MP3, otherwise known as MPEG Audio Layer 3, is simple method of shrinking, or compressing, music files, so that they occupy far less space on storage media, such as hard disks. MP3 not only reduces file size, but also keeps the audio quality very close to that of the original recording. An uncompressed audio file has a transfer rate 1.4 Mb of data per second, while an MP3 only uses 4 Kb to 40 Kb per second, allowing larger storage capacities for music, and much faster file transfer rates. The encoded bit rate should be a minimum of 128 Kbps for high quality audio. The higher the bit rate, the clearer the sound reproduced.

The memory capacity of an MP3 player is important, how much so is largely dependent on how the player will be used. The Bush PMP512N is a flash memory player with a 512 Mb capacity, capable of storing hundreds of tracks. The Philips PSA615 is a hard drive model, which can store thousands of tracks. Some models, such as the Oregon MP130 orange MP3 player, come with SD and MMC memory cards for additional memory.

Most MP3 players display song titles and artist information about a song, called ID3 tags. Some advanced models have a backlit, LCD screen for increased visibility in low light. The Sony NWS706FV is a model with a back-lit LCD display and the Ministry of Sound MOSMP056X comes with an LCD screen and ID3 tagging. Most new players use a USB connection for transferring data at high speed, while USB 2.0 and FireWire interfaces are used for ultra-speed downloads. The MPMAN AV99 is a 1Gb black MP3 player with a USB connection. Some players, including the Cowon iAudio G3, are 1Gb players featuring a USB 2.0 interface.

Besides playing MP3 files, MP3 players also support other formats. The common audio file formats include AAC, AIFF, ASF, WAV, and WMA. If you want to play video, then you will need support for other formats, such as Motion JPEG, DivX, MPEG1, MPEG2, and MPEG4. The Sumvision M18 is a 512 MB player that supports MP1, MP2, MP3, WMA, WMV, ASF, and WAV.

Firmware refers to the software that is built into the player. Upgradeable firmware increases the usability and extends the life of the player. The MPio FG100 is a 256 MB player that comes with upgradeable firmware. Most MP3 players perform more than the basic function of playing MP3 music. Some players, such as the iRiver iFP-190TC 256 MB player, feature voice recording and an FM tuner with recording capability. The Philips PSS110 256 MB model has an additional alarm function.

MP3 players are incredibly small and versatile, with various functions and innovative features. The players come in many different forms, fitting all kinds of tastes and lifestyles. There are important things to consider before buying one, such as memory storage capacity, portability, accessibility, and battery life. Think about how, when and where you want to use your player, before you take the plunge and buy one.