A system for generating parametric stereo data from phase modulated stereo data is provided. A phase difference system receives left channel data and right channel data and determines a phase difference between the left channel data and the right channel data. A phase difference weighting system receives the phase difference data and generates weighting data to adjust left channel amplitude data and right channel amplitude data based on the phase difference data. A magnitude modification system adjusts the left channel amplitude data and the right channel amplitude data using the weighting data to eliminate phase data in the left channel data and the right channel data.