A method is provided for encoding multiple microphone signals into a composite source-separable audio (SSA) signal, conducive for transmission over a voice network. The embodiments enable the processing of source separation of the target voice signal from its ambient sound to be performed at any point in the voice communication network, including the internet cloud. A multiplicity of processing is possible over the SSA signal, based on the intended voice application. The level of processing is adapted with the availability of the processing power at the chosen processing node in the network in one embodiment. An apparatus for separating out the target source voice from its ambient sound is also provided. The apparatus includes a directed source separation (DSS) unit, which processes the two virtual microphone signals in the SSA representation, to generate a new SSA signal including the enhanced target voice and the enhanced ambient noise.