This article is from the Ambisonic Surround Sound FAQ, by Martin Leese with numerous contributions by others.
Ambisonics cannot contribute to the DTS Digital Surround encoding or
decoding processes; it can make contributions before the 5.1 discrete
channels are encoded and after they are decoded.
DTS Digital Surround is a method of compressing and encoding 5.1
discrete audio channels to make them suitable for transmission using
CD, Laserdisc, DAT or DVD. More details are available on the DTS
Digital Surround Web page.
The 5.1 channels have complete separation but, sadly, this is not
sufficient for realistic surround sound reproduction. Channel
separation only permits sounds to be reproduced from the direction of
a speaker. To reproduce sounds from between speakers requires a mixing
style, and the most popular stereo mixing style, pair-wise mixing,
simply does not work in surround sound.
DTS Digital Surround was originally designed to enhance the enjoyment
of motion pictures. The limitations of pair-wise mixing are not a
serious impediment to this, however, they do make pair-wise mixed DTS
Digital Surround unsuitable for music.
One solution is for sound engineers to use a mixing style other than
pair-wise mixing to mix the 5.1 discrete channels. Happily, an
alternative exists - Ambisonics.
Another poorer solution is for the 5.1 pair-wise mixed channels to be
converted into W, X, Y and additional signals, and to then use
Ambisonic technology to reproduce the sound field. This is described
in the Gerzon 1992b reference.
Pair-wise mixed DTS Digital Surround is only impressive; Ambisonics is
accurate and can be impressive or subtle as required.
 
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