If your media device is connected with an HDMI cable to your TV, you might not have digital sound on the S/PDIF connector.
This cinch connector is usually labeled 'Digital Audio out'.
This is the case when your media source (DVD, Blu-ray, …) is protected with HDCP (High-Bandwidth Digital Content Protection), and is due to legal requirements.
You will however still be able to enjoy digital sound and video with your TV via the use of an HDMI-cable.
In certain cases, the signal on the S/PDIF connector will transform your digital signal to a lower specified format automatically.
The sound quality of analog outputs is not restricted in any way.