Quantization Error
For the ?-law codec, the error must be evaluated statistically. For a full range sinusoid, the theoretical quantization error (noise floor) is about 39.5 dB. Real world codecs are about 35 dB. By Shannon’s theorem, the maximum data rate is:
bps = 3000 log2 (1 + 10 35/10)
If quantization error can be eliminated, data rates can be increased.