Ten years after the launch of CDs, Sony announced a new music medium. In the 1990s, the production volume of audio compact cassettes was rapidly declining from its peak of 76 million units in 1988. Seeing this trend, Ohga, then president, felt the need to replace compact cassettes. In the 1980s, Ohga had led the establishment of the CD business, and CD technology had quickly replaced analog audio technology thanks to its digitally-based, high speed random access and direct search capabilities. CDs were a great success, but they were originally a read-only media, and Ohga wanted to make something that was rewritable, a kind of disc that would replace the audio compact cassette.|
When Tsurushima's team from the Audio Development Group exhibited a prototype of a recordable CD at the 1989 Audio Fair, Ohga stopped and paid close attention. Just after the development of the CD in the early 1980s, Sony began development of a recordable discs. The objective was to give magnetic tape the same function as discs. The result of Sony's efforts was the launch of the Write-Once (WO) optical disk in 1986 and a Magneto-Optical (MO) disk two years later. The prototype of the recordable CD that Ohga saw at the fair had actually been produced in 1987. It was based on the same recording technology used in the MO disk, which was originally developed together with KDD (Kokusai Denshin Denwa).
Demonstrations of the CD were made worldwide using the not-yet perfected prototype. In New York, at a joint press demonstration with Philips, one of the engineers out of view from the journalists, was busy doing his utmost to prevent the system from overheating by cooling it with a Japanese paper fan.
Though impressed, Ohga said to Tsurushima, You should develop a recording and playback device that uses a disc smaller than the CD to replace the audio compact cassette. This led to the development of a new music medium.
Software and media standardization would be required in addition to hardware standardization. But Philips, Sony's partner in the development of the CD, was the original creator of the audio compact cassette. Philips had its own idea about what medium should replace the compact cassette, believing it should be a digital cassette. Sony and Philips held countless discussions, but consensus was never reached. It seemed inevitable that two new competing media would be developed.
Engineers Tadao Yoshida and Kazuhiko Fujiie, who had participated in the launch of the CD, were once again brought together under Tsurushima. Basing their work on Sony's established MO technology, the team began work on creating a compact audio recording device that used discs. It was decided that the new disc size would be 64 mm and that it would have a recording capacity of up to seventy-four minutes, the same as a CD, on an area one-quarter the size of a CD. With the cooperation of the Sony Information Systems Research Center, this led to the development of the ATRAC (Adaptive Transform Acoustic Coding) digital signal processing technology for audio compression. To ensure that the final product would be portable, technology to reduce track skipping when jostled was simultaneously developed with a new shockproof memory based on semiconductors.
In May 1991, all development was concluded, and the MiniDisc (MD), the new audio standard, was announced. To enhance portability, the disc was housed in a shell. The MD combined recordable features of the cassette tape with the random access functions and high quality sound of the CD. Sony clearly explained the difference between the CD and MD; the CD was for leisure listening and the MD for enjoying music anywhere and anytime, much like the Walkman.