source is still king
During the 70s, the source component of any hi-fi system was cited as the most important aspect of any system - and for good reason. The quality of a turntable was, and still is, governed by how well it is engineered. Since the dawn of the digital era, and particularly over the past few decades, this source guideline has largely been forgotten, as digital is seen to be 'as good as it gets'. The difference between digital sources may not be as big as it is between analogue sources due to the physical variables of turntables, but the old adage still holds true – source is still King.
hierarchy
Regardless of how good your amplifier and speakers are, their ultimate capabilities are going to be limited by the quality of the source you use, and this includes software as well (records, CDs, digital files). Your system can only sound as good as its weakest link, and the best audio system in the world can’t reproduce what isn’t there or improve on a low quality source and the signal it produces.
improve your source
If your hi-fi system relies upon compressed audio files or low bit rate streaming services, you are not off to a good start. But all is not lost, as you can still make the most of compressed music and sub CD quality streaming services with a good quality Digital to Analogue Convertor. In fact, the difference a good quality DAC can make can be far more noticeable with lower quality music than with high quality, well recorded music. So next time you book an audition, bring along a few CDs that you think don’t sound very good. You might be surprised...
improve your software
Don’t settle for MP3 downloads and low quality streaming services. Give your system a good source foundation to start from - if it's not there in the first place, nothing else in the system will make up for it, regardless of price. FLAC, WAV, high resolution downloads, CDs, and records will all provide high quality music. High bit rate streaming services like Qobuz and TIDAL (particularly with their MQA Masters albums) will also provide a good base to work from. You’ll end up with a far better sounding system because of it, regardless of how much your system cost. And you'll be all the happier for it.
davidf @ the little audio company