When: 1981
Where: Germany, Holland and Japan
Why: The storage of data on optical media revolutionised the music and software industries
How: The connection of an optical disc to a player through light
Who: Invented by James Russell, later produced by Sony and Philips
Fact: Over 200 billion CDs were sold in the 25 years after they were launched
Compact discs (CDs) helped to usher in the digital age of the music industry, and for the last part of the 20th century were the medium of choice for the record-buying public. The invention of the CD and the associated technology changed the music industry for ever, as well as many other sectors, including some which are not closely tied to media. CD technology lent itself to DVD and to CD-ROM, and thus moved into offices and homes for uses other than music and entertainment.
Even though music lovers might now prefer an MP3 to a CD, digital lasers and CD technology are still a part of our lives and are generating revenue directly or indirectly for many types of businesses. The creation of the CD was one of the great business ideas of the age and its legacy continues to this day.
James Russell was a renowned inventor and scientist working at Battelle Memorial Institute (BMI) in its new Pacific Northwest Laboratory in Richland, Washington State, when he began the initial research that led to the invention of the CD. It was 1965 and Russell, a music lover himself, was determined to find a better way of playing music than vinyl records. He was frustrated at the way vinyl was prone to scratching and warping, as well as dust interference. Russell yearned for a clearer and more definite sound recording and believed others shared this desire.
One Saturday afternoon he sketched out a system where no contact between the recording and the player would be made … he thought a light or laser beam could be used.
Russell conducted numerous experiments and soon concluded that the main problem was the scratch made by the stylus needle on the record. He tried all sorts of things to make the sound better, including different types of needle, but all his solutions reached a dead end and the essential problem remained: physical contact between the needle and the media, no matter how slight, would always lead to problems.
One Saturday afternoon he sketched out a system where no contact between the recording and the player would be made. He thought that a light or laser beam could be used to transmit information from the disc to the player. He was aware that digital data recording was already in existence, used in punch cards and magnetic tapes. His reasoning was that binary zeroes and ones could be replaced with dark and light. The information simply needed to be condensed in order to work in the new format. Over the next few years Russell toiled away, and eventually he created the world’s first digital-to-optical recording and playback system, which he patented in 1970.
To Russell’s mind this was ground-breaking research and the potential was enormous. He saw that this technology was not just confined to music but could also be used to store and play all kinds of data. He saw the commercial potential of his invention and hoped that a manufacturer would take it forward. However, although his invention did excite some interest from magazines and periodical publishers at the time, he found no commercial backers willing to take it on. Undeterred, Russell continued to work on and refine his ideas and built up a large collection of patents for CD technology. He also created prototypes and built up a body of work that was to have a major impact on the optical and digital revolutions that would be unleashed later in the century. Meanwhile, he continued to send out information to technology manufacturers about CDs in the hope they would be interested. His prototypes were viewed by many interested parties at the time, although take-up was still slow. Russell was a man ahead of his time, though thankfully, for him, not too far ahead.
Like many inventors, he was not alone in his pursuit of new sound-recording techniques and digital data. At Philips two engineers, KlassCompaan and Pete Kramer, had created a glass disc that could be read by a laser beam – to some this was in fact the very first CD.
Eli S. Jacobs, a New York-based venture capitalist heard about Russell’s inventions and was convinced of their value. He bought the licensing rights from BMI and established a company, the Digital Recording Corporation, to further enhance the product and to find commercial backers. However, Jacobs was not just interested in music but also in video, and his backing led to the creation of a 20-minute video disc in 1973. Jacobs thought CDs could be used for playing films – and he was right, but also a little ahead of his time.
Large electronic manufacturers such as Philips and Sony were now starting to realise the potential of digital recording and playback and set to work on establishing the rights and the technology that would enable them to do this. In 1978, Sony publicly demonstrated a working optical disc with a playing time of over two hours. Shortly after, Philips also demonstrated its technology and the two companies worked together to create the first commercially available CDs.
The companies understood that CDs were going to be highly disruptive to the music market. However, their merits had to be sold to the public. They also faced the problem of adoption, with expensive players necessary for the use of the new format. It would be very costly and risky for either company to go it alone; they understood that if they both brought out similar but separate products, then this would cause confusion among the public and undermine their cause. The two companies would have to work together to launch the products and move the public towards a new form of music playing. Although joint technology ventures such as this are now fairly common, in the late 1970s such an approach to business was rare and the collaboration was something of a leap of faith.
In 1980, the two companies created a ‘red book’ of standards and definitions which set out how CDs would be made. Then, one year later, at a plant in Germany the first test CDs under the agreed standards were made, and the preparations to go to market were complete. Sony released Billy Joel’s 52nd Street on CD and it was sold alongside CD players to entice customers to try the new format. It also embarked upon a memorable advertising campaign, with the slogan ‘Perfect Sound Forever’ – a reference to the deterioration in fidelity that vinyl records suffer over time.
The very first album to be recorded for the CD was Visitors by Abba, and by 1983 many other musicians were following in their tracks and releasing their albums digitally. There was much media attention surrounding CDs. This helped to create further excitement among the public and soon CDs and players were being bought by the public in their droves. In 1985, Dire Straits’ Brothers in Arms album sold over a million CDs, and by this point it was clear that CDs were going to be a tremendous success.
The format soon proved its utility beyond that of being a superior alternative to analogue sound recording, driving another revolution in business with the development of the CD-ROM.
In the years to come more and more music would be released on CD, and soon it was believed that the death of vinyl was inevitable. Record companies began to focus on CDs in the same way they had once focused on vinyl and cassettes, most of them completing migration to the format by around the mid-1990s. By the early 2000s, vinyl records were a rarity and the dominance of the CD in the music world was firmly established.
But the format soon proved its utility beyond that of being a superior alternative to analogue sound recording, driving another revolution in business with the development of the CD-ROM (Read-Only Memory).
The optical technology used in a CD is digital, meaning that the storage of any kind of data is possible. In 1985 Sony and Philips collaborated once again to create ‘Yellow Book’, a universal standard used for the storage and retrieval of any kind of data on a CD. When CD-ROM drives for computers became affordable by consumers in the early 1990s, the CD transformed computing. The format could store thousands of times more data than could the existing technology (floppy disks and tapes), meaning that large-scale storage of multimedia such as video became viable for the first time.
The CD-ROM soon rendered other formats obsolete for the distribution of software and other data on PCs; an example of the effect the format had on the computing world is in the changing nature of PC games, which began to incorporate high-fidelity music and live-action cutscenes (often gratuitously at first) into the experience, made possible by the increased storage capacity of the CD. Dedicated games consoles began to use the formats, starting with the Sony Playstation in 1995, and soon optical discs were standard in the computing world, relegating older formats to the realm of memory.
By the 1990s the world’s major electronics manufacturers were involved in the production of CDs, CD players and CD drives. Now the interest turned to what could be achieved visually as well as aurally. A joint venture of technology firms including Apple, Dell and Sun Microsystems brought forward the standards and definitions of DVD technology. In doing so they were fulfilling what Eli S. Jacobs had foreseen some 20 years before.
CDs as a storage medium for data has now been largely supplanted by newer formats such as DVDs and flash drives, which offer increased capacity, but their influence should not be forgotten; 200 billion CDs have been sold worldwide in the 30 years since Sony and Philips finalised the standard in Germany, and emerging optical technologies such as Blu-Ray owe their entire existence to the small silver disc.
The music CD is also rapidly falling out of favour with consumers. The development of digital music formats, beginning with the MP3, saw instant delivery of music become a reality. Many people are no longer inclined to visit their local record store to buy physical media, preferring the ease and convenience of online MP3 marketplaces such as iTunes; indeed digital has all but killed the singles market, with downloads accounting for over 99% of total sales. Physical album sales remain the traditional domain of the CD, with 2011 figures putting its share at 82.2%, but this is a figure that is in steady decline, with sales falling by 12.9% between 2008 and 2009.
Although CDs have proved to be but a stepping-stone in the unending quest for smaller and more efficient delivery of content, they can take the credit for having turned the music industry on its head.
These falling sales are of little concern to the record companies, who in any case have embraced the rise of digital, as it saves vast amounts of money on the cost of production. The implications for the record shop business, however, are grave; one only needs to look at the demise of former high street fixtures Woolworths and Our Price to know that times are hard for the industry. Although vinyl is making a modest resurgence, with sales of the once-moribund format rising by 55% in the first half of 2011, CDs have been left out of this upswing, perhaps still too new a technology to be seen as collectable and too old to be seen as useful.
Although CDs have proved to be but a stepping-stone in the unending quest for smaller and more efficient delivery of content, they can take the credit for having turned the music industry on its head, as well as being the first of many optical media formats to follow.