MiniDisc vies with DCC in home recording market - Sony Corp.'s MiniDisc compact disc recorder, digital compact cassettes

Discount Store News, August 17, 1992 by Pete Hisey

Sony's MiniDisc, the recordable, erasable version of the compact dis, is due on the market this fal, joining DCC as the would-be successors to the failed DAT format for digitall home recording. Until recently, DCC was the overwhelming favorite in a race that will probably see only one winner.

DCc has the support of an industry full of manufacturers, including Philips and other hardware vendors as well as software vendors like BASF and Fuji. The record industry will support the format with hundreds of prerecorded titles. And, several manufacturers will debut decks at various price points and in all lines of distribution this fall. Sony, in contrast, has only itself and its publishing and software arms to support MD, apart from blank media manufacturers Maxell and TDK.

On the face of it, DCC looks like an easy winner. "The support of the music industry is vital, and DCC has that support," noted BASF's Daniel Malcorps. "And, consumers will still be able to play the billions of standard cassettes that are out there today. With MD, they'd have to throw them away."

But retailers are now having second thoughts. "It's just a hunch, but I think MD looks really good," said Best Buy president Brad Anderson. "I think it fits more closely with what consumer want." Americans really love compact discs and miniaturized products, he said, and will respond favorably to a technology that makes the product both smaller and more flexible.

Sony Recording Media of America executive vp Andrew Mougis concurred. "MiniDisc combines two of the most successful technologies in the history of the consumer electronics field, the Walkman and the compact disc," he said. "MD offers a package of portability, recordability, digital sound and instant access" that no tape, digital or analog, can match, he added.

And, there are signs that consumers are tiring of their standard cassettes, a prime selling point for DCC, which will play both digital and compact cassettes. Last year, shipments or prerecorded audio cassettes plummeted 20% to 360 million, while CD shipments surged to 333 million units. Blank cassettes have been essentially flat for years, and the sale of traditional cassette recorders, based on industry shipments, has been on the decline.

The cassette was a revolution in its time, but its shortcomings are perhaps overwhelming the consumer. Casssettes, as a rule, don't last long and are prone to damage. Cassette players require a relatively high degree of maintenance, and personal cassette players have a very short service life. The vaunted backward compatability of DCC migh actually become a negative, reminding consumers of a technology they're not all that fond of.

Until MD, however, CD technology could not address the cassette's major advantages--low cost, easy portability and recordability. While Sony won't discuss price before introduction, MD will probably undercut DCC and fall to mass market price points more quickly. And, it will more than adequately meet the latter two concerns, and add on high performance, long software and hardware life, and precise reproduction under difficult circumstances (like jogging).

Simply having the best technology, of course, is far from a guarantee of success. Sony had a great product in its Beta videotape system a decade ago, and was hammered by the combined forces of Japanese, European and American producers, who licensed VHS technology from JVC and quickly established such dominant market share that prerecorded Beta software, particularly rental software, was next to impossible to find.

The same could happen to MD. After resisting DAT to the bitter end, the American music industry will support DCC, but appears to be much less supportive of MD (with the obvious exception of Sony Music). And, virtually the same wide-ranging array of manufacturers that buried Beta are moving into DCC. However, Sony has two significant advantages; consumers have voted with their dollars for CD technology over tape (and would probably do the same for Laser Disk if they didn't already have such large libraries of VHS tape), and Sony can probably undercut DCC by a significant margin. And, one MD unit can replace three pieces of hardware--the home cassette recorder, the personal tape player and the car stereo, while no DCC product yet announced is intended to be multi-function.

Retailers have been upset about having to develop new racking for MD, but that concern may have become a moot point. "Now that the industry is getting rid of the longbox, we're going to have to come up with new fixtures anyway," said Best Buy's Anderson. "There's no real added problem because of MD."