Earlier this month, Neil Young made headlines with a biting critique of the state of digital music. In particular, it's the audio quality that bugs Young. Even the highest quality MP3's contain only a fraction of the audio data found in the original master recordings, and industry veterans like Young are concerned that the digital revolution is degrading quality in favor of convenience.

In the same interview, Young also hinted that he had talked to Steve Jobs about a possible resolution, noting that the Apple cofounder was himself a music fan who listened to vinyl records at home.

Now, it appears that Apple may indeed be working on improving the audio quality of music found in its iTunes Store, according to the Guardian. The company is said to be working on a new, high-fidelity audio format that will likely find its way into the iTunes Match service. The files would exceed even the AAC file format in terms of overall audio quality.

The files would be delivered to iOS devices via iCloud based on the capacity and bandwidth of the device. That means that owners of 16GB iPhones and iPads would be limited in their ability to store a great number of albums in this format. Devices with larger capacity, such as the 32 or 64 GB iPad 2 or iPhone 4S, would have an easier time accommodating bigger files.

Will Apple Enter the Streaming Music Game?

It's possible that the new feature could be launched alongside a Spotify-streaming service based on Apple's 2009 acquisition (and immediate shutdown) of LaLa. This is based on anonymous sources cited by the Guardian and not much else. It's entirely possible that Apple used LaLa's technology in building out iTunes Match and has no further plans for it.

There's no timeline for any of this, which of course Apple declines to comment on. All eyes are on the March 7 launch of the iPad 3, which may be accompanied by upgrades to other product lines like the Apple TV (no, not that one).

Digital Audio Quality: An Ongoing Debate

This month wasn't the first time Neil Young has criticized digital audio quality, nor is he the first one to make this argument. Arguments over quality degradation in new music formats go back to the 1880s, when the gramophone was introduced.

In modern times, the debate has shifted to whether MP3s and other digital audio formats are degrading the quality of music when compared to earlier formats like CDs and vinyl. In the case of vinyl, there's no doubt that the analog format preserves more audio data than digital audio. It's just a question of how perceptible the degradation is to the average listener and whether or not they care.

In the last few years, growth in vinyl sales has skyrocketed, outpacing that of CDs and digital downloads. This trend suggests that audio quality is still an important factor for at least some portion of the music-buying population.