• Current music file situation: In the era of iPods with highly compressed music files and iPhones with even lower-quality Pandora streams, some in the music industry are pushing for iTunes and other digital download services to adopt higher-fidelity 24-bit files. Most current digital music is encoded with 16 bits per sample at 44.1kHz (including CDs, MP3s, and iTunes AAC files), while master recordings use 24 bits per sample at 96kHz for a wider dynamic range. Music is further compressed using MP3 or AAC formats with "psychoacoustic modeling" to eliminate less noticeable frequencies.
• Industry efforts and challenges: Record labels are discussing with Apple to offer 24-bit music files. Jimmy Iovine of Interscope-Geffen-A&M and Dr. Dre believe listeners aren't hearing what the artist intended. Universal Music Group is working with Apple to transition iTunes to 24-bit audio, but most iPods and other devices can't play 24-bit files. To play native 24-bit audio, hardware decoders and 24-bit D/A converters need to be reengineered in devices. 24-bit files are larger and take more storage and download time, and could carry a premium price.
• Precedent in digital music market: When iTunes Plus was introduced in 2007 with a higher AAC compression rate and no DRM, the price increased. Later, the price was dropped. While some audiophiles can notice differences in compression rates, most listeners can't, especially on low-end devices. The music industry already provides higher-fidelity formats for a small niche of audiophiles. For the majority of listeners satisfied with low-bit rate streams, a transition to 24-bit audio is unnecessary.