SPDIF (and AC3) are the (now legacy) ways that home theater systems are supposed to use to transfer high end surround sound to the receiver for amplification and distribution to individual speakers.
Many audio cards on the market can transport AC3 (aka Dolby Digital) or DTS compressed audio data over a digital cable (SPDIF). They can also transport 16-bit stereo PCM (uncompressed) to SPDIF.
Boomer can't decode or encode, or transcode, any compressed audio at the moment. While it might be nice if we could do this, there are significant and non-trivial hurdles to making that happen. Some are technical (such as computational costs and lack of hardware offload), and others are more legal (such as trademark, licensing, and patent considerations.)
So, Boomer could transport uncompressed 16-bit stereo over SPDIF. (That's all SPDIF has bandwidth for!) Which we support today in audiohd. And in the future we might extend this to other devices.
However some operating systems also support a pass-thru for compressed audio data, where data is taken from a source (such as a DVD application) and routed directly to the receiver without any changes. This works reasonably well, except that it adds a lot of complexity to make it work right, and you completely lose any control over gains or the ability to mix other audio sounds with the stream. (Want to get a notification of an incoming VoIP call while you are watching your movie? Too bad... you can't do that with AC3 passthru.) This mode is of such limited use that we're inclined not to support it at all -- its really only useful for media center PCs used in conjunction with home theater systems to watch DVDs. (And we already know about the various problems with watching commercial DVDs right? I won't talk about those legal problems here.)
The best feature for SPDIF is the ability to transfer 6 streams of data in a single cable -- using a lossy compression. The reduction in cables to tie this into your home theater system is really a good thing. But of course, we don't have an encoder, so we can't do that except in the pass-thru case we already said we weren't going to do. (So no 5.1 gaming via SPDIF for you... Dolby calls this Dolby Digital and all audio cards that support it do so in software only, which requires expensive licenses from Dolby.)
Fortunately, there are better options on the horizon, and this is where we want to spend our time.
One option is ADAT ("lightpipe") -- which can support 8 channels of uncompressed audio at 48 kHz. Its available on some motherboards even now. Supporting it would probably be fairly easy, although using ADAT might require some very high end audio equipment (ADAT is used in professional audio situations.)
A second, and far more accessible option, is the use of HDMI's audio channel. New motherboards (and some cards, such as the Asus Xonar HDAV) can support HDMI audio. HDMI supports 8 channels of uncompressed audio at up to 192 kHz. This is plenty for even the most demanding audiophile. And if you want more channels, you can always use a second HDMI cable! HDMI offers us the best audio capabilities without any compromises. (We can use it with mixing, volume controls, or use it in a bit-perfect fashion. We get full quality. And we don't have to deal with any of the licensing, technical, or legal headaches that accompany trying to get a real-time AC3 or DTS encoder working. ) So at this point, any investment spent in AC3 instead of HDMI on our part just looks kind of silly.
I expect that sometime later this year (or more likely next year), we will be looking hard at getting HDMI audio working with Boomer. (Note that I have no control over funding or project priorities -- so this is just a prediction, not a promise.)