dolby audio formats are AC3-compliant for
home video system compatibility.
Dolby Digital sound is commonly delivered in home video products with audio
channels ranging from 1.0 monaural, 2.0 stereo (with 2.0 mono also being
common), up to 7.1 channels of surround sound, at a encoded at a 48kHz sample
rate ranging from 8 to 32 bits per sample.
Most home video collectors will not hear the differences between a compressed
and uncompressed audio signal.
Dolby TrueHD, an uncompressed lossless audio format, is in use in many of
today’s standard Blu-ray Disc and UHD (4K) Blu-ray Disc home video releases,
with some parallel use of the Dolby Digital format for compatibility with older
home video systems.
More details on the AC3 standard audio format may be found on Wikipedia.
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