Recapping means replacing some or all of the electrolytic capacitors in a unit. Electrolytic capacitors are prevalent in almost all audio gear, and while they are effective and relatively inexpensive, they do tend to fail with age, whether the unit is used or not. Constant usage (provided excessively high temperatures are not involved) does tend to make electrolytics last longer, but once a unit reaches about 40 years of age, it's time to seriously consider replacing all of its electrolytic caps. In units over 40 years old, especially tube units, where high internal temperatures are the norm, it becomes even more important to replace these aging capacitors.
First you must have some idea what capacitors are, and what they do in an audio circuit. A capacitor is simply two conductors separated by an insulator. A capacitor exhibits a property called reactance, which is resistance to the flow of alternating current (AC). The reactance of a capacitor is inversely proportional to the frequency of the AC, and it also inversely proportional to the value, or "capacity" of the capacitor, measured in farads or more commonly, microfarads. Capacitors store electrical energy within themselves in the form of an electrostatic field. Storing and releasing this energy is how they create reactance. A capacitor tends to show less resistance to the flow of high frequencies than to low frequencies, and ideally a capacitor will not allow direct current (DC) to flow at all, although all capacitors allow a tiny amount of DC to flow due to an undesirable property called leakage. Better capacitors show so little leakage current that it is often unmeasurable.
Electrolytic capacitors use two conductors sandwiched together, separated by an insulator that is nothing more than a layer of oxidation on one of the conductors. This extremely thin oxide allows electrolytics to be very much smaller than most other capacitors for a given capacity and voltage rating. Most electrolytics use aluminum foil for the conductors. Another type of electrolytic capacitor uses tantalum, and these caps tend to be very expensive, but also much smaller and more stable than aluminum electrolytics. Aluminum electrolytics do have higher leakage current than other forms of capacitor, but good ones have small enough leakage currents that it is not a problem.
In an audio circuit, capacitors are used for many things. They can be used to create frequency-dependent filters, such as tone controls, or the RIAA deemphasis filter in a phono preamp. They can be used to eliminate DC flow from one audio stage to another, while letting audio (which is always AC) flow freely. And they can be used to store DC and release it when needed. This is the function of a "filter capacitor," used in power supplies to smooth the pulsing DC that comes from the rectifiers and turn it into constant DC with no "hum." Power supply filter capacitors also provide the audio circuits with a low source impedance, which is important for stability.
When electrolytic capacitors age, their capacity can change (usually downward), and their leakage goes up. Often, especially in the case of filter capacitors which are constantly exposed to the full power of the power supply circuit, the leakage can cause the capacitor to get warm in use, and heat just makes matters worse. Eventually, a capacitor may become so hot from its own leakage current that it bursts. But even before then, the changes can affect sound quality dramatically, and in the case of coupling capacitors in units that use single-ended power supplies, the failure of these capacitors can cause damage to surrounding circuitry or even damage your speakers, in the case of power amp output coupling caps.
Do I need those expensive caps I read about?
It is important to use good quality electrolytics when replacing the caps in audio gear, but it is not necessary to use "golden ear" brands that are prohibitively expensive. These caps, while quite good, will not gain an audible improvement over other good quality caps. Most of the time, I use Nichicon Fine Gold capacitors, except in the case of filter capacitors, which are often not available as Fine Gold caps in the size needed. However, any good quality brand of capacitor should be fine, so long as one stays away from cheap Chinese caps. Remember that these vintage pieces gained their well-deserved reputations for high-quality sound despite being built with garden-variety Japanese capacitors.
What about "upgrading" certain caps?
It was common in the 60's and 70's for manufacturers of good audio gear to use electrolytics even for very small values of capacitance, under one microfarad. They did this because at the time, such caps were cheaper than film caps of equivalent values. However, film caps tend to be much more linear than electrolytics, more precise in their values, and they work better in places where there is no DC bias than do electrolytics. So, whenever I replace electrolytics smaller than one microfarad, I use film caps instead, usually (but not always) Wima film caps.
As far as upgrading by using larger value caps than the originals, one must be careful when doing this. You never want to change the values of capacitors used in audio filters, as doing this will change the response of the filter. Power supply filter caps can be replaced with larger ones within reason, and this will result in slightly better performance at high power levels. But one must not go too far in replacing these caps with bigger ones because doing so also increases the peak currents flowing through the power transformer and rectifiers, and this can lead to failure of those components. (The failure of a power transformer is often the death knell for a piece of vintage audio gear, because the transformers are very hard to find short of buying another intact unit.) I rarely increase the value of filter caps beyond a factor of two. Sometimes in smaller amps I will use a factor of three, but no more. I do often use higher voltage caps when possible, as they will last longer than using a cap that is constantly exposed to nearly its maximum voltage rating.
The output capacitors in amps with single-ended power supplies keep DC out of the speakers, but let music through. The value of these caps is important. The larger they are, the better the amplifier output transistors will couple to the speakers at low frequencies. Most amps use 1,000 microfarads, and this is good enough, although I will sometimes go to 2,200 microfarads, especially if the amp is used with 4-ohm speakers. Going beyond this can create loud turn-on thumps when the amp is powered up, because these amps usually have no protection circuits to eliminate them.
What about recapping speakers?
Loudspeakers usually have crossovers within them. A crossover is a filter that separates the audio into ranges appropriate for the various drivers within the speaker system. Bass goes to the woofer, mids to the midrange, highs to the tweeter, etc. Such crossovers almost always use capacitors, and most often they use a form of electrolytic capacitor called a "bipolar" capacitor. This is an electrolytic cap with oxide on both foil conductors, not just one. A normal electrolytic cap must be used with DC on it or it becomes very non-linear to audio. Bipolar electrolytics do not require any DC bias, although they are still less linear than film caps because the reverse-biased oxide layer acts like a rectifier. Replacing the bipolar electrolytics in speakers makes sense as they approach 20 or more years of age, as these caps degrade like all other electrolytics. Changing to film caps may provide a slight improvement in sound quality, especially at low levels, although good film caps of the sizes and voltages used in loudspeakers can be rather expensive.
What about the other caps?
Other types of caps fail, too, but the ones used in most solid-state audio gear are far more long-lived than their electrolytic cousins. However, especially in tube gear, there can be non-electrolytic caps, especially wax-and-paper caps and so-called "bumblebee caps," that should be replaced due to poor reliability or even obvious damage. Also, there are certain caps in certain brands of gear (such as the Rifa and Frako caps prevalent in Revox and Studer tape decks) that are known to fail with dramatic results. These should always be replaced on sight, even if they're still good. If I see that your unit needs such work, I'll tell you when we discuss the estimate for repairing your unit.