Something similar...

AAC is conceptually similar to the ubiquitous MP3 format. Like MP3, it takes advantage of deficiencies in human hearing to discard digital bits corresponding to sounds unlikely to be heard. The human hearing system cannot hear quiet sounds in the presence of loud sounds of a similar frequency; for example, a voice conversation cannot be heard while a jumbo jet flies low overhead. Known as auditory masking, this phenomenon allows the discarding of data with minimal loss of fidelity.

Also like MP3, AAC is a lossy algorithm, meaning the original digital audio cannot be recreated from the compressed bits alone. In terms of audio fidelity, however, there is no loss of data if the compressed audio is properly encoded. AAC claims an advantage over MP3 in this regard: while MP3 requires a bit rate of approximately 256 kilobits per second (kbps) to achieve transparency, AAC can achieve the same quality at 128 kbps. This allows AAC files to be roughly half the size of MP3 files of the same quality, and one-tenth the size of CD digital data.

Seems AAC is better?

AAC provides several other advantages over MP3. It is capable of handling much higher and lower frequencies of sound, provides up to 48 channels of audio, and allows the creation of low-latency audio necessary for two-way communication. For example, AAC can be used for compressing telephone conversations on the fly, whereas using MP3 would introduce delays in the audio. AAC also allows for Digital Rights Management, or DRM, which can be used to control how the audio file is used.

Difference

An area where AAC excels is in low bit-rate compression. Audio books, for example, don't have the dynamic range of music since they consist of little more than spoken word. Potentially, this allows for much higher levels of compression. Using MP3 at such levels of compression produces scratchy, hissy compressed audio not unlike low-quality cassette tape recordings. AAC was specifically designed to handle such applications properly.

AAC is not totally free

Unlike MP3, there is no public, free version of the encoding/decoding algorithms of AAC. All AAC users must license the technology from the VIA Licensing Corporation. AAC is most widely used in Apple Computer's line of iPod portable music players and is part of the next-generation DVD specifications.

how to play AAC anywhere

Use Share DRM Music's Virtual CD Burner to convert AAC into MP3, WAV or plain WMA. Then you may play them anywhere. Share DRM Music use a virtual CD burner to automate the whole procedure of burning / ripping / encoding all in one. What you need to do is just select the virtual CD burner as the default cd burner in your iTunes, then burn the music file you want to convert to DISC. Share DRM Music will do the rest job for you automatically. Download and Try it!