MP3, officially known as MPEG-1 Audio Layer III, is an audio subset of the 1992 MPEG-1 standard. (Layer III also received some enhancements in the MPEG-2 standard.) MP3 files were front and center in the digital music revolution of the 1990s and gained notoriety through their open sharing on peer-to-peer networks.
The MP3 format has been particularly popular because it can produce ``near CD'' quality3.13 audio at a compression rate of 11 to 1. In other words, one minute of compact-disc audio, which requires about 10 MB of storage, can be compressed to an MP3 file smaller than 1 MB. Despite the development of compression formats that produce better sound quality at identical bitrates--such as AAC and Ogg Vorbis--MP3 remains the most popular audio format on the internet, and it has become the lingua franca of personal digital audio players.
Although the specifications of the MPEG standards are open and freely available, the Fraunhofer Institute and Thompson Multimedia--the companies that helped finance the development of the standards--hold patents on many of the algorithms used to code and decode MPEG files.3.14 In 1998, when the Fraunhofer Institute issued a letter stating that it would begin charging royalties to developers of MP3 encoders, some distributors removed MP3 codecs from players, and some developers decided to begin work on truly open formats, such as Ogg Vorbis (see below).