Audio Coding-3 (AC-3) represents Dolby’s third innovation in digital audio coding technology. It’s engineered to condense surround sound into a 5.1 channel format, encompassing left, center, right, left surround, right surround, and a subwoofer channel. The first five channels cover a frequency range from 3 Hz to 20,000 Hz, while the subwoofer focuses on low frequencies between 3 and 120 Hz, giving rise to the 5.1-channel configuration. This setup is commonly known as Dolby Digital or, alternatively, Dolby Surround Digital or Dolby Surround AC-3.

AC-3 employs perceptual coding, a technique that exploits the human ear’s limitations by omitting inaudible sounds, thus optimizing compression. The format is highly adaptable in terms of compression levels, typically utilizing 384 kbps for Dolby Surround Sound and 192 kbps for stereo audio.