It may have been mentioned earlier, but the ATV3 is just passing the Dolby ac3 track on to the receiver for decoding (referred to by others as "passthrough"). With the new ATV 4 gen, the ATV itself is now doing the decoding onboard and passing the resulting audio as raw PCM down to the receiver**. After many hours working to port my own surround content over to the ATV 4, I've noticed several things happening to this processed audio:
1. Overall output is lower compared to the same track output from the ATV3. (not a big deal in and of itself...)
2. Subtle compression is being applied to the audio (even with "reduce loud sounds" off), resulting in the potential loss of dynamic range (the amount of compression varies with content).
3. Perceived reduction of audio quality. (Musical content seems to lack the "punch" and "clarity" when compared to the ATV3.)
Original master recordings were used to directly compare the side-by-side output from both the ATV3 and 4 gen models.
Anyway, I hope this helps clear up a bit of the confusion with how the ATV4 currently processed Dolby tracks, as well as encourages users to send feedback to Apple about improving the surround sound audio quality for the new Apple TV.
Jeff
*Bug reports were primarily focused on provable "unwanted compression". Audio quality is more subjective in nature and thus, can be difficult to quantify in a bug report...
** EDIT: If you select "Dolby Surround" in the ATV Audio settings, the ATV will (apparently) encode the processed audio back and output a new Dolby Digital stream.
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