Audio Quantization
Telephone applications frequently use 8-bit quantization. That is, values of the analogue waveform are rounded to the closest of 256 distinct voltage values represented by an 8-bit binary number. This crude quantization introduces substantial quantization noise into the signal, but the result is still more than adequate to represent human speech.
By comparison, compact discs use a 16-bit digital representation, allowing 65,536 distinct voltage levels. This is far better than telephone quantization, but CD audio representing low signal levels would still sound noticeably 'granular' because of the quantizing noise. However, sometimes an addition of a small amount of noise is added to the signal before digitization. This deliberately added noise is known as dither. Adding dither eliminates this granularity, and gives very low distortion, but at the expense of a small increase in noise level. Measured using ITU-R 468 noise weighting, this is about 66dB below alignment level, or 84dB below FS (full scale) digital, which is somewhat lower than the microphone noise level on most recordings, and hence of no consequence (see Programme levels for more on this).
Read more about this topic: Quantization (sound Processing)