Key difference: MPEG stands for the Moving Picture Experts Group. It is a working group of experts that was formed in 1988 by ISO and IEC. The aim of MPEG was to set standards for audio and video compression and transmission. MP3 is short for MPEG-1 Audio Layer 3.  It is a patented encoding format for digital audio.

MPEG stands for the Moving Picture Experts Group. It is a working group of experts that was formed in 1988 by ISO and IEC. It was a joint initiative between Hiroshi Yasuda of the Nippon Telegraph and Telephone and Leonardo Chiariglione. Chiariglione has served as the group’s Chair since the group’s inception.

The aim of MPEG was to set standards for audio and video compression and transmission. By 2005, the group has grown to include approximately 350 members per meeting from various industries, universities, and research institutions.

The standards as set by MPEG consist of different Parts. Each part covers a certain aspect of the whole specification. MPEG has standardized the following compression formats and ancillary standards:

• MPEG-1 (1993): Coding of moving pictures and associated audio for digital storage media at up to about 1.5 Mbit/s (ISO/IEC 11172). It includes the popular MPEG-1 Audio Layer III (MP3) audio compression format.
• MPEG-2 (1995): Generic coding of moving pictures and associated audio information (ISO/IEC 13818).
• MPEG-3: MPEG-3 dealt with standardizing scalable and multi-resolution compression and was intended for HDTV compression but was found to be redundant and was merged with MPEG-2.
• MPEG-4 (1998): Coding of audio-visual objects. It includes the MPEG-4 Part 14 (MP4).

MP3 is short for MPEG-1 Audio Layer 3.  It is a patented encoding format for digital audio. It uses a lossy compression algorithm which is designed to reduce the amount of data required to represent the audio recording while still sounding like a faithful reproduction of the original uncompressed audio.

Uncompressed audio files are rather large and take up a lot of space. This is mainly due to the fact that sound is very complex and the translation of it into a digital format can take up a lot of data. An MP3 file compresses this data using a 128 kbit/s setting that results in a file that is about 1/11 the size of the original data. The MP3 file can be created at higher or lower bit rates, with corresponding higher or lower resulting quality.

MP3 has become one of the most commonly used audio formats available and has been the standard for audio files for quite some time. Most digital audio players use the MP3 format as the default standard of digital audio compression for transfer and playback of music.

MP4, on the other hand, is based on Apple’s MOV file type. MPEG-4 Part 12 was developed from the Apple’s MOV file and eventually resulted in MPEG-4 Part 14, which is the MP4 format. The MP4 is a container format. This means that it can be used to store audio and/or video data. MP4 video and audio can also be streamed over the internet. 

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