As stated, you must use a digital audio connection whenever possible, as it will provide the best audio quality. The question is when you should use HDMI and when you should use SPDIF.
As we mentioned before, if you are connecting two audio equipments, most likely you will have to use SPDIF, as probably the audio source won’t have an HDMI connector. For example, when connecting a professional-grade CD player or a MiniDisc deck to an amplifier (“receiver”) or a professional-grade mixer that supports SPDIF. If one or both equipment(s) don’t have an SPDIF connector, then digital audio connection won’t be possible, and you will end up having to connect them using a regular analog connection, via a pair of RCA cables. Also, as we will discuss later, there are two kinds of consumer-level SPDIF connectors: coaxial (RCA) and optical (Toslink). Obviously, the two equipments you are trying to connect must use the same connector type. If you have a professional CD player that only has a coaxial SPDIF output, and your audio receiver has only an optical SPDIF input, you won’t be able to connect the two using SPDIF.
The same applies if your equipment has both HDMI and SPDIF outputs, but you want only to connect audio, not video. For example, you want to connect a PC to your home theater setup to listen to music or play games, but you don’t want the image to be sent to the TV. In this case, you are most likely to use the SPDIF connection.
If you are willing to connect an equipment that also produces video (DVD player, Blu-Ray player, video game console, computer, TV set-top box – a.k.a. cable/satellite TV decoder, etc.), then you will have to study the situation, because you will have a few different options.
Let’s assume that you are trying to connect equipment to your home theater setup, which is the most common situation.
In your home theater setup, you have two main components, the TV set and the audio receiver (amplifier). For obvious reasons, you want the video signal to go to the TV and the audio signal to go to the audio receiver.
If you only have a TV (i.e., you don’t have a home theater receiver with a bunch of loudspeakers around), your best connection will be the HDMI, if supported by your TV and the equipment you want to connect to your TV, of course. Simply connect one end of an HDMI cable to the device you want to connect to your TV and the other end to an empty HDMI input on the TV. This way you will have both digital audio and video, the best possible scenario. We illustrate this scenario in Figure 1.
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Figure 1: Connecting your audio/video source to a TV set using HDMI
In this case, if you have more than one audio/video source, you will have to connect each one of them to a different HDMI input on the TV. Suppose your TV has three separate HDMI inputs. You will be able to connect your cable/satellite TV to one input, your Blu-Ray player to another input, and your video game console to the third input. If you want to connect a fourth audio/video source (e.g., a computer) in this case, you will need to remove one of the other devices, as your TV has only three HDMI inputs.
If your audio/video source or TV doesn’t have an HDMI connector, you will need two sets of cable, one to connect the video to the TV, using the best video connection available (see our Video Connectors tutorial for a more detailed discussion), and an SPDIF cable connecting the audio/video source to your audio receiver (or to your TV, if you don’t have an audio receiver). See Figure 2.
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Figure 2: Connecting your audio/video source without using HDMI