It can be done...and I'm pleased to say it can be done with MP3 files too.
Back in 2005, some clever guys at id3.org developed the chapter addendum for ID3v2.3.
See:
http://www.id3.org/id3v2-chapters-1.0What this means is that for the first time, chapter points or reference markers can be embedded to any MP3 file, along with a separate image for each chapter, URL, description and more.
The downside is, there still (even after all this time) aren't really many players out there capable of supporting the format (yet).
You can download a tool from
here, and create your own enhanced MP3s, but again, if you're thinking about distributing the files, you're going to need to think about developing players and plug-ins to match.
On the plus side, when faced with an enhanced MP3, any MP3-player that can't recognise the special chapter tags will simply treat the file as it would a standard MP3 and there should be no compatibility issues. So in theory, you could go ahead and create the files and release them, safe in the knowledge that they'll be 'future-proofed' for such times as such players become standard issue.
I do have an as yet untested theory about including an apple-formatted .xml file that could be read by iTunes/iPods and some other media players, even if that could only be achieved by way of a plug-in, which would make life easier. Essentially, the player would read the .xml instead of the embedded tags and do the same job. BUt as I say, there's more work to do yet on whether this could be feasible.
Going even further back, in 2003, the Audio Publishing Association, together with the Consumer Electronics Association released a new audiobook format based on reading an attached .xml file. Called
CEA-2003-C, it was a really neat idea too--but unfortunately, it doesn't seem to have gotten the support it needed from both content producers and manufacturers, so it hasn't really taken off.
Without knowing more about your intended audience, playback platforms and distribution methods, it's hard to give you any specific advice or workaround that would suit your needs.
My team and I are working on some solutions that include the very problem you're facing, but we still have some way to go and of course, you need a solution yesterday.

If releasing the files in the m4b format isn't too much of an issue for you, then Apple's Garageband / Podcast Producer / Chapter Tool (google any of these) will do the trick. There's a lot of support and tutorials and let's face it, a hell of a lot of iPods and iTunes installations out there, so you'd still reach a fairly wide audience. If you're concerned about the non-iPod community, then you could always produce two types of download and let people decide whether they take the standard MP3(s) or go for the enhanced m4b version.
Of course, to run the software, you'd either need a Mac, or run a virtual machine on your PC and install a Mac OS on it, but it IS an option.
Off the top of my head, there are one or two other ways you could get around the problem using standard MP3s, but most involve creating and distributing a player of some kind, along with the audio files. And, it has to be said, that these will only really work for computer-based playback software, and not stand-alone hardware devices.
1) Simple browser-based player, based on a pre-programmed html page. I've done this myself before now. Create a simple html page that you include with your MP3 files, that includes hyperlinks to each of them, in the order you want. One drawback to this is that I sometimes came up against problems with file associations. Sometimes, the audio files can be launched in the user's default player, instead of via your html player, but if I remember rightly, we got around this., so it can be done.
2) There are numerous simple multi-media development tools out there that will allow you to create your own media players, without too much of a learning curve. Most even ship with some kind of ready-made mp3-player template that you can use or adapt. Trouble is, most of these are PC-based, which means you lose many of your Mac and Linux users.
3) If all else fails then, as has already been mentioned, the easiest thing to do would be to split the files up into chapters, give them alpha-numerical names (at least for the beginning of each filename) and then, to be 100% sure, include a playlist file for one-click access.
There are one or two other things you could try, but it's getting late and I have to chip. Sounds like an interesting project. I wish you luck with it. It's early days yet, so no doubt others will be along with some great advice, as usual, but in the meantime, I wish you all the best. If you get stuck, or wish to discuss how I might be able to help you privately, then shoot me a PM, anytime.
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