There are differing types of analog based sound technologies with each having their advantages and disadvantages. First, let's narrow them down to the basic two and explain the various implementation of each.
Optical
The optical format uses light to store the sound information, much like a grove works for a vinyl record (you do remember those?).
Believe it or not, the optical format was the highest in fidelity in the earlier years of film. In fact, the masters recorded for the movie "Fantasia" from Walt Disney studios were recorded on an optical film. The fidelity and signal to noise characteristics of optical formats are completely dependant on the resolution of the film, the width and focus of the recording and pickup device, and most importantly, the quality of the electronics designed to amplify it.
Despite it being the oldest format, it is still one of the most popular. All movies produced today still have an optical analog soundtrack. In fact, there are sound processing technologies that give optical sound high fidelity, meaning excellent frequency response and high dynamic range. In fact, the quality of today's optical formats exceeds the quality of earlier magnetic formats!
The reason why optical formats have survived for so long is the simple fact that it's cheap and easy to encode on the film itself. The process of duplicating film copies both the sound and picture information at the same time as the film doesn't care what's on it. No extra expensive processes are necessary. Since movies are made for profit, it's always well liked by movie makers.
Optical formats originally started as a monaural format meaning it's designed for only one channel and to come out of only one speaker for reproduction. Due to film not being very high in quality and being relatively grainy, the reproduction suffered. They were often muffled and hissy when played. So, the industry wanted to find a way to improve the sound quality. What they found they could do was boost the high frequencies when recording to the film and then decrease those frequencies when playing back. This had the effect of removing the hiss and improving the high end response of the playback. What was also discovered was that if brightened the light shining through the film at playback and at the same time make it travel through an extremely thin slit, and being focused on the film precisely resulted in much improved frequency response. They also found that the smaller the grain in the film not only improved the picture quality, but also the sound quality. It lowered undesired noise and hiss even more. At the this point the fidelity was better than that of all other analog formats in recording electronics (not just cinema).
With the exception of "Fantasia", all early movies were mono (Walt Disney was ahead of his time by nearly 40 years with 6 channel sound!). Just like in the music industry, someone felt that the movie experience would be better in stereo. So they divided the single band of optical track into two tracks as shown in the above graphic. Now the movie can be in stereo, and many were throughout the late sixties and seventies. Would you believe the movie "Jaws" was monaural, when it could have been in stereo?!
Soon, a scientist named "Dolby" started his own laboratory and turned it into a business selling licenses for new technologies his lab invented. One famous and still used invention is "Dolby Noise Reduction". This technology changed the way sound was recorded on optical film (plus other analog formats) and how it was played back. While the way mono soundtracks were recorded and played back was a good idea, it did not take into consideration the characteristics of the human ear and the physical characteristics of optical film and its noise table, and also the nature of electrical waveforms and how to manipulate them. The Dolby method found that if you could control which frequencies got boosted and how much they got boosted on the fly during playback, they could dramatically reduce playback noise, dramatically increase dynamic range and frequency response. They also found out that at the same time they could use the characteristics of electrical waveforms and actually encode a two more channels, for a total of four, onto just two sound channels. These extra two channels were a center channel and a rear channel. The three front channels (left, center, right) were high fidelity channels, however, the rear or "surround" channel had the fidelity only slightly better than an AM radio's. However, that's all that was needed to creat the effect of being surrounded and pulled into a movie.
The Dolby method made Dolby labs an instant success and gave new vigor and excitement to movies, which at the time were competing with television. Now movies had the advantages of being able bring a viewer into the experience by surrounding them with sound made the experience much more dramatic. The dramatic difference between a movie with Dolby and a movie without was demonstrated in 1977 by the release Star Wars. The movie's success was partly attributed to the success of it being able to pull the audience into the experience, of course George Lucas had much more to do with the movie's success, but Dolby helped. Soon all movies were encoded with "Dolby A" noise reduction, which had the advantage of being able to be played back on non-Dolby equipment without a noticeable harshness in sound quality. However, you needed a Dolby decoder to get the advantages of Dolby reproduction and surround sound. This allowed theaters time to catch up and studios the ability to instantly provide "Dolby Surround" sound films.
"Dolby A" type format is still used today. A much scaled down version was moved to the consumer music market called "Dolby B" and the better "Dolby C". However, "Dolby A" is the more advanced of the three.
Later, Dolby came out with an even better format called "Dolby SR" or "Spectral Recording". This format improved the noise reduction benefits of Dolby throughout the entire sound spectrum and not just the high frequencies. It also improved the frequency response further and made advances in sub-frequencies reproduction. Extremely low frequency reproduction where producers wanted to allow listeners to feel and not only hear the movie made Dolby SR very popular. If you have the movie "Raider of the Lost Ark", listen to Indiana Jones' gun and his punch. Without sub-woofers and good sub-frequency reproduction, those things would not have the incredible physical punch they have when played through a sound system designed for it. Indy's gun goes "BOOM" and not just "bang", and his punch you can almost feel yourself. Most movies now days have either "Dolby A" or "Dolby SR" for their analog formats.
Magnetic
When optical formats were still relatively young and magnetic technology far exceeded optical technology, some studios produced films, mainly their high budget ones, using magnetic formats. Magnetic had the advantage of extremely high fidelity and extremely low noise, in fact recording studios were using it for years. It could also hold more channels of sound in a much smaller area than optical. However, it was an expensive process to coat film with magnetic oxide and then to record onto it. While magnetic had some uses in 35mm film, it was used mainly for 70mm film due to its space, and the reasoning was if you're going to pay for magnetic, then you might as well pay for 70mm, and visa versa.
Magnetic, in most part, has been a multi-channel format, usually six or seven channels (Front Far Left, Front Left of Center, Front Center, Front Right of Center, Front Far Right, Rear Left, and Rear Right). 70mm movies were in a wide picture format and thus the screen's area needed to be covered by more speakers and channels.
Magnetic suffered from fidelity and signal to noise problems much like optical formats, although not as severe. However, the reproduction characteristics of magnetic media introduced more unique issues into reproduction. Issues such as bias and pre-emphasis all had dramatic effects on how the magnetic media performed over all. Mis-adjustments could severely affect quality. Consumers even today even know this with cassette media. A misaligned and magnetized head can severely affect the quality of playback. This results in heavier maintenance of the playback equipment. Back in the late seventies and early eighties, the quality difference was worth the trouble.
Magnetic was also blessed with "Dolby A" type noise reduction with greatly increased the already high quality playback. A movie in magnetic format has as good or better sound quality than the recordings of studio master magnetic machines, especially with Dolby encoding! Magnetic formats were eventually replaced by digital formats and the optical "Dolby SR" format.