XBMC announced today that the next version of the software will add HD Audio! Read on for details.

First of all, what is XBMC? Here is how they describe the project:
XBMC is an award-winning free and open source (GPL) software media player and entertainment hub for digital media. XBMC is available for Linux, OSX, and Windows. Created in 2003 by a group of like minded programmers, XBMC is a non-profit project run and developed by volunteers located around the world. More than 50 software developers have contributed to XBMC, and 100-plus translators have worked to expand its reach, making it available in more than 30 languages.
While XBMC functions very well as a standard media player application for your computer, it has been designed to be the perfect companion for your HTPC. Supporting an almost endless range of remote controls, and combined with its beautiful interface and powerful skinning engine, XBMC feels very natural to use from the couch and is the ideal solution for your home theater.
Currently XBMC can be used to play almost all popular audio and video formats around. It was designed for network playback, so you can stream your multimedia from anywhere in the house or directly from the internet using practically any protocol available. Use your media as-is: XBMC can play CDs and DVDs directly from the disk or image file, almost all popular archive formats from your hard drive, and even files inside ZIP and RAR archives. It will even scan all of your media and automatically create a personalized library complete with box covers, descriptions, and fanart. There are playlist and slideshow functions, a weather forecast feature and many audio visualizations. Once installed, your computer will become a fully functional multimedia jukebox.
It is difficult to put into words all that XBMC can do, head to the gallery to see some examples, or take the plunge and Try it Today.
If you are using XBMC and want to bitstream HD audio, this update is for you. Here is what XBMC announced today:
XBMC Audio goes HD
May 30th, 2012
It’s been long-awaited, oft-discussed and it’s finally here – AudioEngine for XBMC!
What is AudioEngine? A complete re-write of the core audio sub-system of XBMC, and a two-year project comprising some 22,000 lines of code.
Spear-headed by lead-developer gnif, with contributions from many other team developers (dddamian, gimli, fneufneu, anssi, memphiz and others!), AudioEngine brings high-definition audio to the already amazing XBMC. No matter the audio source, AE handles the decoding, resampling, transcoding, encoding and streaming of your media, including for the first time DTS-MA, TrueHD and 24-bit audio. XBMC has never sounded better!
With full floating-point audio pipes, even mp3’s sound audibly better, with dithering built-in to further reduce quantization noise.
After a herculean effort and many lost evenings, the team is happy to announce that AudioEngine has been merged with the master branch as of May 15th 2012. As such, it is now possible for the team as a whole to participate in it’s further development and for users to enjoy via the nightlies or your own builds.
Features of AE include:
– support for DTS-MA / Dolby TrueHD Bluray formats
– support for 24-bit and floating-point audio at up to 384,000hz
– mixing of all streams including GUI sounds even when passing through or transcoding audio
– start-up enumeration of hardware audio devices and their capablities with log output
– bitstreaming support in PAPlayer
– upmixing of stereo to full channel layout
– tighter syncing of A/V streams
– floating-point processing of audio
– 24-bit and floating-point decoding/handling of mp3
– full support for ReplayGain
– built-in sample-rate conversion and transcoding
Planned Features for upcoming AE releases:
– rules-based decisions for output formats based on hardware capabilites
– a range of DSP’s (digital signal processors) including headphone head-related transfer function processing, DRC (dynamic range compression), low-pass filtering for subs and an equalizer function
– custom channel-mixing/mapping for up and downmixing
It’s still early days for AE. Bugs will be found, and new and exciting features added. It’s stability and feature-set will develop as it matures and grows in the amazing open-source environment of XBMC. We’d especially like to thank all the testers who helped make it possible to bring this merge about.
If you want to give it a try just grab one of the nightly versions on one of XBMC’s mirrors. For further details and support links please visit the AudioEngine page in our Wiki where you will also find links to the support threads in our forum, if you have additional questions. From the development team, enjoy!
We’ll keep an eye on this project and let you know when HD Audio goes live with XBMC.
XBMC Blog Post