Setting aside some primitive forms of audio compression such as “companding”, the first audio compression standard capable of substantially compressing stereophonic audio (music) with no subjective quality loss was MPEG-1 Audio, published in November 1992. Actually MPEG-1 Audio is a collection of 3 hierarchically related standards.
Layer I, simple but the least performing was designed for the Digital Compact Cassette but later abandoned.
Layer II, more complex but with better performance, is used in Digital Audio Broadcasting (DAB) and as the Audio component of Digital Video Broadcasting (DVB) set top boxes.
Layer III – so-called MP3 –, originally considered very complex but with the highest performance, needs no introduction as it is used in “MP3 players” worldwide.
Dolby markets the AC-3 audio compression technology, typically for set top boxes.
The progress of the MPEG-2 Video standard in the early 1990s prompted the development of a multichannel audio compression standard (MPEG-2 Audio) designed to retaine backward compatibility with MPEG-1 Audio (i.e. an MPEG-1 decoder is able to extract and decode the stereo “component” of an MPEG-2 Audio bitstream).
When it became apparent that this constraint would not lead to a viable standard, an audio compression standard called Advanced Audio Coding (AAC) was developed and published in April 1997. This provided highly performing multichannel audio compression functionality.
AAC, more properly called “MPEG-2 AAC” as it is part 7 of the MPEG-2 standard, was later extended to become the “MPEG-4 AAC” standard, published in October 1998 and widely used over the web and in devices such as the iPod player.
The need to deliver high quality audio in very constrained environments such as mobile networks, prompted the extension of the AAC standard using the Spectral Band Replication technology. The standard is called High Efficiency AAC (HE AAC) of which the v2 is the more performing.
Other audio compression standards are
“MPEG Surround” provides an efficient method for coding multi-channel sound via a compressed stereo (or even mono) audio program plus a low-rate side-information channel
Spatial Audio Object Coding (SAOC) compresses individual audio objects (e.g. voices, instruments, ambience, etc.) in an audio mix, while preserving the possibility for the listener to adjust the mix based on his personal taste
Unified Speech and Audio Coding (USAC) standard achieves consistently better than state-of-the-art compression performance for any mix of speech and music content. Namely USAC performs better that HE-AAC v2 for music and AMR-WB+ for speech.
The very success of digital music enabled by MP3 prompted the development of Ogg Vorbis format claimed to be “a completely open, patent-free, professional audio encoding and streaming technology with all the benefits of Open Source”.