Right Times, Wrong Tracks (Part 4)

Once upon a time, after a long and fairly cordial courtship that began way back in 1969 (Part 2), the “wedding" of Philips Electronics and MCA Universal finally arrived on December 15,1978, in Atlanta, Georgia (Part 3).

The wedding day started out a joyous affair, as lines of admirers stretched around the block, eager to be part of the historic union that brought together the sleek Philips Video LaserDisc player and the attractive Hollywood movies from MCA.
But Philips and MCA would have been better off eloping, for what had started out as a blessed event quickly evolved into a shotgun wedding that produced a very unhappy couple and a very bitter divorce.

The union of the immature MCA video laserdiscs to the unstable Philips (Magnavox) 8000 Video LaserDisc player never even had a honeymoon, as both the discs and the player had clearly been rushed to the altar, fearing a totally eclipse by the whirlwind arrival of handsome VCR.

Together the MCA discs and the Philips Laserdisc player resulted in a marriage “made in hell,” but it was the buyers of the units who suffered from lack of support. They threatened to sue—not for divorce, but for products brought to the market that were clearly not ready for public consumption.

The irreconcilable differences between MCA and Philips surfaced immediately, as both accused the other of neglect and betrayal.

MCA claimed it was Philips’ insistence on a “rigid” disc rather than a “flexible” one that was the genesis of the product failures. Philips accused MCA of shoddy manufacturing, poor quality control and an inability to produce a reliable disc that would meet the agreed-upon specifications. MCA argued the tolerances on Philips (Magnavision) players were unreasonable, while Philips suggested MCA’s refusal (or inability) to keep to the agreed-upon specifications was an act of defiance.

A very nasty marriage, to say the least!

The dysfunctional couple did, however, bear a single child from this hapless union, and her name was DiscoVision.

Although DiscoVision would never grow up to amount to very much, would have a few stepfathers and eventually be abandoned at about the age of three, sometimes the offspring of such dysfunction can ultimately grow up to lead useful and productive lives, as we will come to see.

Together MCA and Philips had agreed to love and honor one another, but there were not many legal ties binding them, other than a joint licensing agreement.

So with their relationship on the rocks, MCA—the Hollywood starlet—decided to go on the prowl for other electronics firms to, shall we say, get into bed with.

When Philips denied any interest in investigating industrial applications for the laserdisc format, the back door was left open for MCA to seduce other members of the electronics community without getting Philips jealous.

MCA, though, was in a lawsuit with Sony over the Betamax (click here), so her field was limited and she needed to get involved with a company without a VCR in the family.

Hunks like Sony, Panasonic and JVC, the major electronics companies at that time, were enjoying the good life with the hot VCR and had very little interest in MCA’s “ugly duckling” laserdisc.

Pioneer, a high-end Japanese electronics company without a VCR in its past, was very eligible and looked to be quite a catch. The handsome, maverick Pioneer was a minor player in the Japanese electronics field, known primarily as a high quality audio hardware company and very interested in getting into a video format that was an alternative to the VCR.

So the handsome Pioneer from Japan and the sexy MCA from Hollywood, California, looked quite attractive to one other.
The invitation to get involved with MCA for industrial players gave Pioneer the alternative video format opportunity it desired. It also gave MCA more support for DiscoVision, as well as someone to fall back on if the marriage with Philips become too strained or collapsed altogether.

The MCA and Pioneer romance produced a new industrial machine called the Pioneer PR-7820.

Pioneer made substantial improvements to the industrial players, which were relatively problem-free, especially when compared to the Philips (Magnavox) consumer players. Pioneer eventually also produced a consumer machine, the VP-1000, which cost less than Magnavox’s and had a remote control. It was certainly more reliable and produced what many considered a superior image.

Pioneer salespeople fanned the flames between Philips and MCA, showing unhappy customers returning with apparently defective discs that played just fine on a brand new Pioneer VP-1000, thank you very much.

The gossip soon spread that it was not the MCA discs that were wayward, but the Philips Magnavision players. And when consumers began to return or trade in their Magnavision players for new ones manufactured by Pioneer, this was the final stab in the back from MCA to Philips.

A messy divorce soon followed.

MCA flirted for a while with IBM, but Big Blue also left MCA red-faced when their players experienced a high defective rate as well.

So MCA set her sights on Pioneer, settled down mainly in Japan and, for a few years at least, enjoyed some peace and prosperity.

You see, Japan was a country where consumers needed to purchase, not rent their software. This proved to be a friendlier, much more stable environment for the LaserDisc. In Japan, the VCR and LaserDisc could co-exist nicely in this polygamist market, where VCRs could record television programs while LaserDiscs could playback movies. Thus almost immediately, the LaserDisc enjoyed a warm and fuzzy side-by-side relationship with the VCR in Japan.

Eager to get off to a fresh start, Pioneer and MCA decided to completely change the name of the beleaguered DiscoVision to Pioneer LaserDisc.

But MCA was homesick for the US.

She had been funding the LaserDisc since 1969, fighting an uphill legal battle against the VCR, was still plagued with quality problems with the discs manufactured in California, and needed to continue to invest millions in a format that was all but dead in the US.

More than that, President of MCA Lew Wasserman’s “crowning glory” had become a corporate embarrassment and an industry joke. Despite years of commitment to the format, Lew Wasserman finally felt it was time to throw in the towel and declare the LaserDisc a loser in the video wars.

MCA and IBM also wanted out, and Pioneer would finally have full responsibility for doing what it could with the LaserDisc.
In February 1982, the announcement was made that the sale of MCA’s Carson, California, plant was imminent, and that both IBM and MCA would no longer be in the business of manufacturing LaserDiscs. The sale was finalized a month later.

By 1989, all the patents were to pass on to Pioneer as well, for an estimated purchase price of $200 million.

But the spurned Philips also prowled around and joined forces with Sony, setting up a joint task force of engineers whose mission was to design the new digital audio disc. Philips contributed the general manufacturing process, based on the video LaserDisc technology, and the CD (Compact Disc) was soon born out of this partnership.

DiscoVision, her name changed to Pioneer LaserDisc, grew up quite nicely in Japan, eventually acquiring about 10% of the market. In 2001, though, she finally retired and completely passed the optical video legacy over to her offspring, the DVD.

And in the final analysis, the troubled union of Philips to MCA did have something of a happy ending. On December 24, 2005, PC World recognized DiscoVision as #37 in the greatest gadgets of the past 50 years.

DiscoVision, after all, did provide the DNA that ultimately gave birth to the DVD and that technology lives on happily ever after.

The End