The MIDI file was developed to allow both musicians and audio developers to transfer MIDI data from one software application to another. The MIDI file contains messages that specify notation, pitch, velocity and control signals for volume, vibrato, audio panning that synchronise tempo between multiple devices. Historically you would have needed four seperate keyboard instruments, but now with MIDI files you can play multiple instruments from a single controller.
MIDI messages are made up of 8-bit words that are transmitted serially at 31.25 kbaud. A MIDI link can carry sixteen independent channels of information, MIDI messages can be channel messages, which are sent on only one of the 16 channels and can be heard only by devices receiving on that channel, or system messages, which are heard by all devices. There are five types of message: Channel Voice, Channel Mode, System Common, System Real-Time, and System Exclusive. There are two variations of the Standard MIDI File format, called Type 0 and Type 1. Type 0 is a single track of data; Type 1 is multi-track.
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MP3 is a digital music format which allows CD tracks to be reduced to around a tenth of their normal size without a significant loss of quality. MP3 gets rid of a lot of the information recorded in a song that our ears are not able to hear and then uses complex algorithms to reduce the file size. This then enables you to get hundreds of songs on to a CD and it also has opened up a new market over the internet - the download market as download times have been significantly reduced.
The MP3 format is a lossy format. That means that an MP3 file does not contain 100% of the original audio information. Instead, MP3 files use perceptual coding. In other words, that means it removes the information that your ear doesn't notice thereby making the file smaller. The reason lossy formats are used over RAW is that RAW audio files are too large to travel over the internet at any great speed. By using lossy formats it enables even dial up users to download mp3 files at a reasonable speed. RAW file formats generally require 176,000 bytes per second compared to a lossy format which requires 17,600. The difference is massive and so are the download times.