Yes, I know, some of you out there are still using CDs, however this media format has been around since the mid-1970s if you can believe it; that’s retro as far as I’m concerned.
Small note before continuing: If you use anything that still uses CDs and not DVDs, I strongly suggest picking up a quality brand 100-pack of CD-R discs. In the possible near future, you may discover your local department or electronics store doesn’t sell them anymore. For the specific occasions when you actually need one, such as making a music CD for a car with a CD player that doesn’t have an audio port for your MP3 player, if you don’t buy your CD-Rs now, you may not be able to sooner than you think.
Why were CDs such a big deal for PCs?
Space, space, space!
In the early 1990s, the average hard drive for a brand new computer held between 200 and 250MB. Yes, MB. Not GB. While true the over-1GB hard drives existed (Seagate introduced their 2.1GB Barracuda ST12550 to market in 1992), almost nobody could afford them. Also bear in mind the vast majority of IBM PC Compatible users were using an MS-DOS/Windows 3.1 setup; many of those computers couldn’t ‘see’ hard drives over 1GB without the use of special software such as Maxtor’s "MaxBLAST".
The point here is that when people were presented with the option of writing a full 640MB (later bumped to 700MB) on a single disc, that was literally the equivalent of three hard drives for most users, and that’s why it was such a big deal.
A new era of PC gaming
Game developers jumped on the CD-ROM bandwagon faster than anyone else. Given the fact they had so much room to work with (compare under 2MB of a floppy to over 600MB of a CD), they couldn’t wait to start using them, and use them they did. Introduced into the fold were full prerecorded soundtracks, full motion video and a whole truckload of game enhancements.
In the DOS arena specifically, CD made for some of the best PC games ever produced – many of which have yet to be topped even now in 2011.
A much more reliable way of storing data
3.5-inch floppies were never reliable. In fact it was totally possible to write data to a floppy, pop the disk out, bring to another PC, pop it in there, and the disk failed – even if the disk was brand new.
CDs on the other hand had (and still do) a much better way of writing data, particularly with its error checking. When you wrote a file to floppy disk, nothing was checked to make sure the data actually got there. CD on the other hand did check and had proper opening and closing of sessions. You could get even further confirmation data was written properly with the ‘verify’ option.
Are CDs even worth having anymore?
Yes, for the following reasons:
CD-R is the only optical format guaranteed to work in all PCs and Macs…
…provided the file system includes ISO9660. If you were burning a disc using ImgBurn for example, clicking Options will bring up the file system options:

As long as you choose one with ISO9660 included, that will make the written disc "most compatible" for whatever computer you use it in.
DVD, amazingly, still has problems being read in all PCs and Macs. It’s rare that it happens, but definitely not out of the realm of possibility. CDs don’t have that problem.
Audio CDs will work in any console player
Let’s say for the moment you have a 1986 Chevrolet Camaro with a factory-installed Delco CD player in it. If you burn an audio CD from your PC and pop it in that ancient console player, guess what? It’ll work.
Granted, that’s a crazy example, but there are tons of cars and trucks out there much newer than that – even brand new ones – that don’t have an audio port for a portable MP3 player or smartphone, so you may still need CDs for that reason.
A CD is still the easiest way to physically mail data to someone
There are times when it’s actually cheaper to physically mail someone a disc rather than try to get large amounts of data to them over the internet.
Here’s an example situation:
You have 500MB of data you want to send to someone. That someone has internet that is painfully slow or uses an ISP with a very strict bandwidth cap. It will either take too long for the transfer to complete or it will simply cost the recipient too much on their ISP bill to download the file(s).
While true you could mail out a USB stick, that’s a bit of a waste considering discs are so much cheaper, and the fact the post office does has CD mailer envelopes specifically made for sending discs.
If you mail out a CD, you know it will work and won’t have to worry about compatibility issues. If you mail out a DVD, there’s a 99% chance it will work, but you may be that 1% that sends a disc that the recipient’s PC or Mac cannot read, so you’re better off sending a CD.
Some notes about mailer-friendly media
Mini CDs
The standard CD physical size is 120mm. Mini CDs are 80mm. Business card CDs, sometimes called b-cards, are even smaller at 58mm or 68mm and will easily fit in a standard envelope.
I don’t recommend getting these at all for two reasons.
First, they can only hold from 50 to 210MB of data.
Second, they require an optical drive with a tray in order to use. If sending one of these discs to someone using a slot-load type of optical drive (such as on many laptops), they won’t be able to use the disc.
For the curious, yes there is also miniDVD (pictured right); the single-sided flavor holds 1.4GB of data. Cute, but not worth the bother of using unless it’s just for you and no one else.
SD, SDHC, microSD, Micro SDHC
This is "most mail-able" type of flash memory these is. Any one of these on the cheap side is between 3 to 5 bucks, ranging in storage sizes from 1 to 4GB. Anything above 4GB will cost more than 5 bucks presently.
While easy to pop in an envelope and mail, these are nowhere near as cheap as discs are. In addition the recipient must have the appropriate card reader to get the data off of them, possibly leading to more trouble than its worth.
I would only suggest mailing a flash card if you’re 100% certain the recipient knows how to use one, and you have a few extra bucks to spend just to get the card(s). Otherwise, CDs are still your cheapest, best and most reliable option.

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I have a 2002 Cadillac that refuses to load a burned music CD … just sayin’
That’s because you’re either using cheap media or burning audio CDs at 100% write rate which your GM radio won’t understand because there are too many errors on attempt to read. Burn the disc at 2x or 1x and it will work.