HTPC Blu-Ray essentials
Page 6: HDMI audio transport
6.1 why is this needed?
In the "good old times" the graphics card was responsible for the video stuff while there was a separate audio card/chip for the audio stuff. But HDMI puts the whole concept into question. Suddenly there's one cable which transports both video and audio!
Now there are 3 possibilities how to solve this dilemma: Either the sound card must be able to chain the video signals through. Or the video card must be able to chain the audio signals through. Or there must be a combined card handling both video and audio.
6.2 which audio formats does HDMI support?
Blu-Ray contains a lot of new audio codecs which can not be transported through SPDIF, anymore. Let me mention multichannel PCM, TrueHD, DTS-HD and E-AC3. All these can be transported as bitstream over HDMI. However, only the latest HDMI version 1.3 supports all that. Nevertheless older HDMI versions can also be sufficiant, because even the oldest HDMI implementation is already capable to transport uncompressed multi channel audio.
6.3 current solutions
ATI/AMD's latest graphics cards have an onboard audio chip, which allows the same audio formats which also SPDIF allows. Sadly, none of the new formats introduced with Blu-Ray are supported.
NVidia's latest graphics cards allow to pass an SPDIF signal through coming from a sound card. But again this is limited to the old SPDIF supported audio formats.
Some Intel G35 mainboards have HDMI 1.1 ports which allow everything that SPDIF supports, plus uncompressed multichannel audio. This is the best solution today for HDMI audio transport. Unfortunately G35 has its own share of problems.
There are some audio cards announced (Asus, Auzen) with HDMI ports. But
they're not really on the market right now, AFAIK.