Most people carry more than 1 GB of music in their laptops. Most of the music is encoded in the old MP3 format. Old? Yes... more than 15 years old. The MP3 format project started in 1998, can you believe it? Run a search on Google if you don't. MP3 format started as a project from a German man to encode the CD's audio in a way that they could transport 100 musics instead of only 10. Of course the algorithm has evolved a lot since then. Still MP3 is a very low quality standard only used because of the popularity. What are the alternatives? Too many but this guide will only focus on the most important ones.
WMA
Windows joined the audio quality race and launched it's very own audio format. In the beginning it was even worse. When the version 8 came along the quality boosted to a level much more superior than MP3 ever could. The way the files are coded allow WMA to achieve much better results than MP3 even can. WMA is about 50% with the same bit rate. If you choose the VBR option then you can have music you can't hear the difference between CD and WMA with just 192 KB/s. If you don't believe try yourself. This happens thanks to the technology called VBR. It will use just the bits it needs to make the quality good. If there is no music at a determined second it will use 0 KB's in that second. If one second of music has a lot of instruments then the VBR will use 320 KB's making the file small and top quality. Interesting isn't it? MP3 VBR technology doesn't work so well by the way.
OGG
This one has very good quality at low bit rates such as 64, 92 and 128, sometimes even better than WMA but the lack of compatibility and popularity makes this format a not very good option for you.... Forget it
RA
Real Audio used to be a very good format. Now it's worse than WMA so forget it.
MP4
Now we're talking. The best for last. This new format is up to 5x times better than MP3 and up to 3x times better than WMA. There are too many MP4 formats because some codecs use one technology and other codecs use another technology. The best one so far is NERO Digital audio. Who could guess that a CD burner software was the best audio encoder in the world? Too bad they changed the way they encoded it. The very best quality was around NERO 6 when they allowed high bit rates using High Complexity encoders. After that with Version 7 you only use Low Complexity with high bit rates. Still it's a very good codec for low and high bit rates. The only problem is you will have to buy Nero and I tell you it's not cheap.
A cheaper, or better free solution is Winamp. It can RIP music from CD's to MP4 format with a quality almost as good as NERO. Too bad you can't encode files that were already Ripped and encoded.
To ensure you have 100% music quality rip it with EAC software than encode it with NERO Digital to MP4 format High Efficiency codec. Nothing is better so far!