It was also a direct competitor to Sony's MiniDisc (MD), but neither format toppled the then-ubiquitous analog cassette despite their technical superiority, and DCC was discontinued in October 1996.

DCC signaled the parting of ways of Philips and Sony, who had previously worked together successfully on the audio CD, CD-ROM, and CD-i.

The companies had also worked together on the Digital Audio Tape which was successful in professional environments, but was perceived as too expensive and fragile for consumers.

Philips had developed the Compact Cassette in 1963 and allowed companies to use the format royalty-free,[2] which made it hugely successful but not a significant money-maker.

For this, it cooperated with the Institute for Perception Research of the Eindhoven University of Technology to create the PASC compression algorithm based on psychoacoustics.

[5] The first DCC recorders were introduced at the CES in Chicago in May 1992[6] and at the Firato consumer electronics show in Amsterdam in September 1992.

[citation needed] At the "HCC-dagen" computer fair in Utrecht, Netherlands, between 24 and 26 November 1995, Philips presented the DCC-175 portable recorder that can be connected to an IBM-compatible PC using the "PC-link" cable.

[citation needed] Philips marketed the DCC format mostly in Europe, the United States, and Japan.

[7] DCC was quietly discontinued in October 1996[7] after Philips admitted it had failed at achieving any significant market penetration with the format, and unofficially conceded victory to Sony.

However, the MiniDisc format had not done very well either; the price of both systems had been too high for the younger market, while audiophiles rejected MD and DCC because in their opinion, the lossy compression degraded the audio quality too much.

Also, because of the time needed for the mechanism to switch direction, there is always a short interruption in the audio between the two sides of the tape.

[citation needed] Because of the low tape speed, the achievable bit rate of DCC is limited.

To compensate, DCC uses Precision Adaptive Sub-band Coding (PASC) for audio data compression.

The difference in quality between PASC and the 5:1 compression used by early versions of ATRAC in the original MiniDisc is largely a subjective matter.

In contrast, non-super user tapes may have one or more section that has no absolute time code and tracks that are unnumbered.

On the DCC-175 portable recorder it was possible to circumvent the SCMS protection by copying audio to the hard disk and then back to another tape, using the DCC Studio program.

The cases that DCCs came in generally did not have the characteristic folding mechanism used for analog compact cassettes.

The DCC-175 was sold only in the Netherlands, and was available separately or in a package with the "PC-link" data cable which can be used to connect the recorder to a parallel port of an IBM-compatible PC.

Only small quantities of both recorder and cable were made, leaving many people searching for one or both at the time of the demise of DCC.

The DCC-175 Service Manual[16] shows that in the recorder, the cable is connected to the I²S bus that carries the PASC bitstream, and it is also connected to a dedicated serial port of the microcontroller, to allow the PC to control the mechanism and to read and write auxiliary information such as track markers and track titles.

However, many users complained that they would have liked to have the possibility of using uncompressed WAV audio files with the DCC Studio program, and Philips responded by mailing a floppy disk to registered users, containing programs to convert a WAV file to PASC and vice versa.

Unfortunately this software was extremely slow (it takes several hours to compress a few minutes of PCM music in a WAV file to PASC) but it was soon discovered that the PASC files are simply MPEG-1 Audio Layer I files that use an under-documented padding feature of the MPEG standard to make all frames the same length, so then it became easy to use other MPEG decoding software to convert PASC to PCM and vice versa.

The technology of using stationary MR heads was later further developed by OnStream for use as a data storage media for computers.