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SACD
So far, the audio quality of downloadable music has been almost as good as AM radio. How far does it have to go before you'll want to pay for a download?
At the moment I am downloading lots of songs that I haven't heard in years. I have a fairly substantial CD collection, but since I started downloading music I haven't bought one CD. Sure, the quality isn't perfect, but it isn't bad either. What really appeals to me is that I can sit in front of my computer and think of a song I haven't heard for years, then about 15 minutes later I am listening to it. As for the sound being the same as AM radio, all I can say is that I have never heard an AM radio that sounded that good. As for my 13-year-old son, he is never going to buy any CDs once he can get music from the Internet! To rephrase Dire Straits' hit song: I want my MP3!
Such levels of quality are really limited by the compression schemes and the D/A converters on the PC soundcard. I don't think that people will want to wait 10+ hour for a 400MB audio file to download. Nor will a PC soundcard manufacturer be able to market +$3500 cards that could handle it. I have a good soundcard and PC speaker system already, and, not too surprising, it sounds pretty good, but not as good as my mid-fi Denon components and Polk LS90 speakers. I don't think any sound cardmanufacter will make a PC card to match the DACs in a Wadia or Linn player. You may be able to sell a $3500 CD player easily enough, but a $3500 soundcard that could go obsolete in three months? I don't know if the general public would accept that.
MP3 is marginally adequate for the car, but in the few instances I've tried it on my junior or senior home systems, the results have been horrendous. (Then again, I can't speak to the quality of the transfer vs. the potential of MP3.)
I read on E-Town that there already is a successor to MP3 that is better than CD (96/24 or better) and six channels, and smaller size than MP3. If this is as good as it sounds, then downloads will be a joy. If we have machines (portable and rack) to play the files on CDR.
I don't see how downloads can ever rival CD for quality. As a serious audiophile, recording quality is paramount to me. Also, packaging plays an important part in the whole experience. Downloads take all the fun out of browsing in a music store.
For one thing, the sound quality is already much better then AM radio, and FM as well. (Or at least as good as a strong FM signal.) Although I would like any downloadable music I pay for to be at least CD quality, there is also the issue of price. I will never pay the same price for a downloaded single as I would for the same song on a physical CD, yet most record labels seem to think that people are willing to do this. While they can get away with charging $3.99
If I'm going to pay for it, I want hard copy in my hands. It better be cheap or free if I have to spend my time looking for it, downloading it, and burning my own media. The only exception would be if the record companies used downloads to distribute specialized or out-of-print titles for which it would not be economically feasible for them to manufacture and print discs. Quality should be 16-bit CD quality minimum, otherwise why bother?