HDCD stands for High Definition Compatible Digital not, as it would first appear, High Definition CD. If you have a middling to substantial collection of CDs (or lossless rips) the odds of you having one are quite high. If one of your CDs bears the logo, then good news. First of all, it means that the analog to digital converter employed in creating the digital signal on your CD is either the Pacific Microsystems Model One or Model Two, reputed to be some of the best converters ever made. From that standpoint, HDCD is a mark of quality.
Second, it means that on your disc or lossless file there may be features which have remained hidden. The most notable of these features is Peak Extension: a way of increasing the dynamic range of the recording by making the bulk of it quieter, increasing the bit depth (so that there is more room for different gradations of loudness), and then reversing the compression of some of the music's peaks.
More after the jump.
