NOTE: If you have not already read the article on Digital Audio File Formats you should do so before reading this page.
There are 3 primary situations in which you will need to compress audio ...
As you are no doubt aware, MP3 is the current dominant file format for the web. Its popularity makes it the best choice and almost guarantees compatibility with all internet end-user systems.
Many people use iTunes to convert uncompressed CD quality audio into MP3 files but almost all audio editing software will allow you to export to MP3. Programs include ...
When creating MP3 file you can experiment with the following settings ...
Experiment but here are a few suggestions ...
Previews = 96kbps, 32kHz, 12bit, mono, variable bit rate on/medium quality
Standard quality = 128kbps, 44.1kHz, 16bit, stereo, variable bit rate on/medium quality. Most internet MP3 file are encoded with these settings
High quality = 192 - 224kbps, 44.1kHz, 16bit, stereo, variable bit rate on/high quality

iTunes MP3 encoder settings.
if you choose the AAC encoder in iTunes it chooses settings automatically for you. Try it out. If anyone knows more about this codec and alternative ways to encode files with it, please drop us an email.
None at present