As programs and data files got much larger, more capacious media were needed to hold them. For a while, major software vendors were selling boxed software that had 20 floppy diskettes for installation, with the programs and data on those diskettes in compressed format! Soon, computer designers realized that CD-ROMs which were used for music could also hold data.

CD-ROM stands for Compact Disk, Read Only Memory. It is an inflexible plastic platter, with only one active surface, that stores data very much like a disk drive. A typical CD-ROM stores about 650 MB, which is over 400 hundred times as much as a single floppy diskette.

Data is not stored in magentic form on a CD-ROM but in an optical fashion. Bits are written into the platter by burning tiny holes or pits into the surface so that later a laser, bouncing light off the plastic's surface, can sense when there is a hole or not by measuring the reflectivity of the surface. The presence or absence of a hole corresponds to a bit. A hole means "1" and no hole means "0."