The truth lies in the fact that the CD was invented by Phillips, a Dutch company. At that time, the Dutch used the Gilder as their currency, and was subdivided into Cents (or something similar). And a ten (or was it twenty, or even twenty five) cent coin fits perfectly into the hole - well, actually, the hole fits perfectly round the coin.

So the hole is for all these wealthy Phillips executives to carry their money in!

epn