Remember, if you will, that magical decade known as the 1980s. Music technology is about to forever change with the introduction of the compact disc. On a plastic disc read by lasers (ooh!) and much smaller than a vinyl phonograph record (aah!), you can store digital copies of music (ooooh!) and play them back without having to move a stylus to the right track (yay!).
To encourage the masses to buy their music collections all over again, Philips and Sony had to sell their new CD technology to the entire world. Music labels were concerned that their album art would be shrunken down to the point of unreadability. Consumers were given things like DDD labels to highlight how "digital" must mean "better." Retailers were faced with a quandary: with a case only 1/4 the size of a record cover, how long will it be until hooligans start walking away with expensive inventory?
Emil Petrone was a board member for PolyGram Records, then owned by Philips, in 1982. He was part of the blitz of publicity for the CD format, and he heard the concerns of major record stores and the recording industry. His solution was the longbox.
The longbox was a cardboard or plastic case 6" by 12" (15 x 30 cm) in size, exactly twice the height of a CD jewel case or the size of an LP cover folded in half. The jewel case was mounted in the top half of the longbox, and could be removed from the longbox entirely. Record stores were able to reuse their existing LP racks to hold two rows of CDs, which made up for the fact that a jewel case is thicker than an LP jacket. Furthermore, thieves would have a much harder time slipping a longbox than a jewel case under their coat. The record industry loved the longbox because it gave them more room to put eye-catching album art.
Longboxes quickly lost their novelty after people realized they were buying a half-hollow box. Stores like Tower Records began to ask patrons if they wanted the empty half removed after they purchased a CD. Environmentalists grew angry at the excessive packaging that was often not recyclable due to the inks and materials used. Many longboxes became single-color eyesores as the record industry abandoned its plans for large album art outside the jewel case. As electronic anti-theft measures were improved, the theft deterrence advantages of the longbox disappeared. The box added about 20-40 cents to the cost of manufacturing a CD, which was passed on to the consumer. An organized movement called "Ban the Box" called for the longbox's removal as early as 1991. As the 1990s progressed, stores switched to stocking jewel cases with reusable plastic sleeves that would be removed at checkout and the longbox died a peaceful death.
Compare the longbox to the other major form factor in home entertainment: the VHS video cassette. VHS tapes were designed to be the same size as a paperback book so that they would fit in families' bookshelves. As they became popular, so did dedicated cabinets just large enough for VHS tapes. Notice how many cartridge-based video game consoles, and even a few CD-based systems (Sega CD and Sega Saturn, for example) used boxes identical in size to the VHS box even though their contents were far smaller than the VHS cassette. The sensible, near-golden ratio rectangle of a VHS box still lives on today in the slightly thinner DVD case that has gained industry-wide acceptance in the United States.
Sources:
http://www.medialinenews.com/issues/2002/october/cover1002.shtml
http://www.robertchristgau.com/xg/music/rbbox-90.php