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Manufacturer's Report - Dolby Surround Sound AC-3 Update #2 - April, 1995

By William Barnes


In the last issue we mentioned Dolby's new 5.1 channel digital surround system, Dolby Surround AC-3. Just to recap, AC-3 is a high gain coding system which uses the properties of human hearing to digitally represent 5.1 channels of information (five full range channels plus a subwoofer channel - the 0.1 portion) using far fewer bits than are required for common digital systems such as the compact disc. There has been much discussion of AC-3 within the audio industry over the last year or so, and if you read audiophile or audio video (A/V) publications you have no doubt heard about the system. There has also been a great deal of AC-3 activity in the consumer electronics industry recently. AC-3 continues to generate interest in the home theater market and is appearing as the audio system of choice in a variety of applications. The first AC-3 soundtracks have been delivered to consumers' homes on laser disc, and it has become clear that other formats and delivery systems will be bringing more AC-3 sources into the home in the future. In this issue, we are presenting an up to the minute report on the status of AC-3, along with details on the latest format developments.

Laser Discs
The first laser discs with AC-3 audio, Paramount's "Clear and Present Danger" and FoxVideo's "True Lies" were released in the U.S. on January 31 and February 8 respectively. Many additional titles, including "Stargate", "U2 - Rattle & Hum", and "Forrest Gump" are scheduled to be released throughout this year. Laser discs which have an AC-3 soundtrack can be identified by the Dolby Surround AC-3 logo on the disc jacket. It looks just like the regular "Dolby Surround" logo that is used on discs and tapes, but with the phrase "AC-3 Digital" added underneath. These discs will carry the AC-3 bitstream in place of the right analog FM audio channel, leaving the stereo PCM digital tracks untouched. With this arrangement, the left analog FM channel carries a mono version of the soundtrack for backward compatibility with players that have only analog outputs. If the right analog channel (the one containing the AC-3 bitstream) is played back through a standard amplifier input, only digital noise would be heard. Chances are there aren't very many players with only analog FM tracks still on the market, and even fewer being used in a home theater/hi-fi setup, so the mono analog channel should not upset many end users. Also, the analog FM tracks are now officially optional according to the laser disc standard, so there is no requirement to include them at all. When these new laser discs are played on a laser disc player with an AC-3 output, the signal can be fed to an outboard AC-3 decoder which will reproduce the original 5.1 channels. Those who don't have a laser disc player with an AC-3 output can continue to enjoy the Dolby Surround encoded PCM soundtrack. So, if you already have a laser disc player and a Pro Logic decoder, you won't notice anything different about the new discs.

Laser Disc Players
The first laser disc players equipped with an AC-3 RF output are now available from Pioneer and Runco. The addition of the AC-3 output is not expected to significantly increase the cost of players because only a few additional parts are needed. This will make it possible for manufacturers to add an AC-3 output to their entire lineup of new players. There will be a variety of AC-3 ready laser disc players available this year with a wide range of price points. Pioneer has announced a total of seven models for the U.S. market, four to be introduced in April and three in July. The suggested retail prices of these Pioneer players range from $535 to $2,000. The model numbers to look for are the CLD-S304 ($535), CLD-D504 ($660), CLD-D604 ($1,035) and the CLD-D704 ($1,235), all to be introduced in April, and the CLD-59 ($850), CLD-79 ($1,300) and the CLD-99 ($2,000), which will be introduced in July. Runco is also offering two AC-3 ready versions of their LJRII player priced at $3,995 for the basic transport model and $4,995 for the studio transport model.

Next to laser disc, High Definition Television (HDTV) has probably been the most talked about format utilizing AC-3 audio. When the Grand Alliance (the group of companies formed to work out the standards for HDTV) chose AC-3 for the audio system, it caused many other companies to look at AC-3 and consider it in their long term format planning. Certainly, the commitment to HDTV is long term, as it will take many years for HDTV equipment to make its way into the marketplace, and it will no doubt be a long, long time before another television system replaces it (certainly not in my lifetime). Any companies planning to introduce new audio/video delivery systems into the marketplace therefore need to think about how their system will interact with others in the future, including compatibility and economy for the consumer. Using a common audio system means that many different formats can be played back with one decoder, thereby making life simpler and less expensive for everyone. For all of these reasons, the Grand Alliance decision had a major impact on the use of AC-3 in other formats.

The timetable for the introduction of HDTV has been moved back somewhat due to continuing work on the system. In any system of this complexity some delays are to be expected (consider the new Denver airport!) but thus far the schedule has not slipped very much. Initially, there were plans to hold the first HDTV broadcasts at the 1996 Olympics in Atlanta, but the first broadcasts have now been moved back to sometime in 1997. Meanwhile, final testing of the system is scheduled to begin in April of this year at the Advanced Television Test Center, with final system recommendations to be submitted to the FCC later in the year. For those who would like to get an advance look at the system, closed circuit HDTV demonstrations will be conducted at the NAB show in Las Vegas, April 10 through 13.

Direct Broadcast Satellite
AC-3 is continuing to make inroads into the direct broadcast satellite (DBS) market. Currently, the main U.S. service providers are DirecTV and USSB (using the DSS system) and PrimeStar. The DSS system currently uses MPEG-1 audio and video while PrimeStar uses DigiCipher I video and Dolby AC-2 audio. (AC-2, the precursor to AC-3, is a single channel digital audio coding system. Two channels of AC-2 are used for stereo applications, such as the current PrimeStar system. Many of the techniques utilized in AC-3 were first developed for AC-2.) PrimeStar has announced that once new satellites are launched in 1996, their service will upgrade to DigiCipher II video with AC-3 audio.

In another recent satellite development, International Cablecasting Technologies Inc. (ICT) has reached an agreement with the Echosphere Corporation to handle the introduction of DMX Direct, a new Ku band direct to home digital music service which will use AC- 3. DMX Direct is a satellite delivered, 120-channel music service with no disc jockey or commercial interruptions, and is being introduced to the residential marketplace for the first time. Each channel will feature 24 hour a day music in a narrowly defined format, ranging from traditional and contemporary country to alternative rock, symphonic, salsa, movie soundtracks, children's, Cajun, a wide variety of international channels and many more. In this respect, the system will be similar to the current DMX music service that is offered on some cable systems. The development of DMX Direct was inspired by the success of ICT's DMX for Business, which also utilizes AC-3 to provide satellite delivered DMX programming to the commercial marketplace. The new consumer service will reach the entire United States, and will provide access to more than four million C band satellite dish equipped households, as well as additional households that elect to install a smaller mid-power Ku band dish specifically to receive the service. The system will utilize the new DR200 digital audio receiver, which will be manufactured by ComStream.

A similar service was recently introduced in Japan. As Japan's second largest cable music supplier, CAN (Cable Audio Network) System Company Ltd. is installing a new DBS system using Dolby AC- 3. As many as 100 channels of high-quality digital stereo audio will be transmitted via satellite to CAN's ten headends, where they will be converted back to analog for distribution to approximately 500,000 business and consumer subscribers. The new system is also being supplied by ComStream and marks the first such application of Dolby AC-3 outside the United States. Successful testing of the system has been completed, as has evaluation by the Japanese Ministry of Post and Communication, and the new system will be fully operational sometime this year.

Digital Cable
There has been much activity in the cable television industry recently, and Hewlett-Packard has announced that they will provide at least 500,000 cable television set-top converters with AC-3 decoding to Tele-Communications Inc. (TCI) and another 150,000 to ComCast Corporation. These units will contain an ASIC (Application Specific Integrated Circuit) manufactured by LSI Logic Corporation which will be capable of decoding MPEG-2 and DigiCipher II video along with MUSICAM and AC-3 audio. TCI will use the set-top units as part of an interactive cable system that will offer hundreds of channels and a variety of services. This new system is expected to begin operation sometime this year.

AT&T has also entered the cable market with their own cable set-top units, which they call Digital Video Home Terminals. The units, which also feature AC-3 audio, will be supplied to Cablevision Systems Corp. as part of AT&T's Digital Program Delivery System. Plans call for an initial installation of 20,000 units for Cablevision's Long Island, New York, cable operations beginning late in the spring of this year.

igital Video Disc
Dolby AC-3 has been chosen for the next generation digital video disc (DVD) proposed by Toshiba and Time Warner. This 4.7 inch video disc is a two sided format that holds up to 5 gigabytes of data on each side. Variable rate MPEG-2 video coding and AC-3 audio coding are used to enable the disc to store up to 135 minutes of high quality video and audio per side. The audio may consist of multiple soundtracks in either stereo, surround, or 5.1-channel discrete versions. This DVD format was recently endorsed by several hardware producers including Hitachi, Matsushita, Mitsubishi, Nippon Columbia, Pioneer, Thomson Consumer Electronics, and Victor Company of Japan as well as software producers Metro-Goldwyn-Mayer's MGM/UA, Matsushita's MCA Inc., Time Warner, and the Turner Broadcasting Corporation's Turner Home Entertainment. Zenith has also joined the group of DVD proponents by recently announcing their support of the system. It is expected that the first discs and players will be available in 1996, with discs priced in the $20 to $30 range and players priced around $500.

If you have been following DVD developments over the past few months you will know that there is another DVD format being developed by Sony and Philips. The Sony/Philips system does not use AC-3 audio. As the two competing camps have worked to outdo each other, the specifications for each system have changed somewhat, but currently the Sony/Philips version provides 7.4 gigabytes of storage on a single sided, dual layer disc, compared to Toshiba's 10 gigabytes on a two sided disc. The Toshiba system has greater storage capacity (which roughly translates to better quality or longer playing time), but it is two sided which means that either a two sided player will have to be used or the disc will have to be flipped over to access all of the data. Whether or not this will be an issue with consumers remains to be seen. The two systems would also require somewhat different disc manufacturing processes, and each side is claiming that the other's process is complicated and expensive. At this point it appears that both systems will end up competing in the marketplace (another VHS vs. Beta war?) with consumers left to determine the winner. However, if we consider the number of consumer electronics manufacturers and software producers that have endorsed each system, it is clear that Toshiba has the advantage at this stage of the game.

AC-3 Decoders
So, if all of these AC-3 soundtracks are going to be showing up at your doorstep in the coming years, just how are you supposed to listen to them? The first outboard AC-3 decoders, in the form of A/V receivers or preamplifiers, are scheduled to be introduced around August of this year. Several companies, including Denon, Enlightened Audio Designs, Kenwood, Nakamichi, Perreaux, Pioneer, and Yamaha have announced that they will be offering AC-3 decoders in the last half of 1995 or in early 1996. All of these units will also provide Pro Logic decoding, so you don't have to worry about compatibility with existing Dolby Surround programs. The prices on these first decoders will naturally be somewhat high because they are top of the line models, but prices are expected to drop as second generation products reach the market in coming years. Based on preliminary information from manufacturers, typical prices for the first decoders will be in the $4,000 to $6,000 range. However, Pioneer plans to introduce their VSX-D3S A/V receiver with built-in AC-3 decoding this fall at a retail price of $1,925, and this will put AC-3 technology within reach of many home theater enthusiasts.

For those who would like to purchase a Pro Logic decoder now and have the option of adding an outboard AC-3 decoder later, units such as Yamaha's RXV-2090, at a suggested retail price of $1,400, also represent a less expensive way to move up to AC-3. This unit features an AC-3 interface which utilizes the DB-25 connector standard developed by THX for their home THX decoders, and adopted for use with add-on AC-3 decoders. This DB-25 connector may look familiar to many of you, as it is commonly used on computers for the parallel printer port connector. If you purchase a Pro Logic A/V receiver with this connector, you will be able to purchase an add-on AC-3 decoder at a later date and add it to your system. The add-on AC-3 decoder will essentially be a "black box" that takes in the AC-3 bitstream and decodes it into six analog outputs, which are then fed to the A/V receiver via the DB-25 connector. Other models which offer this connector include Onkyo's TX-SV919THX and JBL's Synthesis processor.

Integrated Circuits
The key to widespread use of AC-3 lies in the availability of the integrated circuits which perform AC-3 decoding. Zoran, who developed the first AC-3 ICs, began shipping sample quantities of their ZR38500, ZR38521, and ZR38501 ICs last December. The ZR38500 performs both full AC-3 and Pro Logic decoding for A/V decoder and home theater applications, while the ZR38521 decodes 2 channel AC-3 and MPEG-1 audio. The ZR38501 decodes only 2 channel AC-3 for cable television, DBS or HDTV applications.

Last fall, Motorola announced the 56007, a 24 bit processor capable of decoding AC-3, MPEG-2 audio, and Sony's ATRAC coding system. The 56007 is pin and function compatible with Motorola's 56004 Symphony IC and incorporates all the digital audio peripherals available in the 56004 plus 12 times the program memory and four times the data memory. This allows algorithms such as AC-3 and MPEG-2 to be executed from the on-chip memory. Volume production quantities of the 56007 are expected to be available in April of this year.

Texas Instruments has also announced their development of an AC-3 decoding IC, and they are currently testing the implementation. No availability date for the IC has been announced. LSI and Hewlett- Packard are also continuing development of their ASIC for cable television set-top decoders, and New Japan Radio Corporation (NJRC) recently announced their development of an AC-3 IC. Many other IC manufacturers and algorithm developers are working on processors, and to date, 22 companies have signed AC-3 IC development and implementation agreements. Most of these companies have not publicly announced their plans, so we are not at liberty discuss them, but this widespread interest in developing AC-3 ICs ensures that there will be a wide variety of ICs available for product designers.

Trade Show Demonstrations
Like most other companies in the industry, Dolby attends many trade shows throughout the year and takes advantage of these forums to introduce and demonstrate new technologies. The Winter Consumer Electronics Show (WCES) held in Las Vegas, January 6-9, 1995, marked the first large-scale demonstrations of AC-3 laser disc audio. Eight different companies featured AC-3 demonstrations, including Audio Design Associates (ADA), Denon, Enlightened Audio Designs (EAD), JBL, Kenwood, Perreaux, Pioneer, and Yamaha. The demonstrations used a special laser disc prepared by Dolby Laboratories and Pioneer which contained clips of popular movies and information on the AC-3 system. These demonstrations were enthusiastically received, and from the reactions and comments of those attending, it was clear that they were very impressed. The consensus among listeners was that AC-3 represents a dramatic step forward in home theater sound. Of course, we have known this for some time now, but it's always nice to hear others within the industry say it! AC-3 was also demonstrated at the recent Le Salon Hi-Fi 95 show, a hi-fi and audio/video trade show held March 17-20 at the Palais des Congres in Paris. The demonstrations were held in a high-end audio suite using NTSC laser discs, which are regularly imported from the U.S. into France. We will also be presenting an AC-3 introduction and demonstration at the upcoming Specialty Audio & Home Theater Show which runs from June 17 to 19 in Chicago.

Dolby Digital
The Dolby Digital film system, which provides an AC-3 soundtrack on 35 mm movie prints, continues to grow in popularity and attract the support of the movie industry with many new theater installations and films. As of the end of February, there were over 1,500 Dolby Digital theaters with more than 115 films (over 300 soundtracks, including foreign language versions) released in the format. Upcoming films include "Die Hard: With a Vengeance", "Batman Forever", and "Pocahontas". These are just a few of the 24 movies that have been announced for 1995 release that will feature a Dolby Digital soundtrack. Movie companies are showing increased support for the system, with Warner Brothers recently announcing that Dolby Digital will be the only digital film format that they will support. In addition to Warner Brothers, Twentieth Century Fox has also committed to releasing all future major titles in Dolby Digital.

AC-3 Upgrade Considerations
It seems that with AC-3 coming into the market, many people are concerned about how their existing equipment, or equipment they are in the process of buying, will work with AC-3. Clearly, some new equipment will have to purchased, such as the AC-3 decoder or laser disc player with an AC-3 output, but if you already have a Pro Logic system you will probably be able to use most of your existing equipment. But how might an AC-3 setup differ from a Pro Logic setup? Let's take a look.

The ideal Pro Logic system and the ideal AC-3 system will be very similar. In addition to a Pro Logic decoder, a Pro Logic setup will usually consist of five speakers (left, center, right and two surround speakers), perhaps a subwoofer, and associated power amplifiers. An AC-3 setup will contain all of these components, but there will be some differences in the requirements for the surround speakers. In a Pro Logic system, the surround channel is a limited bandwidth (100 Hz to 7 kHz) monophonic channel, and it is used to create a diffused, atmospheric soundfield around the listener. In order to create a more diffused soundfield, special surround speakers such as dipolar radiators or additional surround channel processing may be used. Although these techniques can help to create the desired effect in a Pro Logic system, they are not necessarily appropriate for an AC-3 system. Because AC-3 delivers a full bandwidth (20 Hz to 20 kHz) stereo surround signal, soundtrack producers will have the option of creating discrete, localized effects within the surround soundfield. The use of speakers or additional processing which diffuses the surround soundfield will limit the system's ability to reproduce localized surround effects. With AC-3, it will be the soundtrack producer's option to create atmospheric surround effects or localized surround effects (or both simultaneously), so the surround speakers should be chosen and placed to strike a good balance between the two.

For these reasons, our recommendations for AC-3 surround speakers are similar to those for Pro Logic surround speakers. For best results, a good quality speaker should be used, such as a two-way bookshelf type, that is well matched to the front speakers. To achieve good matching in the various channels, you may wish to consider a system which uses five identical "satellite" speakers (or speakers that use identical drivers - the cabinets may be different for placement or aesthetic reasons) plus a subwoofer. Even though the AC-3 surround channels will deliver a full range signal down to 20 Hz, it will not be necessary to use large surround speakers which can reproduce these low frequencies because AC-3 decoders will offer the option of redirecting the bass from the surround channels to the front channels or to a subwoofer. The main difference in requirements for an AC-3 surround speaker as compared to a Pro Logic surround speaker will be in the high frequency response. The Pro Logic surround channel only extends up to 7 kHz, while the AC-3 surround channels extend up to 20 kHz. For this reason you should make sure that your surround speakers are capable of good high frequency response when setting up an AC-3 system.

The ideal placement of the surround speakers in an AC-3 system will be the same as for a Pro Logic system; on the side walls, a few feet above ear height (when seated), either directly in line with or slightly behind the seating position. The speakers should be pointed across the room at each other so that they essentially aim straight over your head, not down at it. This placement will allow the speakers to create a ratio of direct to reflected sound which is similar to that found in a theater, and will allow the surround channels to create both diffused atmospheric effects and localized discrete effects. It will also allow the surround balance to remain relatively constant for a wide listening area between the speakers. This is because when you sit to one side of the room, you will be sitting somewhat underneath the nearest surround speaker, which will move you out of its direct radiating field and thus tend to make it sound quieter. Meanwhile, you will have moved into the direct radiating field of the speaker on the opposite side of the room, thus making it sound louder. This will help to correct the balance error that results from moving closer to one of the speakers.

So, for those that are just setting up a Pro Logic system or perhaps already have one, and are concerned about upgrading to AC-3, the things to keep in mind are a) make sure your surround speakers have good high frequency response, and b) make sure your speakers are well matched through the mid and high frequency regions in all channels. In general, this means that AC-3 will require somewhat better surround speakers to achieve full performance from the system.

Available AC-3 Literature
If you would like to read more about Dolby AC-3, there are a variety of publications available from Dolby Laboratories. To request a copy of any of these publications you can send an E-Mail message to or leave a voice message on Dolby's Literature Hotline at 415-558-0344. Please be sure to include your name and mailing address and specify which publications you would like to receive. You may also retrieve most of Dolby's literature from the Dolby Audio/Video Forum on America Online (the keyword is "Dolby").

Dolby AC-3 Publications:
"Dolby Surround AC-3: Questions and Answers" - A non-technical introduction to AC-3 with answers to many common questions. Discusses basic performance specifications for the system and compares it to Pro Logic. 7 pages.

"Dolby AC-3 Multichannel Perceptual Coding" - A moderately technical paper which describes the background behind AC-3, a short history of multichannel sound, how AC-3 was developed, its use in the theater and the home, and an overview of how AC-3 works. 7 pages.

"The AC-3 Multichannel Coder" - A technical paper which describes how the AC-3 encoder and decoder operate. Processing steps described include transient detection, the TDAC filterbank, floating point conversion, carrier precombination, bit allocation, quantization, and data packing. 8 pages.

"AC-3: Flexible Perceptual Coding for Audio Transmission and Storage" - A highly technical paper which describes the AC-3 bit allocation philosophy, filter bank, spectral envelope coding, bit allocation details, bit stream syntax, and system features. 13 pages.

"Parametric Bit Allocation in a Perceptual Audio Coder" (AES preprint #3921, presented at the 97th AES Convention, November 1994) - A highly technical paper which discusses the AC-3 bit allocation process in detail. 10 pages.

"A Single-Chip DSP Implementation of a High-Quality, Low Bit-Rate Multi-Channel Audio Coder" (AES preprint #3775, presented at the 95th AES Convention, October 1993) - A highly technical description of the AC-3 decoding implementation in the Zoran ZR38000 DSP IC. 6 pages.

William Barnes
Dolby Laboratories Licensing Corporation
San Francisco, California

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