AC3 (Audio Codec 3) is an audio file format developed by the Dolby Laboratories used for storing surround sound audio for playback on modern Dolby Digital 5.1 home theater surround sound systems. For that purpose, AC3 files may contain up to six channels of compressed audio data, with five of them meant to carry information for normal range speakers and a sixth channel being reserved strictly for sub-woofer operation.
Audio data stored in AC3 files is encoded with the Dolby AC-3 algorithm, which is Dolby's third generation audio encoding algorithm. It is a lossy compression algorithm based on the technique of perceptual coding, which produces audio with higher fidelity than the preceding Dolby Pro-Logic technology.
AC3 audio is used on nearly all modern digital mediums like DVD and Blu-Ray. For proper playback, home theater systems need to be equipped with an amplifier compatible with the Dolby Digital technology. On desktop computers proper AC3 support is largely dependent on the sound interface. Certain sound cards cannot interpret AC3 streams properly and output a PCM stream instead, while others come with native support to AC3 surround sound audio. Devices that don't come with built-in support to the AC3 codec can use a software processing application, like the AC3Filter, to be able to provide proper playback to multimedia files containing AC3 audio.
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