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It sounds like you know more about this stuff than I do - I’ve spent hours searching online but it’s hard to find good info.

Why are mics like the SM7b better than mics like the MV7 or elgato one that just work over usb? I don’t understand how they actually work or why all the extra equipment (audio interface, gain booster, cables) is worth it - what’s the tradeoff being made when you use USB?

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All mics sound different. Whether or not the mic includes a USB interface doesn't inherently make things worse. It just happens to be that the best sounding mics rarely come with an integrated USB interface. No need to use the best if you're happy with something else.

It's like asking what makes a VM better for a website when I could just use a SaaS site builder. Use whatever works; depending on your goals you might end up with the exact same finished product.

The SM7B is just trendy because a lot of famous podcasters use one. For just recording dialog, or doing video calls something simpler would be just fine.

Getting super high end with microphones is only really applicable in the music industry IMO.

Fun fact: Michael Jackson recorded the vocals for Thriller on an SM7B.

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