Television digest with AM-FM reports (Jan-Dec 1951)

DEFENSE ORDERS AREN'T THE ANSWER: Defense Dept, and mobilization agencies are fully aware of vital necessity of keeping electronics plants going, safeguarding their skilled manpower reservoir — but no one we've contacted feels that current letdown is due to mobilization program. Official attitude can best be summed up thus; "We can hardly be blamed because you miscalculated your civilian markets and overproduced." Short of upsurge of public demand for TVs, only thing that might really help now is more military production orders — but military simply doesn't have that kind of money. Defense Dept, has pushed subcontracting and spreading of orders, and NPA has proved sympathetic to industry's woes by helping on cobalt, steel . aluminum, and in other situations. But these haven't solved problem. RTMA chairman Robert Sprague, speaking to Armed Forces Communications Assn, last week, not only explained trade picture (Vol. 7:16) but posed what he called the "$64 questions" ; What will be the total military and civilian production for the third and fourth quarters of 1951? And for 1952? What are industry and individual company prospects? His answers were realistic , not too reassuring; "Despite the rather sizeable allotment of public funds for the purchase of military electronic equipment and components, it seems apparent that the nation's military needs, short of an all-out war, will not absorb production facilities. "Our latest information indicates that military electronics production will reach a peak annual rate of about $2.5 billion in the fall of 1952, and thereafter decline to an annual rate of about $1.5 billion. [Vol. 7:3]. This might appear to be a very heavy schedule of military production, if merely compared with the 1950 total output of about billion. Actually, it probably will not absorb more than half of the industry's production facilities, even at its peak, due chiefly to the fact that military production dollars have about half the impact on our industry as civilian production dollars. This is due to several factors, but principally because a considerable portion of special and elaborate mechanical gear is obtained from manufacturers not considered a part of our industry. "A disturbing aspect of the present rearmament program is that the military load is not, for a variety of reasons, evenly distributed throughout the industry. Perhaps it cannot be evenly distributed. Nevertheless, many manufacturers are in danger of being caught in a squeeze between material shortages on the one hand and insufficient or no military orders on the other. Already some of the smaller manufacturers are in this difficulty. "This condition might not be alarming were it not for the recognized essentiality of electronics to modern warfare. Because of the importance of electronics to our national defense, it is dangerous to permit any significant number of manufacturers of either end equipment or components to fall by the wayside..." * * ♦ * Four current industry problems were stressed by Leslie F. Muter, president of Muter Co., past president of RMA, speaking before same convention April 19; (1) Credit restrictions. (2) Stockpiling of critical materials. (3) Military contracting procedures. (4) "Pirating" of engineers. Said he; "I believe that a more realistic program of credit and stockpiling must be quickly adopted or we will be struggling with deflation instead of the widelyheralded inflation." Stockpiling, he said, "is evidently being conducted on a basis that indicates a more serious situation than we have thus far been informed." He was glad to see more negotiated contracts replacing bidding since bidding frequently resulted in awards to companies poorly-qualified to deliver the goods. He added: "I feel that the pirating of highly-skilled engineering personnel should be considered before additional contracts are placed with companies that do not possess the staffs and facilities to meet the problem." 10