MP3 is an acronym for MPEG-1 (or MPEG-2) Layer 3 audio encoding (it is not an acronym for MPEG3). MP3 is a popular compression format used for audio files on computers and portable devices.
The compression in MP3 works on the basis of a "psychoacoustic model" which means that parts of the audio that human ears cannot detect are discarded by the encoder. Although this is a LOSSY process, it can yield very high quality audio files are relatively high compression rates.
A typical MP3 file encoded at 128 kbit/s (12:1 compression) is near CD quality.
MP3 audio is increasingly being used in video production coupled with various MPEG-4 video codecs like divx. The audio may be encoded with a constant or variable bitrate.
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