Increasing demands on production accuracy entails the need to reduce servo errors. This is directly related to the need to take into account the motion differential characteristics, which requires the use of special more accurate measuring systems. Quadrature optical encoders are widely used in industrial CNC equipment. Replacing them with sine-cosine encoders may lead to the need for partial or complete replacement of drives, motors, and CNC systems. In this regard, it is important to evaluate the capabilities of different types of encoders and the feasibility of replacing them. This paper discusses the advantages and disadvantages of various types of encoders. The capabilities and limitations of quadrature encoders are analyzed. A comparison is made of the theoretical resolution of sine-cosine and quadrature encoders. The results of experimental studies are shown, confirming the possibility of obtaining differential characteristics with the required accuracy using quadrature encoders.