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Show L',1 TCZ3 FCP HoaB TV TG3 Dec Sets Paced by the sale of Japanese-made video cassette recorders, the U.S. home video entertainment industry is vying for a billion-dollar consumer market. Our manufacturers were in this market before the Japanese, f)ut were beaten at the starting start-ing gate because of indecision as to which technology to introduce in-troduce tape or disc. AND'U.S. producers have failed, to date, to meet their competitors on the price front. Hence, several domestic domes-tic companies are buying time by marketing Japanese video tape recorders until their own disc systems are more cost-effective and ready for commercial distribution. In the opinion of the Research Department of Babson's Reports, the Japanese lead could be shortlived. short-lived. The battle in this dynamic growth field is just heating up, and if the video disc systems can be priced under the tapes (VTRs), American makers could start to forge ahead. AND IF the Japanese cannot can-not soon introduce a far less costly home color TV camera to go with their VTRs, the gap between tape and disc systems sys-tems will narrow. For the advantage ad-vantage now is the recording not just of TV programs but of personal bme movies as well. Meanwhile investors, champing at the bit, do have some American-investment vehicles to choose from in this exciting new entertainment medium. We believe that patience pa-tience will be required but that the potential for significant sig-nificant gains remains hieh. THERE ARE many differences among the several home video TV recorders and players currently on the market. The chief hurdle for consumers, however, is the fact that the tapes andor discs are incompatible with Jhe different sets, thus limiting limit-ing the owner in the choice of playback programs. Both Japanese and U.S. makers are working hard to develop common standards in order to eliminate this, and the problem should be resolved in the not too distant future. AS AN example of the changing technology, the video tape recorders can now allow the viewer to watch one channel while another is be- ing recorded. It can also record programs automatically. And the tape system not only can tape TV programs for replay but can also play pre-recorded tapes and via an optional TV camera can provide the home-grown live movies. ON THE other hand, for those interested only in viewing view-ing pre-recorded material the video discs could be more attractive at-tractive because of lower cost and a brighter and truer picture. pic-ture. The one current drawback draw-back is- still the higher price of the disc unit. The VTR industry line-up is divided between Sony and Matsushita. Zenith and Sears have lined up with Sony and place their labels on Sony sets. RCA, North American Philips (Magnavox), and GE are customers of Matsushita. INDICATIVE of the low market penetration is the fact that only 170,000 VTRs were sold in 1977, while nine million color TV sets were sold. This year sales of some 500,000 to 750,000 VTRs are expected, compared with some 9.5 million color sets. Dollar sales of VTRs were some $17 million in 1977, an estimated $450 million for this year, and could reach $1.3 billion by 1981. This vast potential does even include video discs or disc sets, all of which could create a far more extensive and remunerative market. THE RESEARCH Department Depart-ment of Babson's Reports is currently recommending North American Philips and RCA among the principal contenders for the home video TV recorder player crown. We also advise purchase of GE, but mainly for its other diversified electronicselectrical electronicselec-trical business depth. All three companies are listed on the New York Stock Exchange. UP-TO-DATE reports are available on these companies, and these may be obtained free of charge by writing to Babson's Reports Inc., Wellesley Hills, Mass. 02181. |