How failure to listen to the market led to the demise of Betamax
Over the years there have been many format wars including Nintendo/Sega, Playstation/Xbox, Apple/Android, Kelly/Topanga — but there was one format war that ruled them all…
The battle between VHS and Betamax started in the late 1970s and stretched well into the 80s. As video players became more affordable, the battle continued to grow with VHS ultimately winning. Betamax dominated the industry at first but refused to listen to the market, and it led to their ultimate demise.
The Creation of the VCR
The VCR as a tape player goes farther back than you may realize. The Ampex corporation created the VCR in 1956, and they called it the VRX-1000. It used a rotating head design to record video and audio on a magnetic track and cost a cool $50,000.
No one could afford to pay for something like this, and even if you could, you needed an actual technician to help run it. The VRX-1000 also had a lifespan of only a few hundred hours.
The odd thing was, it wasn’t intended for television companies — so who was it for? Despite the cost, some networks instantly recognized the prospect of the new technology: they wouldn’t have to always rely on live TV.
Networks could record their shows live onto film to be played over the broadcast. They didn’t edit the film, so everything that happened live stayed in the recording, but it meant they didn’t have to do multiple live broadcasts.
The Sony U-Matic and the Progression of the VCR
A prototype for the first commercial VCR debuted in October 1969 in Japan. Sony wanted to come up with an industry standard, and they did with the Sony U-Matic in 1971.
This would be the world’s first video cassette recording format. It used tapes that were a bit bigger than a standard VHS tape and only had a maximum playing time of 60 minutes.
Phillips was also in the game and had brought out a home video cassette format in 1970 made just for TV stations. It would become available on the consumer market in 1972. The machine was originally called the N1500, but Phillips had a unique name for this new format: Video Cassette Recording, or VCR for short.
So we’ve only got one format, but the concept of the VCR is taking off. The industry boomed in the 80s with 30% of households owning one by 1985. By 1995, it would be 85%. But before the VCR would become commonplace in most households, it would split into two different formats: Betamax and VHS.
The Creation of Betamax
Sony started in 1974 with a prototype for the video recording system called Betamax. At the same time, JVC was looking at going with a different format. This caused enough of a commotion that Sony appealed to the Japanese Ministry of Trade and Industry.
It was at that moment they inadvertently started the format wars.
Sony released its first Betamax machines in 1975 and used cassette tapes that had a 0.50-inch wide tape inside. The Beta tape was “hand-sized” for easier use — not that handling a videotape is the most strenuous thing in the world.
If you’ve wondered why the name Beta, it’s because the word has a double meaning; Beta is the Japanese word to describe how signals are recorded on the tape, and the shape of the Greek letter B showed the way the tape moved throughout the machine.
The one problem that plagued Sony right out of the gate was the length of the tape. For the TV industry, past machines had a tape length of one hour. This made sense as most shows — including commercials — were never longer than an hour.
This issue would help lead to their ultimate failure.
The Creation of the VHS
Sony could have controlled the entire VCR industry, but their attempt to dictate the industry-standard backfired. They had approached JVC about selling the patent of the Betamax so that JVC could do the manufacturing.
This had happened already with the U-Matic and ended up with Sony dominating the industry. JVC made the very smart decision to decline the offer but come up with their own technology and format.
JVC had been experimenting with a new VCR as early as 1971, but in 1977, they introduced The Video Home System or VHS for short. JVC also came up with a set of guidelines that would be paramount in the existence of VHS.
Just call it the “95 Theses” of the home video industry, but JVC gave it a cooler name: The VHS Development Matrix.
- The system must be compatible with any ordinary television set.
- Picture quality must be like normal air broadcasts.
- The tape must have at least a two-hour recording capacity.
- Tapes must be interchangeable between machines.
- The overall system should be versatile, meaning it can be scaled and expanded, such as connecting a video camera, or dub between two recorders.
- Recorders should be affordable, easy to operate, and have low maintenance costs.
- Recorders must be capable of being produced in high volume, their parts must be interchangeable, and they must be easy to service.
One big difference here is the fact JVC wanted their standard to be used by other manufacturers and not controlled the way Sony was with Beta. JVC persuaded Hitachi, Mitsubishi, and Sharp to sail on the good ship VHS.
VHS was using a bigger videotape than the more compact and convenient Beta, but with one big difference: it had a longer recording time. A VHS tape could record 2 hours, which was enough to cover most movies — including commercials — or four regular sitcoms.
It didn’t take long for advancements to happen. A VHS VCR now had different recording settings such as SP, LP, and SLP. You could now slow down the speed of the tape as it recorded. This would reduce the quality but give you double and triple the storage capacity. The VHS cassette tape was big enough to hold around 1400 feet of tape and could hold 6 hours of recording with no problem.
And this would be the centerpiece of the war.
VHS & Betamax Go Head to Head
When it came down to quality, it looked like Betamax had VHS beat. Both concepts used a horizontal resolution involving lines, and Beta had a slightly higher resolution of around 250 lines.
They could get this up to around 290 with the SuperBeta, but this was in 1985 and they were starting to lose the format war.
There’s always been this idea that Beta was vastly superior with picture quality, but when you look back at the technical details of two average machines — they ended up being almost identical.
It was the earliest version of Betamax that had a superior picture, but this was before it became mainstream. A big reason for this idea of Beta always being the superior version was mainly because of the marketing by Sony. People just bought into it.
Not only was recording length a primary factor of the VHS vs Betamax wars, but retail price was an issue. Because JVC brought other manufacturers into the mix, they could all compete against one another. It allowed for lower prices for the consumer, but ultimately more sales overall.
By 1984 there were over 70 different VCR manufacturers. It’s hard to pinpoint exact prices, but in 1985, most VHS players sold between $200 and $400. This was hundreds less than a Betamax.
The Outcome of the Format War
Betamax may have had a slightly better picture, a bit better audio, and a more stable image (as Sony would have you believe) but the big problem — besides price — came down to recording time and specifically one thing: football.
One of the biggest early complaints about Betamax was the inability to record football games, which can average 3 hours. People already knew that a VCR could record TV shows and most movies, but the feedback continued to be about not being able to fit an entire sports event on a Betamax tape.
The other problem was that it didn’t take long for the VCR to become synonymous with VHS. Although Betamax owned 100% of the market in 1975, by 1980 VHS was controlling 60% of the market.
By 1981 Beta sales had dropped to just 25% of the VCR market. By 1986 it was just 7.5%.
There’s always been this myth that the porn industry was involved with pushing Betamax away for not wanting to be their format of choice, but there’s no truth in this. Fewer and fewer people were choosing the more expensive option with the limited recording capacity.
It was the combination of poor sales along with the huge rise of the video rental market. Movie studios and video rental stores turned away from Betamax. It just wasn’t worth it for them to stock every movie title in Betamax format. The lack of available titles — and the low market share — allowed VHS to keep to a distant lead.
The Final Demise of Beta
Sales of Betamax eventually dwindled enough to allow VHS to emerge as the victor in the format wars. The sign that it was all over would come in 1988 when Sony threw in the towel and started making VHS machines.
But it was too little, too late. By 1987, 95% of all VCRs in the world used the VHS format.
What it all came down to was Sony ignoring what the market wanted. They didn’t listen to the public and decided that a 1-hour tape was all people needed. It would be the football games that sunk them in the long run.
Sony clung to the idea that people wanted superior quality, but that wasn’t the case. As usual, people wanted cheaper, better usage, and compatibility. They found this with VHS.
VHS would rule for an amazing 40 years, but ultimately it would die out to DVD and then Blu-ray. The VHS/BETA format war is an interesting look at a company trying to dictate the market and not listening to what the public really wants.
And always remember: Be Kind. Rewind (if you’re under 25, just ask your parents).
If you want to check out more great stuff from the 80s, head on over to everything80spodcast.com to relive the greatest decade. Tell ’em Large Marge sent ya…