Optical Storage

an Asus external optical drive

Optical storage is a term referring to the storage of data on an optically readable medium. Data is recorded by making marks in a pattern that can be read back with the aid of light, usually a beam of laser light precisely focused on a spinning disc.
http://en.wikipedia.org/wiki/Optical_storage

This devices do not make direct contact with the disc and the are called optical drives because they use lenses.
Now compact discs are getting obsolete in my opinion because we got dvd's and Blu-ray discs which have a lot more capacity and are just about the same size.Also Blu-ray discs have a scratch resistant layer that prevent those awful scratches that will damage your infomation.

The main difference between an optical storage device and a hard drive is that hdd capacities are way far from actual optical drives and that they do not use magnetism to store information. Instead they use a laser that read or burns pits and lands on a disk.