Weekly television digest (Jan-Dec 1963)

lO-TELEVISION DIGEST OCTOBER 21, 1963 TUBE IMPLOSION SUIT: Nebulous and nettlesome area of implied warranty got one of its infrequent flashes of limelight last week via $7, 500 suit filed against Muntz TV in Chicago Superior Court by dealer Cain-Sloan Co. , Nashville, Tenn. department store subsidiary of Allied Stores. Case is outgrowth of 1961 TV set implosion. Woman purchaser of set recently won breach-of-warranty personal injury suit and $5, 250 judgment against Cain-Sloan, and the latter's insurance company, U. S. Fidelity & Guaranty, now seeks to recoup judgment plus costs from Muntz TV. TV was private-label Ambassador-brand model made by Muntz for Allied Stores. Tube was from National Video. "We tried to get Muntz TV and National Video to defend but they refused," we were told by William Brooks, attorney in claims department of USFG's Nashville office who investigated original claim. He noted that plaintiff suffered no direct personal injury from set, explained: "Nothing from the set touched her. The implosion frightened her and she fell off a hassock and hurt her back." Case was filed against dealer Cain-Sloan under Tennessee's Sales Act which makes retailer responsible for the "merchantability" of the product he sells— i.e., that it is safe, efficient and sold without risk to buyer. Jury found for plaintiff on grounds that set was imperfect in some fashion. Nashville trial established that set had its original picture tube. Brooks told us. "Some service work had been done on the set," he added, "but not on the tube. Since Muntz and National Video wouldn't defend, we, as insurers for Cain-Sloan, had to defend. It's now proper procedure to proceed against the manufacturer to recoup." Suit against Muntz is being handled through USFG's Chicago office. "We're covered by product liability insurance," Muntz TV Treas. Daniel J. Domin told us, "and we've turned the entire matter over to our insurance company. When the original case was filed, our insurance company advised us that we were not involved because the suit wasn't filed against us. We're fuUy protected, and I believe the insurance company would take the position that if the set had been serviced we're off the hook. Servicing should take the manufacturer off the hook, because once the back of the set is taken off, you can never know what happened to it. "This whole area of implied warranty is vague and complicated," he emphasized, "and that's why we all pay such high rates for protection. This is now a matter for our insurance people." GE will maintain policy of decentralization, because "the more decentralized we are, the more growth there will be," emphasized Pres. -elect Fred J. Borch (Vol. 3:41 plO) in Oct. 12 "N. Y. Times" interview. Overcapacity is prime problem facing U. S. electrical industry, he said, but believes that "because of this nation's economic growth, this is going to be a diminishing problem. " He sees as GE's major challenges in immediate years ahead; (1) Meeting world competition, (2) Intensifying R&D activities, (3) Increasing efficiency, (4) Servicing customers, (5) Maintaining balanced corporate growth. Borch said he "would like to see" sales distribution continue at present ratio of 75% commercial, 25% defense. Shortage of engineers and scientists for consumer product development may indicate that U. S. industry is not using manpower to best advantage, in opinion of GT&E Chmn. Donald C. Power. Addressing research and development management program at Battelle Memorial Institute, Columbus, O. , he noted that of more than $17. 5 billion that will be spent on R&D this year, 66% will come from govt., 31% from private industry, 3% from ncwi-profit organizations, emphasized that govt. & industrial R&D spending has increased since World War H "while industry's percentage has dropped." He said industry must strike reasonable balance in its over -all R&D activities, summed up: "If the total amount of R&D money provided by industry continues to grow at the rate of the past 10 years, let alone at the faster rate which I sincerely hope it will, the percentage of new products could weU reach as high as 20% or even greater." This related to conclusion of National Industrial Conference Board that industries with a high level of research spending relative to sales derive "an estimated 10% of their sales today from products that did not exist 4 years ago. " Olympic Cabinet Corp. is new wholly owned subsidiary of Olympic, established, according to Pres. Morris Sobin, "to insure continuity of Olympic's present source of cabinets." Olympic Cabinet wUl lease premises & fixed equipment of Nunn Better Cabinet Corp., Marietta, Ga., anticipates no changes in operation or personnel. Sobin said move won't affect arrangements with Olympic's other cabinet suppliers. Officers of Olympic Cabinet are Sobin, pres.; Sidney Rhodes, vp; Lewis Haber, treas.; Abraham Cooper, secy.; Harvey Schuster, asst, secy. Increase In prices of black-& -white picture tube yokes of approximately 8%, effective Nov. 4, was announced in letter to all major customers by Electronics Div. of Indiana General Corp., Keasbey, N.J. Sales mgr. Kenneth S. Talbot said company had been absorbing labor & material cost increases for 5 years, and the hikes reflect these additional costs. He emphasized that increases apply only to b&w yokes, not to other ferrite products. He added that Indiana General is now producing color yokes & color flybacks. Emerson has signed $4 million ad package with "Look" calling for insertions in "practically every issue" of magazine for next 3 years. Pres. Benjamin Abrams said "Look" schedule is largest magazine campaign ever conducted by Emerson, will represent company's "basic ad effort" for next 3 years. Campaign will feature complete Emerson line, includes both color and b&w inserts. Program begins with Dec. 3 issue. Ad agency: Robert Whitehill. Thlngs-are-tough-all-over dept.: 'Trices of radio & TV sets will be reduced by Italian manufacturers, " reports U. S. Commerce Dept.'s "International Commerce" magazine for Oct. 14. "This reduction is an attempt to curb the spread between list prices and those charged by discount stores." Home entertainment showroom in N.Y. will be built by Sylvania on street level of GT&E Bldg., 3rd Ave. & 45th St. Slated for completion in mid-Nov., it wiU occupy 1, 700 sq. ft. Westlnghouse has opened Japanese showroom on Tokyo's famous Ginza St. , is displaying color TVs among other products.