Strictly speaking of audio formats, the best lossy audio format currently is Opus. Unlike other lossy formats, Opus is a HiFi codec that gives a full 20-20kHz audio bandwidth at most bitrates, it supports dynamically changeable bitrates from 6 to 510 kb/s, it uses small frame sizes (20 ms by default) making it an excellent choice for low-latency audio, it supports surround sound up to 255 channels, and best of all, it is royalty free. HiFi mono speech sounds fine at 32 kb/s and is transparent at 48 kb/s. Opus is transparent with stereo audio/music at 128 kb/s (as in "can't tell that it was compressed without the original file and golden ears"). And unlike all other popular lossy audio formats (AAC, WMA, Vorbis, and MP3) Opus maintains this transparency even with very dynamic audio like classical music and nature sounds (types of audio I frequently listen to). Opus is normally stored in the Ogg container, which makes it streaming-friendly. It is a MTI (mandatory to implement) audio codec for web browsers, with support in Chrome, Firefox, and Opera as of this writing. As usual, it's been a standard for 3 years and Microsoft is still holding out. You can test your web browser's audio playback capability here. I am looking forward to the day Microsoft Edge and Apple Safari finally come to 2012 and support this awesome audio codec too (you can help encourage Microsoft by voting for it here). Opus can also be put into MKV, MP4, MTS/MT2S, and WebM, but those combinations are less supported. Windows Media Player can play Opus files after the installation of Shark007 Advanced Codecs (which also enables Windows to play many other formats, including DVDs). I personally use Opus exclusively for all my lossy audio codec needs, falling back on MP3 for web support and WMA for older MP3 players. The easiest way to create Opus audio files is with LameXP, an audio format conversion program. Programmers may like the command-line encoder version by Xiph called Opus-Tools which can convert FLAC or WAV files, and piped PCM streams. A year ago, a public listening test was performed at 96 kb/s. Opus won, followed closely by AAC. Vorbis had some good and bad moments, but MP3 could have passed for mid-anchor if they didn't bump its bitrate up to 128 kb/s, where it basically tied with Vorbis at 96 kb/s. For some reason, they did not test WMA. Probably because WMA has a limited number of bitrate options (hard to normalize bitrates between codecs) and two formats (WMA and WMA Pro). Personally I would rank the popular lossy codecs this way: Opus AAC WMA Vorbis MP3