Fraunhofer, the creator of the MP3 and MPEG-H, shows me the innovations coming to audioFraunhofer IIS occupies a central place in the history of digital audio. As the German-based institute behind the MP3 audio format and a major force in the evolution of AAC, it now combines that legacy with advanced research in immersive sound and technologies such as MPEG-H, designed to make listening more flexible, immersive, and adaptive.
MPEG-H pushes audio beyond the idea of a fixed stereo or surround mix. By working with audio objects and dynamic metadata, it allows content to adapt to different playback systems and listening situations, from immersive speaker arrays to soundbars, TVs and headphones.

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During a visit to Fraunhofer IIS in Erlangen, that evolution came into focus in conversation with Bernhard Grill, the institute’s managing director and a member of the core group involved in the development of MP3. He describes his contribution as helping turn research that was still largely academic into something capable of operating in real-world conditions. That reflects one of Fraunhofer’s core principles: research is meant to be applied in the real world.
From that perspective, Grill can compare two very different technological eras. In the days of MP3, development could be handled by a small team and a relatively contained level of complexity. Today, the situation is very different. “MP3 could be done with a small team of maybe five people. At its peak, MPEG-H had close to 100 people working on it.” The remark is about more than scale. It points to a change in how innovation itself works: no longer the product of a small, tightly focused group, but of much larger, more specialised, and more distributed efforts. As Grill puts it, “It’s getting harder to make a difference for the next generation and just things get more complicated, but at the same time hardware gets more powerful.” Innovation has not stopped; its scale, pace, and conditions have changed.
Bernhard Grill, managing director of Fraunhofer. Image: Press
That growing complexity requires not only larger teams, but also an environment able to keep up with it. Europe, Grill argues, is beginning to lose ground against China and the US because bureaucracy is slowing progress: delayed purchasing processes, regulatory requirements, and, above all, restrictions on the use of AI that force researchers to spend time on forms instead of working on the technology itself.
Fraunhofer IIS still preserves the first MP3 player in history. Its storage capacity was limited, but the device remains operational, and it was even possible to hear it during the visit. It carries an obvious historical weight — a small artifact tied to a much larger transformation in the way music could be stored, carried and listened to.
The path to that transformation, however, was far from straightforward. In its early years, Fraunhofer was not the globally recognised institution it is today. In fact, as Grill recalls, they were seen as underdogs in a context where the industry distrusted their technology, considered it too complex, and doubted its viability in the mass market. The project’s survival depended in part on small jobs and contracts that kept the team together while they tried to push forward with a technology that almost no one fully took seriously.
The first MP3 player. Image: Press
MP3 was one of the decisive pieces of that transition, though not the only one. AAC is also part of Fraunhofer’s story and of the broader evolution of compression formats that shaped contemporary digital audio. From there emerged a new era that transformed the circulation of music altogether. Piracy became one of the most visible consequences of that shift, even though it was not something attributable to the team that developed the technology. Grill even recalled the industry’s early hostility: “They had a lot of lawyers trying to find something which we could be accused of in front of a court, but obviously nobody was able to find anything where they would actually be able to attack us with.” More than a fault of the team, it was one of the side effects of a much larger mutation: the transition to a world in which sound could be copied, shared, and moved with unprecedented ease.
The history of MP3 cannot be separated from the technical and cultural context of its time. Memory was expensive, connections were slow, and digital audio still had to solve concrete problems of transmission and storage. Fraunhofer understood early on that the internet was going to transform the circulation of sound, and that this would require efficient compression. The arrival of computers capable of playing MP3s without dedicated hardware, along with the spread of the internet and CD drives, ultimately brought together the conditions for the technology to expand in unstoppable fashion.
But if MP3 responded to the problems of an era marked by expensive storage and slow connections, the institute’s present points toward a different challenge. The issue is no longer simply how to compress audio efficiently, but how to redesign the listening experience more broadly.
Mozart room. Image: Press
Part of that work can be seen in the Mozart room, one of the institute’s most striking spaces. It is not simply an immersive listening room, but a validation and acoustic development environment built with an extreme level of detail. It is designed as a room-in-room construction, with a floating floor, double walls, double doors, and an air-conditioning system engineered to move air very slowly so that airflow itself does not generate unwanted noise. Inside, the room is equipped with around 40 loudspeakers positioned at different heights. The middle ring can be raised or lowered and is set at the listener’s ear level. Other speakers are placed above the listener’s head and others closer to the floor, so that spatiality is built not only horizontally but vertically as well.
Ulli Scuda, Head of Group Soundlab, guided part of the visit and explained aspects of the room’s physical structure. Even the large ring and the aluminum supports holding part of the system were specially designed to avoid vibrations that could interfere with reproduction. Because the truss is hollow, certain frequencies can make it resonate, so it was filled to prevent that.
The room’s central function is to serve as a space for listening tests: comparative sessions in which a person, positioned in the ideal listening spot, evaluates differences between signals, technologies, or sound treatments. Those comparisons, repeated and statistically processed, help determine whether a development truly improves the listening experience or whether the difference is inaudible.
Bach room. Image: Press
For a domestic environment, Scuda said that a 7.4 configuration offers a particularly convincing spatial image. In that setup, the four additional speakers are placed above the listener, reinforcing the sense of height and immersion. Beyond larger systems such as 22.2, used by NHK in Japan, 7.4 stands out as an especially interesting option for home use because it can reproduce spatiality powerfully without requiring extreme infrastructure. Scuda also explained that side positions are especially important for reproducing reverberation and spatial detail — for example, in recordings of churches or cathedrals, where the surrounding environment is an essential part of the experience.
This is where MPEG-H reveals one of its most concrete strengths. The system is not just about improving fidelity, but about transforming the listening experience through audio objects and dynamic metadata. It allows language switching without losing the ambient background, lets listeners adjust background and dialogue levels separately, and enables further customisation and track selection depending on the options defined by the provider.
That becomes even more significant when the technology is no longer confined to laboratories or demo rooms. In Brazil, MPEG-H has been gradually incorporated through trials, pilots, and concrete adoption by broadcasters and technology partners, until it became part of the new TV 3.0 framework formalized by decree on August 27, 2025. That matters because it shows the system has already found real paths into mass media environments.
This implementation does not depend only on a broadcaster adopting the format. It also requires integration into televisions, soundbars, set-top boxes, mobile devices, and streaming platforms. That is precisely why Brazil became such a relevant case. Fraunhofer worked with broadcasters such as TV Globo on tests and real productions, first with direct support and later more autonomously, as local teams absorbed the technology and learned to operate the system on their own.
Sound in MPEG-H also adapts to the playback medium. Even when it is heard through headphones, certain configurations can simulate rear spatiality through binaural processing. In other words, part of that three-dimensional complexity can be transferred to more accessible and everyday listening formats.
In that sense, one of the most interesting things about Fraunhofer IIS is that it does not maintain a strict divide between engineering and musical sensibility. Mandy Garcia, Head of Marketing and Communication, put it simply: “A lot of people that work here are also musicians. Passion for music is what connects a lot of people working here.” That is not a minor detail. It helps explain why audio in a place like this is not understood only through engineering, but also through lived experience as listening and musical practice. The institute even has a rehearsal room in the basement, along with bands formed by colleagues who play together at internal events.
That may be why the visit leaves a double impression. On the one hand, there is the historical weight of an institution that contributed to some of the most important changes in the recent history of recorded music. On the other, there is the evidence that its current work is no longer focused only on compression or efficient transmission, but on a broader question: how we want to listen in the future.
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