I’ve seen the word ‘codec’ on various websites, what does this mean?

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I’ve seen the word ‘codec’ on various websites, what does this mean?

 

– The word ‘codec’ is a truncated form comprising the words encode and decode. – That is, there is a two-part process when creating a compressed format, the first being to encode the file into the format, and the second, having the file decoded so that you may listen to it.

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