I think we need to differentiate between the end users when discussing cutting edge technologies, even less than cutting edge technologies, etc.
I just heard a news report this morning that said an average of 1/3 of our population does not use the "internet". While there were several reasons, money being the biggest, it does speak to the use of technology by the majority of the population.
Regarding video the average person seeks entertainment and is satisfied with their telivision, there are still plenty of crt tv's being used as the primary viewing device...my mom, 87 years, still uses a 36" JVC that I gave her some years ago. It works fine and she loves it.
The same holds true with other video sources including cameras and the photograph. Generally they are not used as "art" but as a "memory trigger"...a birthday, etc. and usually the "errors"...eyes closed, a bit out of focus, zipper unzippered, etc. is more important for the memories of the event. Ease of use is also key for the average person that just wants to "point and shoot" grabbing the "moment" as it happens...
Regarding audio it is similar. The average person, young and old/regardless of gender, is using music, etc. as distraction and entertainment at the moment rather than critical listening and are more concerned with the portability, ease of use and content storage than the highest fidelity possible.
Most of us listen to audio, music, radio, etc., while doing something else...driving probably most common...and an mp3 format, or similar mobile use format...does the job decently. The listening environment also has so much sound interference, car/driving sounds, etc., that listening to a "lossless" track would not provide much more than a lower mp3 format. We are also doing other things, activities, driving, work, etc., that our senses are generally distracted and listening to anything is background...or probably should be lol...entertainment.
We also want to carry as much content as possible also and the mp3/others as well format makes carrying a wide variety and large amount of songs, etc. easy, convenient and satisfying making the tradeoff for less fidelity not so bad if noticed at all.
Our playback devices also play a major role. The "average" person generally only has the auto's factory cd/radio which, in general, is of very low quality. It also has small, inefficient speakers with paper cones that just adequately transmit the content to the ears. Turn up the volume and you get "noise". Same generally holds true with the "average" portable listening device. While the ipod and its' brothers and sisters are great portable devices the "ear piece" in use by the VAST majority is what the manufacturer supplies...ipods ear piece is dreadful in my opinion and I tossed mine after about 10 seconds after placing it in my ear. I actually use a $15.00 Sony "around the ear" earpiece with the left piece cut off so I can listen to a podcast...AVRant hehehe...while riding my bike and still hear traffic, etc. so "fidelity" is low on my priority list. I don't think many are using $400.00 ear pieces when compared to the overall population.
I loved Tom Andry's podcast with Austin, and have downloaded Austin's audio files to use on my home system. I was also surprised that less content was removed as the file was compressed than I thought/expected.
I listen to lossless files on my home system but in the car, at work, riding my bike, etc. I listen to mp3's generally at 128kps on my ipod nano4g and enjoy the quality...more so now after listening to that podcast lol.
I really enjoyed the podcast and love the conversation regarding "fidelity" as it pertains to what we are getting and not getting but it should not become a "tempest in a tea pot". I'm much more concerned with some young kid listening to his/her portable device cranked so loud that I can hear it as I walk by...I work in a "very loud" paper mill...in the lab thank goodness...and hearing loss is common. We all wear hearing protectors and have annual hearing tests but people I work with still don't wear hearing protectors properly and suffer some/or a lot of high frequency sound. My hearing has also suffered, but from standing at the front stage of too many Deep Purple, etc. concerts when a teen lol. I now protect my hearing but it is too late for hearing loss does not self repair...once gone it is gone.
I'd rather promote safer listening levels but as usual the young, me too then hehehe, does not listen to the wisdom of their elders...yuck I'm an elder.
I will say though that even at lower fidelity, today's audio fidelity is much better than when I was young and could be found digging in the little niche in my parent's cabinet stereo system for a rust free needle to stick in the "record player's" arm to listen to a "record" lol. Also watching the warped record travel around the platter was always fun.
We've come a long way and overall regardless of the file type our music, etc. is much much better than when I was a child...oh year I remember my grandfather's black and white tv had a "red/green/blue" piece of film of some sort "Scotch" taped over the front and he had a "color tv" LOL watching the "Cisco Kid" cound not have been better.
I love these conversations but can be long winded...sorry...and thanks.