Now, 22 years later, the MP3 truly is dead, according to the people who invented it.

The Fraunhofer Institute for Integrated Circuits, a division of the state-funded German research institution that bankrolled the MP3's development in the late '80s, recently announced that its "licensing program for certain MP3 related patents and software of Technicolor and Fraunhofer IIS has been terminated."

Bernhard Grill, director of that Fraunhofer division and one of the principals in the development of the MP3, told NPR over email that another audio format, AAC — or "Advanced Audio Coding," which his organization also helped create — is now the "de facto standard for music download and videos on mobile phones." He said AAC is "more efficient than MP3 and offers a lot more functionality."

As Stephen Witt illustrates throughout his excellent opening chapters in Witt's How Music Got Free, the MP3, before upending the musical world as we knew it, almost died in the research lab.

The team of engineers that invented the format was attempting to make it possible to send audio over telephone lines, which could only transmit small amounts of data. Fraunhofer — in competing for the legitimacy it needed to persuade tech companies to actually use MP3s, and so actually make money.
It was repeatedly beleaguered by clever corporate sabotage and later by piracy.

Other failures hinged on the need for the world to catch up with the technology's possibilities: Along the way, one computer engineer on the team had a patent for a music streaming service denied by the German government because it was technologically absurd at the time.

In early 1995, the format was on life support, with one licensing deal being the use of the technology by hockey arenas across the U.S. (That spring meeting in which the MP3 was declared dead came months later, after another failed pitch that denied it being standardized and widely adopted.)
A little later, Fraunhofer began giving away the software that consumers needed to turn compact discs into MP3s at home. The rest is recent history.
And it's not just that more efficient and complete ways of storing music have been developed. There was a deeper problem.

The engineers who developed the MP3 were working with incomplete information about how our brains process sonic information, and so the MP3 itself was working on false assumptions about how holistically we hear.
As psychoacoustic research has evolved, so has the technology that we use to listen. New audio formats and products, with richer information, are arriving.

So is it the end of an era? We may still use MP3s, but AAC is indeed much better — it's the default setting for iTunes now — and other formats are even better than it, though they also take up mountains of space on our hard drives.