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slower moving tape. As a result, it sometimes took as many as three cassettes to show an entire movie. This caused frustration both among video owners, who had to swap tapes over, and retailers, who had to supply more cassettes. The problem is explained by one anonymous VHS fan on the blockinfo.com Web site: ‘What made VHS succeed was that you could get a whole movie on a tape. Okay, maybe the picture and sound weren’t as good as Beta; but what the heck, you didn’t have to get up in the middle and switch cassettes. VHS delivered value on a dimension that mattered to consumers. Beta delivered excellent value on dimensions that did not.’ Sony refused to bite the bullet though. Indeed, it may have been losing market share but the number of units sold still continued to rise, peaking with global sales of 2.3 million units in 1984.

However, three years later VHS had gone way beyond the tipping point with a 95 per cent share of the market. In 1987, Rolling Stone magazine ran an article on Betamax (entitled ‘Format Wars’) and declared ‘the battle is over’. On 10 January 1988 Sony finally swallowed its pride and announced plans for a VHS line of video recorders.

Although Sony was adamant that the press should not see this as the ‘death’ of Betamax, the press weren’t listening. On 25 January, only a fortnight after Sony’s announcement, Time magazine published a eulogy to the brand with the headline, ‘Goodbye Beta’.

The same article also argued that Betamax had failed because it had refused to license the format to other firms. ‘While at first Sony kept its Beta technology mostly to itself, JVC, the Japanese inventor of VHS, shared its secret with a raft of other firms.’ This claim has since been hotly disputed by the defenders of Betamax. For instance, one AFU (Alt Folklore Urban) white paper on The Decline and Fall of Betamax refers to the statement as ‘blatantly untrue’. According to James Lardner, author of Fast Forward, Sony invited JVC and Matsushita to license the Betamax technology in December 1974, but both companies declined the offer.

Either way, the fact that Betamax video recorders were only manufactured by Sony meant that it couldn’t compete against the growing number of companies pushing VHS. However, even when Sony started to make VHS machines it didn’t abandon Betamax. Overseas production of Betamax hobbled on until 1998, and in Sony’s home territory, Japan, machines were still being made until 2002, although not in huge numbers (Sony produced just 2,800 units in 2001).

On 22 August 2002 Sony finally announced it would be discontinuing Betamax products. ‘With digital machines and other new recording formats taking hold in the market, demand has continued to decline and it has become difficult to secure parts,’ the company said in a statement.

Now, of course, VHS itself is under threat from the rapid rise in digital versatile disc (DVD) players, and may not be able to survive in the long term. While DVD has finally drawn a line under the battle between Betamax and VHS, it has also managed to create its own destructive war between different DVD formats, and therefore delayed the take-off of that market.

However, at least some of the lessons of Betamax have been learnt. Sony and eight of its competitors eventually joined forces in 2002 to create a common format for DVD, meaning this time Sony was not left on the sidelines.

Lessons from Betamax

Don’t go it alone. ‘Contrary to popular belief, what would help every category pioneer is competition,’ says Al Ries. True, providing the competition isn’t pushing a format incompatible with your own.

Let others in. Whether Sony refused to license its format or not, there is no question that the company would have had a better chance if its rivals had adopted Betamax.

Cut your losses. Sony’s decision to ignore VHS until 1987 was, with hindsight, an undeniable mistake.

Supply equals demand. When the manufacturers of pre-recorded tapes decreased their supply of Beta format tapes, demand for Sony’s Betamax recorders inevitably waned.

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