What headphones do I need to take advantage of lossless audio?

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2[H]4U
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So, I've put .flac and .mp3 side-by-side and probably to no surprise to any audiophiles here, I did not notice a difference with my "gaming" headset (Turtle Beach, XBox360 junk).

If I want to take advantage of lossless audio formats, what is the bare minimum hardware I need? As far as my soundcard goes, it's on-board Realtek HD Audio (something-800 or 8888).

Do I have to break the bank?
 
I have a pair of Sennheiser HD-580 and I can't tell the difference between lossless and well-encoded MP3.

I think there was a DBT done with a Sennheiser Orpheus headphone system (north of $10K) and participants couldn't reliably distinguish between 256Kb/sec MP3 and redbook audio.

In any case, I would only use lossless for archiving purposes. Lossy audio can deliver transparent quality at a small fraction of the size.
 
With my grado sr80i, there is a massive difference between mp3 and flac, that was 80 bucks, and sr60i will also show a large diff, u can get them for 50-60 bucks.
 
Your source also plays a part in the quality. There will be a difference between an IPod's built in hardware and a good sound card or DAC.
 
The lowest it took for me to tell the difference was Sennheiser's HD 650 through an outboard DAC out of a receiver amp. The headphone is a beast and requires a lot of power to sound as clear as it possibly can. The HD 580 and HD 600 use the same exact OEM driver as the HD 650 but with different doping/tuning, thus they might be capable of similar resolution at lower prices.

The difference is also noticeable through my JH13 Pros, mostly in terms of treble response and sound imaging/spacing.

Note that I had to listen REALLY HARD (i.e. with my eyes closed in a quiet room focused completely on the sound) to be able to tell the difference. It was not enjoyable.

I think it's a lot easier to tell the difference between lossless and lossy on a decent pair of speakers. The size of the sound compresses and the treble response is more vague with lossy files.

My lossy files are 192kbps MP3s. My lossless files are FLAC. Bitrate matters for lossy files, as does the encoding algorithm. I find 192kbps MP3s to be mostly transparent and sound like the lossless counterparts unless I am placing excessively close attention (and thus not enjoying myself). 128kbps MP3 vs. lossless should be much easier to tell.
 
Its very hard for me to distinguish between flac and .mp3 @ 320kbps.
Edit: Using Sennheiser HD595's
 
The ability to distinguish lossy psychoacoustically-compressed music and lossless has less to do with your equipment than it does your ability to identify particular, specific attributes of lossy compression. The most common is pre-echo, which causes a sort of transient smearing. To this end, ear training is what is going to give you the capability to discern lossy from lossless.

There are people who can consistently discern 320kbps "archive-quality" LAME MP3 from lossless with fairly low-end headphone setups. Then there are people like myself who have difficulty ABXing LAME V5 (~130kbps) from lossless on fairly high-end setups (HD650, dedicated amp, X-Fi Prelude). The key difference is training.

You'll need a baseline level of quality in your playback equipment, but that's really variable. There is no "if you buy these headphones you'll hear a difference". You may never notice the difference no matter how elaborate your headphone rig gets.

The key advantage of lossless versus lossy is not its quality but its versatility, so you're probably already taking advantage of your lossless audio.
 
You also have to keep in mind the recording and mixing quality of the albums will determine whether there is enough material to surface in an MP3 vs FLAC comparison. You're not going to notice difference in encoding with electronica or pop songs or songs recorded by home studios.

Most recordings and at most times, I can't tell the difference between MP3 and FLAC, but there are a few songs where I can. For example, I downloaded a 24-bit/96khz FLAC album of Misfits by The Kinks from HDTracks. I transcoded to LAME MP3 V2. I then tested myself to see if I could hear a difference. I could only hear a difference in bass response, but two things:

1) The difference was VERY subtle. I had my sister play the tracks back-to-back in AB blind test for me.
2) I don't have a high-end setup. It's more mid-range. I consider high-end to be like... AKG K1000, Beta 22 amplifier, and a Monarch DAC. I have AKG K701, Heed CanAmp, and a Outlaw Audio 990 (or Adcom GDA-700)
 
Alai, your setup is definitely on the high end of midrange.
 
+1 to what phide said

basically I look at it, that people who will keep pushing ABXing and all of that to "trash" on lossy encoding have basically trained themselves to notice the difference, just like a good photographer sees light and color in terms of ASA speed and depth in terms of aperture rating, its a trained skill, not something you're "born with" (enough of this "audiophiles are the supreme being" nonsense), although some people do have a knack for it

personally I can't tell the difference between lossy and lossless with any setup I've tried, ranging from my own personal headphones to stuff thats guranteed a seat at the "high end" table, it isn't a distinction I listen for (because personally I realy don't care), the qualifier to this is that I will easily notice 32-96kbps garbage (some stuff can actually deal with 96kbps, and not sound artifacted, this is rare though), but imo thats like noticing a proper medium format still thats been digitally enlarged the wrong way (Basically you get color banding, pixelation, and so on)
 
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