Yeah, I had this discussion with a friend of mine recently. He was saying how the new Apple music service integrated into the iPod and iTunes nicely, and cited the AAC format as being better than MP3 (a claim that WMA also makes). My response was that once you go up to a higher bit rate than 128, you can't tell the difference among file formats. Most comparisons among encoders or among file formats will do their tests at 128 or below, because it's only an issue at those low bit rates.

If you're hell-bent on saving the disk space, then yeah, WMA at 128 is maybe a tiny bit better than MP3 at 128. But for me, what's more important is the convenience of MP3. There are more players which support MP3, more tools to work with the file format, and much better and more varied tagging/organizing tools availble.

I'd rather encode at a higher bit rate than 128 and use the most convenient file format available. And right now, that's still MP3.