Greetings. I'm the author of the article, guides, and the first of the two Youtube videos that the topic starter posted. I found this forum when I was looking at my website stats. I'm very interested in this topic so I thought I'd come and join the discussion and respond to some of the comments.
Indeed, Dolby Headphone does use head-related transfer functions but I would argue that the accuracy of its sound localization is analogous to a two dimensional plane. Consider the following:
3D is perceiving left-right, front-behind, and above-below.
2D is perceiving left-right, and front-behind.
1D is perceiving just left-right.
A surround sound system (eg: 7.1 or 5.1) has speakers placed around the listener at head height but there are no speakers above or below. This means that these popular surround sound systems actually provide 2D audio because sounds can only be localized on a flat plane at head height.
Dolby Headphone takes a 7.1 or 5.1 channel audio stream as its input and converts it to a 2 channel audio stream for headphones. Therefore, you won't be able to hear the difference between a sound coming from above or below with Dolby Headphone. That's why I consider it 2D.
Without the use of Dolby Headphone, most games effectively provide 1D audio for headphones because they don't implement the psychoacoustic cues that provide the sensation of front-behind and above-below.
I disagree that sound localization is reliant on environment reverberations. "Spacial awareness" is different from 'sound localization'. Providing the player with an awareness of the proportions and shape of the environment is the purview of reverberation effects. It would be nice to have more sophisticated reverberation calculations but that's not really relevant to the subject of 'sound localization'.
The use of HRTFs is all that is needed to provide a more accurate sensation of a specific sound's direction.
Also, the implementation of HRTFs is well within the boundaries of what can be achieved on current computer hardware. This has been proven by excellent implementations like Rapture3D and OpenAL Soft.
Hehe, I really like this analogy.
Rapture3D provides 6 different HRTF modes. These are provided so that you can choose the one that sounds best to you.
That video was the first of several demo videos that I created. At that time, I chose the 'Green' mode but subsequently decided that I preferred the 'Red' mode. Perhaps you should listen to some of my other videos and see if any of them sound better to you.
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(Examples with both 'Green' and 'Red' mode. Music clips and sound effects are used.)
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(Only 'Red' mode is used. Demo in S.T.A.L.K.E.R.)
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(Only 'Red' mode is used. Demo in Minecraft.)
I've recently discovered that Youtube may have a very subtle degrading effect on the quality and accuracy of the HRTF, so just be aware of that possibility.