Time is right to approach Japanese MSX producers - Home computer market

Discount Store News, Jan 9, 1984 by Doug Stinson

Seems like mass merchandise computer buyers are all dressed up with no place to go.

Thousands of stores have the space and the shoppers, and hundreds of buyers have the dollars to make the home computer market finally happen--but they've been left standing at the altar.

After you've sold off the last of the Texas Instruments 99/4A's in your warehouses, and taken delivery of a few Commodore 64's, what next?

You could wait for Texas Instruments, which is rumored to be developing a down-sized, down-priced version of its critically acclaimed professional desktop micro. TI engineers have all received manuals on the Intel 8088 microprocessor, the heart and soul of IBM compatible computers, according to the rumor, and are designing a compatible high-end home computer.

The answer may be to jump up a class, to the Apple IIe computer. It's a solid machine, with a lot of owner-hours, a lot of distribution, tons of software and the highest brand awareness among United States households. But, it's a high-end home machine, leaving a big hole between the under-$200 Commodore 64 and the $1,000 IIe.

The best answer may be to sit out this dance, and wait for the 1984 back-to-school and Christmas seasons when the MSX machines may be available.

What's MSX? It's an operating system that is being used by several Japanese firms right now, in the Japanese market, and which may come across the ocean if the void between the Commodore 64 and Apple IIe isn't filled by one of the American manufacturers.

Sanyo, Toshiba, Yamaha, Mitsubishi and Matsushita all have home computers using MSX; others will follow. Microsoft is the developer of the operating system, and will presumably support it with home applications software. Romox, the in-store electronic distributor of programming, is also supporting MSX. The consumer is ready to step in with his dollars to make it all work.

Recent market research has shown that 22% of the people who intend to buy a computer in the next six months plan to buy it at a "discount department store or other department store." (That's going to be tough, since there's nothing on the shelf; but that's what they intend.)

A third of the purchase-intenders expect to spend less than $500--which in the next six months, means Commodore 64 and the Atari 600XL and 800XL machines.

The time is right for mass merchandisers to approach the Japanese MSX manufacturers. There is a strong demand for home computers under $500, from dependable high-volume vendors, and strong retail distribution is available through the nation's discount department stores and catalog showrooms.

In the meantime, get your software merchandising set for the high-end home market that is developing. IBM probably won't talk to you about selling the PCjr (yet). But, PCjr software will soon be available, and you should be in that market in a big way. Apple and IBM PC software are other categories to invest in, and so are KD computer furniture, accessories and books. They're all high-margin items, and will keep you in the public's mind as a computer materials source.

Take a look at alternative distribution, too. Companies that provide catalogs for mail-order business in your stores, and at least one company with an electronic distribution system are around, and can provide low-cost alternatives to risky software inventory investments.