Abbreviation for Digidesign Audio Engine. DAE is the underlying code that Digidesign has been using to make their audio systems work and communicate with computer hardware and software. When you launch Pro Tools (or any application that uses DAE to communicate with Digidesign hardware) DAE also launches in the background. The main application (such as Pro Tools) is really just acting as the user interface while DAE is actually taking care of the underlying mechanics of moving the audio data in, out, and through the system. DAE is required for software programs to be able to access Digidesign hardware.
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