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Strategic Maneuvering and Mass-Market Dynamics: The Triumph of VHS over Beta
Published online by Cambridge University Press: 13 December 2011
Abstract
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This article deals with the diffusion and standardization rivalry between two similar but incompatible formats for home videocassette recorders (VCRs): the Betamax, introduced in 1975 by the Sony Corporation, and the VHS (Video Home System), introduced in 1976 by the Victor Company of Japan (Japan Victor or JVC). Despite being first to the home market, the Beta format fell behind the VHS in market share during 1978 and declined thereafter. By the end of the 1980s, Sony and its partners had ceased producing Beta models. This study analyzes the history of this rivalry and examines its context—a mass consumer market with a dynamic standardization process subject to “bandwagon” effects that took years to unfold and that were largely shaped by the strategic maneuvering of the VHS producers.
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- Business History Review , Volume 66 , Issue 1: High-Technology Industries , Spring 1992 , pp. 51 - 94
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- Copyright © The President and Fellows of Harvard College 1992
References
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25 Quoted in TV Digest, 16 Feb. 1976.
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29 Nihon Keizai Shimbunsha, ed., Gekitotsu, 54.
30 JVC committed to supplying Hitachi on an OEM basis although this entailed that a large portion of its production capacity of about 2,000–3,000 units per month would be diverted to that end. This portion would have been significantly smaller for Sony, which, at the time, had a production capacity of more than 7,000 units per month. See Nomura Management School, “VTR Sangyo noto”; and TV Digest, 21 April 1975 and 13 Dec. 1976.
31 Nayak and Ketteringham, Breakthroughs! 46.
32 Michael A. Cusumano interview with Susumu Gozu, Manager, Domestic Sales Dept., Video Products Division, Victor Company of Japan, July 1989.
33 Kokichi Matsuno, message to employees in taking over as JVC President in 1975, and Shizuo Takano, JVC's Video Department manager, both quoted in Nayak and Ketteringham, Breakthroughs! 41. Susumu Gozu, in his interview with Cusumano, gave a similar account of JVC's approach.
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42 Nihon Keizai Shimbunsha, ed., Gekitotsu, 21–24, 54; Lardner, Fast Forward, 159.
43 Yokomizo, “VCR Industry and Sony,” 39–40.
44 TV Digest, 4 April 1977.
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47 TV Digest, 11 July 1979.
48 Ibid., 29 Aug. 1977.
49 Ibid., 30 May, 27 June, 7 Nov. 1977.
50 Ibid., 4 April 1977.
51 Ibid., 29 Aug., 3, 31 Oct., 7 Nov. 1977.
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55 Richard S. Rosenbloom, personal interviews at RCA, 1982.
56 TV Digest, 6 Oct. 1980.
57 Ibid., 8 Dec. 1980.
58 The Wall Street Journal, 21 April 1986, 20D.
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