The story of the format war between the VHS and Betamax standards begins in 1971, when Sony invented the U-matic, the first closed case video format. This format was far too expensive to introduce for home use, so it was designed only for commercial and professional purposes. Taking advantage of the knowledge discovered throughout this process, Sony soon invented the Betamax, which it presented to its competitors in 1974 in hopes of establishing it as the industry standard video recording device (VCR).
However, this did not go over well with Sony’s potential partners, who disliked the company’s apparent need for control, first with the U-matic, and now with the Betamax. Konosuke Matsushita, founder of Matsushita (now Panasonic) was unhappy that he had not been consulted about the Betamax design. JVC responded with the intention to make their own VCR standard that would be interoperable with Betamax.
VHS and Betamax: Which Was Better?
Betamax, in many ways, was the superior format. Beta had better resolution, less video noise, better sound quality, and used a better machine to play its cassettes.
The VHS and its cassettes, while being less complex, held one key advantage over Beta: a VHS tape could initially record up to two hours of content, as opposed to Beta’s launch recording time of just one. This meant that if you were out for the evening and wanted to record a movie, you could simply tape it via your VCR and watch the VHS another time. With a Beta player, you would have to switch the tape out halfway through.
Betamax Loses the Advantage
When it was first released in 1975, Betamax controlled 100 percent of the market share for home video, simply because it was the only piece of technology for that purpose at the time. Beta’s year head start gave it plenty of time to introduce Sony’s product to the consumer, and by 1976, 100,000 Beta players had been sold.
One of the key problems with Sony’s handling of Betamax was their marketing. Sony’s main message to customers was that you could record anything off live television, a task that not only the VHS could also accomplish, but could do for twice as long.
As Sony put great pride in their technologically advanced machine, it overlooked the fact that consumers prefer to save money. To many of them, the greater picture and sound quality of Betamax was insignificant and often unnoticed. However, because of its heavy weight from more components, Betamax was much more costly. When given the choice between the two, the consumer would almost always pick the cheaper format.
Another key advantage of VHS was its more open policy for partners, which effectively made it into an open standard. As more companies and even film and television studios aligned themselves with the VHS, it became difficult for others to choose Betamax. For example, when Konosuke Matsushita placed samples of the Sony and JVC products with the lids removed on their desk, he stated “it pains me to have to reject Betamax, but the JVC product has fewer components. My company must choose the product that can be manufactured more cheaply, whether by 100 yen or 1000 yen per unit. That is the only way to overcome the disadvantage of being a latecomer.”
Many of these issues were only present with earlier Betamax technology, and Sony solved many of them in response: recording time was extended, prices dropped even lower than those for VHS players at the time, and more companies backed the format (by 1984, the Beta group numbered 12 firms, but VHS numbered 40 companies).
Ultimately, these efforts made by Sony to better meet the needs of the consumer were too late, and the rise of VHS as the standard encouraged consumers to gravitate towards the technology that seemed less likely to become obsolete. Additionally, a larger economy of scale kicked in for VHS, keeping it very affordable. In 1988, Sony officially conceded defeat by beginning to make VHS players, generally keeping Betamax players only for use in video camera recording.
Even though Betamax was no longer the industry standard and became a rarity, Sony didn’t officially stop making Betamax players until 2002. In fact, the format wasn’t officially dead until Sony ceased production of Betamax videocassettes in March 2016.
A format war is one of the primary methods in which a standard can established, but it leads to a great deal of loss. This not only includes financial damage inflicted to the companies and retailers that back the losing format or standard, but that brought upon the customers that decide to purchase it before it meets its demise. Throughout the Seventies and Eighties, many people purchased Betamax players for a very hefty cost, and they had to later purchase the universal VCR alternative if they wanted to continue to watch and record movies and television shows. Voluntary consensus standards, as conducted by ANSI-accredited standards developing organizations, avoid much of this issue, as they encourage companies to work together instead of against each other.