Weekly television digest (Jan-Dec 1963)

8-TELEVISION DIGEST DECEMBER 30, 1963 JAPANESE ADVANTAGE IN ALL-CHANNEL LAW? Two recent interpretations of all-channel law appear to give Japanese manufactiirers advantage over U. S. set makers after U-Day rolls around. However, it's our impression that there's so much confusion in Japanese TV industry that it won't necessarily work out that way. Here are aspects of rulings which could work to benefit of manufacturers & inoporters of foreignmade TV sets: (1) Imported vhf-only sets could be selling in U. S. after domestic stocks are exhausted. This is because of longer shipping lead-time involved in foreign sets— usually 30-45 days. All-channel law establishes April 30 cut-off date for manufacture of imported vhf-ordy sets as well as domestic ones. Thus, all sets being shipped by U. S. manufacturers theoretically will be all-channel shortly after May 1— barring stockpiling. But because of shipping time, importers probably won't have to begin shipping compulsory all-channel sets until June 1-15, simply because sets received before that time will have been built before law went into effect. (2) FCC recently ruled, in response to query from EIA of Japan, that vhf set sold with uhf adapter would meet requirements of all-channel law, "providing that removal of adapter would disable set." While this ruling is of little significance to U. S. manufacturers, it's of top importance to Japanese makers of tiny transistor TV. In effect, it eliminates necessity for expensive retooling. There's no room for additional uhf tuners in current Japanese micro TV sets. Addition of adapter (with some sort of interlock to disable set if adapter is removed) solves problem very neatly. (Sony, however, has already tooled slightly larger version of its 5 -in. set including internal uhf tuner.) It also makes it possible for Japanese manufacturers to continue producing virtually same set for U. S. & domestic market. Only difference currently is slight variation between U. S. & Japanese vhf channels (meaning different vhf tuners); thus, same tooling could still be used for both domestic (vhfonly) & U. S. export (vhf set plus adapter) models. It's very possible that Japanese TV industry will dissipate these built-in advantages, however. Reports from Tokyo indicate Japan is even less prepared for switch to all-channel than U. S. industry. It's said that TV manufacturers there are having difficulty getting firm commitments from their uhf tuner suppliers. Some producers are still placing stock in rumors— "hot from Washington" — that U-Day will be postponed for year. Despite heavy information program by EIAJ, it's understood that much of Japanese TV industry is fuzzy on meaning of law and is failing to prepare itself. ♦ ♦ ♦ ♦ Some indication of slowdown in TV set shipments shows up in Nov. Japan-to-U. S. export figures. As reported by "Home Furnishings Daily," they show only 5% increase from Nov. 1962— by far the smallest 1963-over1962 rise for any month. In Nov., 36,079 sets were shipped, bringing 11-month total to 402, 364 (equivalent to 6% of U. S. b&w production for same period), up from 137, 872 for first 11 months of 1962. Shipments of transistor & tube radios (excluding toys) from Japan to U. S. reached whopping total of 9, 219, 691 for first 11 months. This compares with U. S. domestic output of 9, 606, 798 during same period. Nov. Japan-to-U. S. shipments of transistor radios rose big 53% over Nov. 1962 figure to reach 1, 053, 758. Tube radio shipments were down 16% to 104, 755; toys (fewer than 3 transistors) dropped by 60% to 78, 499. DISCOUNTERS FACE RISING COSTS IN '64: Cost of doing business is rising in low-margin retail field & can be expected to put new pressure on profits in forthcoming year, our survey of some 2 dozen top discount chains indicates. Several new trends, and intensification of previous ones, presage tougher going in 1964 for discount houses. More capital wiU be invested than ever before to transform discount image from "shlock" to quality. There will be decreasing emphasis on junk merchandise, more on upgraded product lines. Store personnel will be more qualified, better trained— and more costly. Then, too, rise in union activities which became pronoimced this year can be expected to become more intensive & widespread— and to boost costs. t