The first cassette tape was produced in 1958 by RCA Victor. It was 5” x 7”, however it never gained popularity. The cassette tape was invented for a number of reasons. The biggest reason was that it offered an easier, more compact way then the reel-to-reel tapes that had been used up until the 1960’s.
The actual product of the Compact Cassette arrived in 1964 by Phillips (under the Norelco name). Between 1964 and 1966 over 250,000 recorders were sold in the US. By 1968, over 2.4 million players were sold. 
“The Compact Cassette is a plastic case containing a spool of 3.81 mm magnetic tape spooled between two reels. The tape is run at a rate of 4.76 cm/second. A tape head in the tape player or deck, in contact with an exposed portion of the tape, interprets an analog signal from the tape’s magnetic surface.
The Compact Cassette is essentially a self-contained reel-to-reel system using a narrow strip of tape and enclosing both reels within the plastic housing. When it first came into market, the storage capacity and sound quality of audio encoded on cassette tapes was quite poor due to its small size, but developments in analog encoding resulted in great improvements over the life of the technology.” 
 The History of the Cassette Tape , Dennis Hartman, http://www.ehow.com/about_5071119_history-cassette-tape.html (accessed March 28, 2011)