You don't have to be an audiophile to be interested in different audio formats. You just have to care about the quality of your music. There's nothing wrong with understanding all the various types of audio formats with which you can save your music. The main audio formats used in audio players are MP3 (which almost everyone is familiar with), FLAC, and AAC. While most users will not use FLAC very often, the other audio formats are very, very common.
the main benefit of using MP3 files is that they are incredibly compact and do not lose a noticeable degree of audio quality. Audio compression works like this: the higher and the lower end of the audio spectrum are cut off in a way that does not noticeably degrade the audio quality. The human ear has limits to how much fidelity it can actually detect. These limits are cut off on the low-end and the high-end of the audio spectrum. So, ostensibly, when you cut off the high end and the low ends, it is not very noticeable. However, the less compressed the audio file is, the better the audio quality.
Another benefit of MP3 audio compression is that they can be used in just about any player. Almost every audio player supports MP3. This means that your audio files, while not perfectly high fidelity, are highly portable from one device to another.
Apple developed its own file format called AAC. AAC works in the same way that MP3 does, although it uses a more efficient and effective manner of compression. This means that, for the same quality of audio, your files will be smaller. This type of audio compression is perfect for users to want to store a large amount of music in a limited space, such as in an MP3 player, iPhone, or iPod. However, keep in mind that fewer devices support AAC then support MP3. This means that your audio data will be less portable that it is in MP3.
For most users, FLAC is the most inexplicable and out of reach audio format. This is because it is difficult to play, and fewer devices can play it. For example, iTunes does not support FLAC audio files, and even WinAmp requires an additional plugin in order to play FLAC files.
Often, audiophiles convert FLAC into another audio format, such as WAV. FLAC, which stands for free lossless audio codec, is exactly what it sounds like: a free audio codec that does not cut off any audio fidelity.
Unlike MP3s, FLAC files do not cut off the high and the low ends of the audio spectrum. However, they remove inefficiencies in the file format so that the files can be smaller. Audio files care immensely about the pristine nature of their audiophiles, just want to store a lot on terabytes of hard drives, tend to do so in FLAC format.
This is because FLA, for these individuals, strikes the perfect balance between high fidelity audio and small FileSize. Most users, however, needn't bother with FLAC and will be just fine with MP3 or, if space is an issue, AAC.