A new MP3 technology from the Fraunhofer Institute offers support for 3D sound.

The new format is called losono. Developed by Karlheinz Brandenburg this new technology aims to reproduce realistic positional audio for everyone in a room.

In theory, Losono can support active sound elements such as horses galloping through a space, or crowds shouting from behind you.

To achieve such results the technology employs an array of small speakers - sometimes as many as 400. An algorithm works out exactly what the sound waves would be and each speaker then reproduces its own bit of audio in conjunction with the others to create the required audio-image.

Licensing for the new technology - which is being demonstrated to movie studios - costs between $10,000 and $15,000.