Understanding RAW Format
I’ll start by explaining where RAW format comes from.
All digital cameras take their original image in some kind of RAW format. RAW files are usually proprietary to the camera manufacturer and sometimes to the specific model of camera. That means, only the camera that takes the picture can understand the information collected on the camera sensors. That information is then translated by means of firmware (software) built into the camera and the usual result is a more user friendly format called JPEG. That is why most cameras produce images with an .jpg extension. JPEG is a compressed format (and has the ability of varying degrees of compression). JPEG has become a fairly universal digital standard for photo images.
What happens is that all digital cameras use firmware to apply various qualities to the RAW format before it is written to the memory card in JPEG form. The firmware in the camera will apply varying degrees of sharpening, varying degrees of saturation, varying degrees of contrast, etc. Most cameras have facilities to change these settings to the photographers liking. The only hint you have of what that photo will look like is the small LCD on your camera. This is usually too small to tell enough to make changes until it is too late. Often the photographer doesn’t want to mess with those changes on the field anyway. So you set your camera based on the last experience. Many people never experiment with changing these settings anyway….. Full Article.