Balanced connections use a 3-pin design consisting of three wires: a positive signal on one pin, negative signal on another pin, and ground on the third pin of the connector. The full signal strength is received by the input by combining the positive signal with an inverted version of negative signal; inverting the negative signal also cancels noise picked up by the line. Balanced connections are common in pro audio, because they are robust and noise canceling. However, connecting a 2-pin unbalanced signal to a 3-pin balanced input doesn’t work very well, as only half of the signal is received by the balanced line.
A ground-compensated (GC) output connection also uses a 3-pin design, but the full signal is carried on one pin, with nothing on the second pin and ground on the final pin. This means that a balanced input still sees full signal strength, and because the unused negative pin still carries any noise picked up by the cable, noise is still canceled as with a true balanced connection. A ground-compensated output works well with an unbalanced input since the system delivers full signal strength on two pins, however, you do not get the noise-canceling benefits of a true balanced input/output.
Ground compensated connections were used in the 1980s on mixers and other gear designed for inputs that could accept both unbalanced and balanced signals.