He's using a PS3. The preferred audio setting is bitstream. As with standard DVD players, using PCM audio output via optical means that everything you play will end up as PCM stereo. Using bitstream will let you get normal Dolby Digital and DTS from DVD's as well as the high-bitrate core lossy tracks (DD and DTS) from Blu-ray discs that have TrueHD and DTS-HD tracks.