I went straight to Sonar 2.0 myself and never used the earlier versions so I don't know much about the differences. But I do know that some DirectX plug-ins won't work with Sonar versions prior to 2.0. I am currently using the Antares Pitch-Correction and the BBS Maximizer plug-ins, which work nicely. Sonar 2.0 reportedly has better Rewire implementation for Reason users like myself. Also the new Yamaha OPT panels only work with Sonar 2.0. I'm sure there's more differences between the versions, but overall Sonar seems to be the one audio/midi program that is really worth the effort to own and use so I would do the upgrade. I purposely did not go with the XL version because I have Sound Forge, which has great mastering features that appear better than what the XL version of Sonar offers.