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A wiring method using three individual wires for a single audio signal. One wire is a ground/drain/shield wire, another carries a positive audio signal, the third carries a negative audio signal. The two audio signal wires carry the same (equal) signal, but the signals are opposite polarity of each other. At the terminating end, the two signals are inversely combined (one of the signals is inverted and then the two signals are summed). Why do this? Electromagnetic interference is induced equally on both wires--this would normally result in a noisy audio signal. Since one of the signals is opposite polarity (and is reversed when the two are summed together), the interference now cancels out because if two signals are equal but opposite in polarity, they will cancel when summed together. Balanced lines are used for microphone and line level signals.

Source: Church Audio & Acoustics Glossary

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