To add a few points to the previous post by Onhwy61, DAC's (digital to analog converters) progressed from 16 bits to 20, and now to the fairly common 24-bit "word". The number of bits refers to the digits to the right of the decimal point. The more bits, the more information that can be recorded for a specific sample of the signal. There are now 32-bit DAC's being used in the most expensive high-end digital equipment. Some manufacturers also use DAC's that convert 20-bit signals to 24-bits during the processing, to avoid rounding errors. This method supposedly maintains the original signal integrity. In addition, the sampling rate (number of samples taken of a signal in a given time period) has increased over recent years from 44.1 kHz (the rate for CD's), to 96 kHz, and there are now DAC's in some high-end products that provide 192 kHz sampling. "24/96", by the way, is the standard used for DVD-Audio and HDCD recordings.