Why a separate DAC?


Hello, I have a 3 yr old Yamaha CD player with Burr Brown DAC chip. What are the advantages of having a separate DAC? What would you recommend to compliment and upgrade this for under $1,500? Thank you.

Learning 
128x128phill55
@simao - I have the Yamaha CD-N500 CD Player, 192KHz/32-bit Burr-Brown DAC with Ethernet port for connection to network.
@ mike_in_nc the  Audiolab AAV-MDACPLUS Digital Audio Converter Pre-Amplifier looks interesting, but as everyone has indicated. best to try before I buy ! @ adg101 room treatment is not an option as my wife wants me to keep my system in the living room ro she will never see me (her words :-) ) so I will have to live with the decor. As for my system; Cary Audio LSI-80 Tube Amp, Chinook Phono pre Amp, Linn Sonedek LP12 turntable with Fritz Carbon 7 MkII speakers and  Kimber PBJ cables to system with Cullen speaker cables. Just learning about the new digital world and agree that there have been many updates to the technology. Thanks everyone for your repsonses. 
DAC's are evolving quickly. I would say that if you can output your CD player to an external DAC, do so.
Two companies are my favorites, since they offer upgrades- Ayre and Schiit.
The latter offers the Gungnir and the Yggy, which I think compare nicely with the Ayre Codex. Both are relatively inexpensive. Under $2K used. 
Bob
As you obviously enjoy tube and analog sound, I'd recommend the Mhdt Labs Orchid R2R NOS DAC.  Cost $1100 sold through Linear Tube Audio.  I'd contact them and ask about their return policy to see if you can do an in-home demo.  I think your system will reveal significant differences between this and your Yamaha.  Here's a recent review on 6moons...

https://6moons.com/audioreview_articles/mhdtlab/

If you don't have a digital cable, I'd highly recommend starting with this one as it's very good and very cheap.  You'll need some burn-in time and pay attention to directional arrows. 

https://www.amazon.com/Geistnotes-Apogee-Wyde-Cable-WE-RR/dp/B01N29180M/ref=sr_1_1?crid=CE67OLG5CU63...

Best of luck in your digital journey. 
@gdrnBob I agree the DAC technology is changing quickly. I believe that I can use the Yamaha CD as output to DAC. @soix I really appreciate your advice on the try and buy. Thanks!
I am streaming TIDAL hard wired CAD6 from my modem in my family room to my Apple TV in the living room and have the Apple TV hardwired to my ARCAM AVR550.  I just found out I have not been even hearing 16 bit quality sound.  ARCAM makes a streamer that sells for $250.  Wonder if this can really play 16 bit and 24 bit.

I agree with the person who said he streams TIDAL.  Can't understand why anyone would spend the money on CD's anymore.  TIDAL is really so convenient.