The number RMS value we come into contact with everyday is the 120 volts a.c. from the outlets in our homes and offices (in the U.S.A.). That is 120 volts RMS. The peak voltage from a wall outlet is 170 volts. Voltage, Wattage and Current can basically be described in terms of peak, RMS or average output.
There are various ways to describe WATTAGE, which in this case describes how much power (in watts) a speaker can handle.
RMS equals approximately 61.4% of the PEAK Power handling capacity of your speaker. If you multiply the RMS WATTAGE by the number 1.414 you will now know the PEAK WATTAGE that the speaker can withstand.
All this "PEAK", "RMS" and "AVERAGE" talk should have been worked out years ago. As with most things "industry standards" for devices made by many different companies are a big afterthought. For years early on manufacturers would advertise standards without using the same procedures to determine their findings but that is not the reasone for 3 different descriptions. Moreover, this is the reason why the numbers are not always reliable. Still, the specifications today are LIGHT YEARS ahead of what they were 20 years ago and among reliable manufacturers should be trusted. Most amplifiers are rated in terms of PEAK power. Most speakers are rated by RMS power handling capacity.
I'll make you a little scale. Peak WATTS x 0.714 = WATTS (RMS). These are popular amplifier ratings in the peak side of the scale.
PEAK = RMS
25 = 17.9
50 = 35.7
100 = 71.4
150 = 107.1
200 = 142.8
250 = 178.5
300 = 214.2
Watts describes ability to handle power. You need to match you speakers to your amplifier(s). If you have a 100 watt(peak) per channel amplifier then you want 75 watt (RMS) per speaker pair, speakers or better. That is pretty simple, right?
This is not a telling factor of how "good" your speakers will sound. The frequency response (flatness) and sensitivity (efficiency) of your speakers are possibly more important than sheer power alone unless you are just interested in shoving 6, 10 inch woofers in your Honda and mega-blasting the rest of us.
Frequency response - 20hz to 20khz, a "flat" response curve indicates that the speakers add few artifacts to the signal coming from the amplifier(s). That is a good thing
Power (watts) - The ability of an amplifier to produce or a speaker to handle power. This number means different things to different people. Most of the world would be satisfied with a 250 watt system. This would be comprobable to a good factory system in a brand new car with some emphasis on audio reproduction quality. Sounds good and satisfying even on the freeway.
The teenager down the street wants 18 inch woofers and 2 Zeus amplifiers powering each of them for a bone jarring 2,000 watt system.
Sensitivity - High end, expensive speakers have a more favorable characteristic for this specification. This is a speaker's ability to efficiently used the power supplied by the amplifier. Which is to say a highly sensitive speaker will be as loud at 25 watts as the crappo bounder box speaker is at 60 watts. Not too difficult to understand. It works like gas mileage sort of.
Hope this helps.