Extensive compressor reviews and FAQ

Headroom is how much more your signal can be amplified before some component in the signal path starts to clip. Clipping is when the tips of an audio wave get chopped flat (distorted and compressed) by running through a component that can't handle the full strength of the signal. People mistakenly use the word headroom to mean "more volume" or "more power", but in reality you can have high headroom at low volume, low power; or low headroom at high volume, high power. Headroom isn't how much you've got, it's how much you've got left.
My favorite illustration is a man walking through a low doorway. The amplitude of your signal is the height of the man. The amount of space between the top of his head and the door frame is the "head room". If he's a short man, there's still plenty of room. A medium-height man can walk through, but with no room to spare. A tall man will bump his head--he has to stoop, making himself shorter, to get through. The harder he bumps his head, the louder he yells; this is hard clipping. The shorter he stoops, the more his shape changes; this is compression. Even when he bumps his head he keeps moving through the doorway, so clipping always means compression too.
Let's look at this in terms of amplifier wattage. A lot of times people think they get more headroom by buying a higher-powered amp. But if the speakers you're using can't handle the wattage, they will clip, fart out, and/or overheat. That means you ran out of headroom.
This is not directly related to the cab's ohm rating, either. For example, if you have a low-efficiency 1x10 cab rated 4 ohms, and a high-efficiency 4x10 cab rated 8 ohms, which one has more clean headroom? Even though you'd technically get more wattage from a given amp with 4 ohms (in most cases), the fact is the smaller speaker would start to fart out and sound bad far sooner than the larger, more efficient cab--so it has much less headroom. This will probably be true even if both cabs had the same wattage rating, because of the excursion demands placed on each speaker.
The input stage of the amp matters too, along with any EQ or other stages in the middle, and finally the power amp stage--they can all clip. If you send a really high-level signal into the amp, and it distorts, then you ran out of headroom. A preamp with really high headroom is not one with higher output, but one that can take higher input without clipping.
So let's say you've got it all dialed in: your speakers can take lots of power and there's no (unwanted) clipping anywhere in the chain. Getting a higher-wattage amp will (finally) mean higher headroom, more potential clean amplification, relative to where you were before. But that still doesn't necessarily mean you will get any "louder". Loudness is not so much about how much power you have, or how much headroom you have, but more about "what you do with it". Loudness is affected by compression, distortion, and EQ curves--and all three of those things may come from obvious controls like an EQ or compressor knob, but they are always inherent to the design of your specific amp and cab. When Nigel Tufnel of Spinal Tap talked about turning his amp up to 11, his idea was that he'd get "one more" of loudness; it wouldn't necessarily mean more wattage, and it probably would be distorted.
Since headroom does not mean loudness, why would somebody want more headroom? Aside from wanting to avoid audible distortion, the main reason is that big transient signal spikes are what gives our sound more of a sense of "strength" or "guts" or "heft". This is why many bassists like to have 1000-watt amps: the reality is they are probably using only a small fraction of that wattage 90% of the time, but the ability to put out a 1000-watt transient spike on their note attacks gives their whole overall sound a bigger, more percussive, and deeper-seeming presentation. Back to the word headroom though, if that bassist was actually making his amp crank out 1000 W constantly, he wouldn't have any headroom!
So when you're considering different amps and you want more volume, forget headroom and just ask for advice about how to get more volume. Sometimes the answer will be "more power", but more often it will be "more efficient use of the power you've got". And that, in turn, sometimes means removing obstacles to the power, for example by adding more speakers, thereby increasing your headroom. While other times it can mean increasing the concentration of power (with compression and EQ), thereby reducing your headroom. Low headroom is precisely why the all-tube SVT, at only 300 W, gets so incredibly loud! So headroom is a perfectly valid idea to pursue--just don't confuse it with "more loudness" or "more power".

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