Television digest with electronics reports (Jan-Dec 1955)

17 UPDATED FIGURES on electronics industry’s immediate and 10-year prospects — both electronics as a whole and TV-radio in particular — are offered by Sylvania chairman-president Don G. Mitchell in a year-end statement that sets forth figures that are even more startling than those which his finance v.p. W. Benton Harrison advanced before the Financial Analysts of Philadelphia in a widely-quoted speech last March 10 (see our Vol. 11:11 & full-text Supplement). Theirs are perhaps the most authoritative industry statistics of them all, for they’re the product of the research machinery of the industry’s Mr. Statistics himself — Frank W. Mansfield, Sylvania director of sales research and chairman of the RETMA statistical committee, some of whose forecasts we also published in Vol. 11 :47. It’s noteworthy that Mitchell revises most of the Harrison prognostications upward. In summary: (1) Electronics as whole will achieve sales of $10.8 billion in 1956, or nearly $1 billion more than 1955. By 1960, volume will exceed $15.6 billion; by 1965 it will be $22 billion. (Mr. Harrison had estimated $9 billion for this year and $20 billion by 1964.) (2) About 7,600,000 TV sets will have been sold to public during 1955, valued at $1,055 billion at factory. In 1956, TV set sales will be approximately 7,500,000, of which 200,000 are color sets, representing factory value of about $1 billion. In 1960, TV set sales will total 9,600,000 (31% of them color units) valued at $1,521 billion. In 1965, “it is likely” that 11,600,000 sets will be sold at factory price of nearly $2 billion. “Color is on the way, after a slow start,” says Mitchell, “But it will be ... 6 years before color TV unit sales catch up with black-&-white.” (3) Home radio sales this year will total 6,700,000 sets at factory value of $134,000,000; next year, 6,000,000 sets will be sold at $120,000,000; in 1960, about 7,000,000 at $133,000,000; by 1965, 7,300,000 at nearly $140,000,000. Add 7,000,000 auto radios this year at $175,000,000 factory Elsctronics Reports: “We are clearly on the threshold of an industrial age, the significance of which we cannot predict, and with potentialities which we cannot fully appreciate.” So said report on recent automation hearings (Vol. 11:44) by Senate-House subcommittee on economic stabilization, headed by Rep. Patman (D-Tex.). Stating that automation is due to advance to levels that “may well surpass the imagination,” report predicted that economic hardships and dislocations were inevitable, and that “maintenance of a good, healthy, dynamic and prospering economy” — rather than specific legislation — is best hope for the transition period. Excerpts from 13-p. printed report (available from committee on request) : “Along with automation and the introduction of laborsaving machinery and techniques in some parts of the economy, whole new industries have arisen and may be expected to arise. The electronics industry, for example, is today made up of hundreds of companies, both large and small, employing ever-increasing numbers.” But the subcommittee warns that these new industries will not take care of those displaced from older industries. Automation makes possible new goods and services. “The mass production of color TV turns upon the development of automatic processes for placing literally hundreds of thousands of separate and individual colored dots upon the face of a picture tube, a task all but beyond human capabilities for precision and tolerance for tedium . . .” AVhile employment potentials in new industries “may not be as high as they would seem at first thought,” sub value; in 1956, 6,000,000 at $150,000,000; 1960, 5,500,000 a^l37,000,000; 1965, 6,000,000 at $150,000,000. (4) TV picture tubes, radio receiving tubes, special electronic tubes and other components for repair purposes will amount to $680,400,000 at factory in 1955, $800,000,000 in 1956, $1.25 billion in 1960, in excess of $2 billion in 1966. (5) Records & phonographs should increase steadily from this year’s $121,000,000 to $123,000,000 in 1956, $136,000,000 in 1960, $144,000,000 in 1965 — and “the increasing demand for high-fidelity systems may increase this total substantially.” Foregoing are “factory door” prices, Mitchell emphasizes— and he estimates that sale of end products and parts through distribution channels should be just short of $2.2 billion this year, nearly $2.3 billion in 1956, more than $3.3 billion in 1960, at least $4.8 billion in 1965. To the foregoing he adds repairmen’s service, which he estimates at about $930,000,000 this year, nearly $1 billion next year, more than $1.23 billion in 1960, about $1,685 billion in 1965. Then there are also TV-radio broadcasting revenues: $1,435 billion this year, $1.9 billion in 1956, more than $3.4 billion in 1960, above $5.4 billion by 1965. * * * * Uncle Sam is biggest customer of the electronics industry as a whole, of course, his purchases in that field running 7.4% of all defense expenditures — and even without a “shooting war” Mitchell forecasts that this year’s total of just under $2.5 billion will be exceeded next year, maybe accounting for as much as 10%. “We see govt, purchases in the vicinity of $3.3 billion by 1960 and at nearly $4 billion in 1965,” he said. “These are only estimates, and it is quite possible that govt, purchases could double over 10 years.” As for so-called industrial uses of electronic systems and equipment — e.g., electronic computers, closed-circuit TV in factories, offices & homes, devices for auto safety and airport controls, other non-entertainment applications — the Sylvania chief estimated they totaled about $670,000,000 this year, should reach nearly $800,000,000 in 1956, will be about $1.2 billion in 1960, nearly $1.9 billion by 1965. committee draws attention to employment possibilities in service industries associated with new products. “For every employe counted as employed in TV manufacturing, countless local TV repairmen, scattered in every city and hamlet of the nation, depend for their livelihood on the mass production and mass distribution of the TV sets produced by automated industry.” Subcommittee was particularly disturbed by shortage of trained technicians and engineers, urged “fullest attention” to the problem of providing technical training to young people with demonstrated ability and aptitude. * * ♦ * To help relieve nickel shortage in 1956, Office of Defense Mobilization announced this week it will divert 4,100,000 lbs. monthly to private industry from scheduled shipments to Govt., same amounts as in Nov. & Dec. but double the monthly amounts diverted earlier this year. This sizable diversion is expected to prevent the “severe cutback” in production of receiving tubes which was predicted this month by RETMA pres. H. Leslie Hoffman in plea to Commerce Secy. Weeks for more nickel to industry (Vol. 11 :49) . Dr. Louis N. Ridenour, ex-v.p. of Paramount’s International Telemeter Corp., named director of Lockheed Aircraft Corp.’s missile systems div. research lab, succeeding Dr. Ernst Krause, who resigned along with about 16 other missile scientists over differences in policy matters. Since April 1955, Dr. Ridenour has been head of missile division’s program development branch.