The RAW format file is a binary file that contains all the information recorded by your sensor when you took the shot. As a binary file, it will be read by a RAW engine such as Adobe Camera RAW (used by Adobe Lightroom and Photoshop) but never modified… When one edit an image that was recorded in RAW format, the develop settings aka metadata need to be stored somewhere. Since the RAW file cannot be modified, the post-production tools create a sidecar file (which share the same filename) with the XMP extension. XMP stands for Extensive Metadata Platform and is a standard. If one shoots in JPEG or TIFF, those format file can be edited therefore there is an XMP section in the file where metadata is directly stored, and no external XMP file is then generated. Note in Adobe Lightroom; there is a catalog used to store everything about the images (location but also develop settings and history). The whole point of XMP is when one relies on multiple post-production tools. Let’s say one edits images in Adobe Lightroom but wants to open that edited file in Photoshop afterwards. If one does not have the XMP file, then Photoshop would not know about the changes one has previously made. Note that when using JPEG of Tiff, the XMP is stored inside those files. Hence a single edited jpeg file can be open afterwards in the post-production tools, and the initial changes will be taken into consideration.
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