Interconnects???

 Analogue carries a signal that's a direct version of the sound waveform - in simple terms, for example, a louder sound means a stronger signal.

Digital samples the signal to create a representation in the forms of thousands of on/off pulses, which are converted back into analogue before being sent to the speakers. 

Analogue requires one cable per channel, or at least one pair of conductors in a multiconductor cable, such a a headphone cable. Digital, however, can carry two, six, eight or in fact however many channels you want down a single pair of conductors, or over a fibre optic connection. The channels are combined into a single digital datastream, then decoded out again at the other end of the cable. 

So for a standard system of separates do you use analogue or digital or either?

Stereo system - CD player/amp/speakers - analogue

Home cinema system - DVD player/receiver/speakers - usually digital from DVD to receiver, and analogue to speakers, but AV receivers also have analogue inputs to allow other sources to be connected. 

I think I follow that.

 So for my stereo I just stick to analogue connects.

 Cheers Brian