The deciding happens on the speaker, the other devices would just pass the appropriate signal. The Beam, when connected via HDMI ARC, communicates back to the TV to tell it what sort of codecs it can support. The CEC controller in the TV set (when it is on) communicates that information back to any devices that need it, such as your cable box, assuming the cable box is CEC compliant and that function is on.
Not all ‘smart apps’ can send the appropriate signal, but the CEC controller on the TV should be telling the app ’this is the best, please give it’.
In a normal situation, you should be letting CEC do its thing via HDMI ARC, and not changing anything. Unless the sending device is not CEC compliant.
Thanks foe the info. I wil stidy this furher to better undestand this
Have a read into HDMI EDID.
The Cable Box will ask the TV what the TV is capable of producing sound wise during the HDMI handshake.
@GJBOb PCM means your Source device is ‘decoding’ the audio vs. using Bistream to send the DD or DD+ signal to the audio playback device to decode, all things being equal you will not hear any difference between the two options.
PCM is a requirement with Blu-ray if you want to ‘mix’ supplementary audio onto the audio which is on the disc at full bandwidth, if you chose to use Bitstream you either lose the supplementary audio or downgrade the audio to a compressed format.
Once you add a TV between a Source and the sound playback device things get a little more complex as now you have to know what the TV can pass between its HDMI Input and eARC, ARC or Optical audio Output (even where the TV is not decoding the signal it can still limit what you can pass through the TV), you can for example have a TV which Supports Atmos as DD+ from its onboard apps but only supports 2 channel PCM when passing a signal via the TV’s HDMI Input(s) from an external Source device!
For Atmos you also have devices such as ATV 4K which have an onboard Dolby MAT decoder which always outputs PCM.
As @Keithmac says EDID and E-EDID is the mechanism whereby devices communicate ‘capabilities’ to each other and for the most part setting your devices to ‘auto’ will result in you seeing and hearing the best signal the collection of devices support.
Where you want to ‘force’ a change or workaround any limitations one or more of your devices introduce into the signal path you can add in an EDID manager to try and ‘fool’ your system.
As ever with all things AV you can experiment with outputting Bitstream or PCM from your Source and see if you notice any differences/open up any additional options/introduce limitations in your downstream devices.