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The term "bandwidth" in the context of AV systems primarily refers to the range of frequencies that a system can transmit or receive. Bandwidth is crucial because it determines how much audio or video data can be transferred over a given medium or connection within a certain timeframe. Higher bandwidth generally allows for the transmission of higher-quality audio and video signals, as it can accommodate more data. This principle is essential in various applications, such as streaming high-definition video or managing multiple audio channels during a live event, where sufficient bandwidth ensures clear, uninterrupted performance.

The other concepts mentioned do not directly relate to the characteristic of bandwidth. Power supply pertains to the electrical capabilities of the equipment, physical size relates to the dimensions and form factor of components, and the distance signals can travel without degradation involves signal integrity over long runs rather than frequency range. Each of these parameters is important in its own right, but bandwidth specifically addresses the frequency response and data capacity of the AV system.