Mike: 20-bit is how Microsoft (like Pacific Microsonics, which developed it) hypes it, and credulous audio writers who know nothing about a product except what a manufacturer tells them parrot the line.
HDCD is just a 16-bit system which uses the 16th bit a little differently. The rough idea is that occasionally it uses only 15 bits for the music so that it can use the 16th for decoding instructions. (There's more going on than this, including better digital filters, but this is the aspect that's relevant to bit resolution.) Microsoft would like you to believe that this decoding gives you the funtional equivalent of 20 bits of resolution. It's probably no better or worse on that score than other approaches to noise shaping.
If HDCD were truly a 20-bit system two things would be true:
1) HDCDs would not play at all on non-HDCD decks.
2) The S/N ration of HDCD decks would be above 100 dB. Ever seen a test report that found this?
HDCD is just a 16-bit system which uses the 16th bit a little differently. The rough idea is that occasionally it uses only 15 bits for the music so that it can use the 16th for decoding instructions. (There's more going on than this, including better digital filters, but this is the aspect that's relevant to bit resolution.) Microsoft would like you to believe that this decoding gives you the funtional equivalent of 20 bits of resolution. It's probably no better or worse on that score than other approaches to noise shaping.
If HDCD were truly a 20-bit system two things would be true:
1) HDCDs would not play at all on non-HDCD decks.
2) The S/N ration of HDCD decks would be above 100 dB. Ever seen a test report that found this?