Perceptual coding achieves compression by discarding only subjectively inaudible information
Evidence
A psychoacoustic quantization stage which allocates bits to the various components in the audio signal in a manner that has the minimum subjective distortion. Again, in order to do this it has to send additional side information to the decoder, such as the number of bits allocated to each signal component. This is the only stage that removes information from the signal and is therefore the only lossy stage in the whole process. It is this stage that makes the difference between a lossy and a lossless audio coding system.
— David Howard, Jamie Angus, coustics and Psychoacoustics, 2582
Categorization
DEFINE: Defines the lossy-versus-lossless distinction in perceptual audio coding: exactly one stage, the psychoacoustic quantizer, is allowed to throw information away, and it is judged by subjective distortion rather than fidelity.