OK - I understand VHS to DVD (and even DVD to Blu-Ray/HD); But what is the need for upgrading mp3s?

Yes. MP3’s are very compressed. Even discernible on my stock iPod earphones.

The AAC standard is also compressed, but has higher sound quality and typically a smaller filesize.

(AAC is a multi-vendor standard. Apple uses it for the iTunes store, wrapped in the Fairplay DRM. But AAC itself ≠ Digital Rights Management. Sony, Nintendo, and many others can play AAC files. Kinda crazy to me why the Amazon MP3 store isn’t offering AAC files… perhaps they boxed themselves in with the store name?)

I’m positive @sndfreQ will have much more insightful things to say.

Oh, and you can’t upgrade your MP3s directly. That info is lost. You’d hafta re-rip your music and select a better output format.

It also depends on how much you compress your MP3’s. I can definitely hear the difference if you do that too harshly :)

Also, I don’t know exactly what you mean by “upgrade”, but a format like Ogg Vorbis is better because it can achieve the same quality with a smaller filesize. If only most media players supported it…

It’s also a matter of your equipment. Many many people using digital audio players, like the iPod or Zune, just use the standard ear buds that are packaged with the player. If this is the case for you, I wouldn’t worry about using a lossless format because the ear buds aren’t high quality enough for you to hear any difference. If you’re talking about any type of decent or high end headphones or speakers, then yes the difference between an mp3 and a lossless is readily apparent to pretty much anyone with ears.

But to answer your question- the upgrades you mentioned are advances in picture/sound quality and technical features. Since there’s no way to carry a 5.1 or 7.1 surround sound system with you, and the music that is available in stores is largely a stereo mix, there’s no real reason to upgrade. You’re really addressing the CD format, not mp3, because as long as the source of the music is a CD, the format itself doesn’t really matter all that much, they’re all stereo music files.

My hearing is not so great, but I can tell the difference between a 192Kbps ad a 320Kbps MP3. My system isn’t high-end enough to notice a difference between lossy & lossless on the whole, though.