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RCA Press Release for January 7, 1981


Favorable Outlook for Video Consumer Products Keyed to Five Growth Areas, RCA Executive Says

LAS VEGAS, Jan. 7 --- Five specific growth areas will stimulate the video consumer products industry to record sales levels in 1981, an RCA executive forecast here today.

"Remote control television, personal-size color receivers and projection TV models, along with the developing video disc and video cassette recorder markets, should lend additional strength to a home video business that was exceptionally strong in 1980," said Jack K. Sauter, vice president and general manager of the RCA Consumer Electronics Division.

He said at the opening of the industry's Consumer Electronics Show that video consumer products in 1981 are expected to reach record dollar sales levels "despite the prospect of an uncertain economy."

At the same time, Mr. Sauter said, the emergence of the developing video disc will help to revitalize "one of the industry's most valuable assets, the independent television dealer." He said this particular segment of retailing "has not successfully participated in the VCR business, mostly by choice."

In reviewing the anticipated five growth areas of the video industry, Mr. Sauter forecast:

-- Remote control receivers should account for some 35 percent of all color TV unit sales in 1981, a continuing exceptional growth in recent years. Currently, remote control sets account for one of every four color television sales.

-- Projection television receivers will amount to approximately $175 million in new business for the video industry in 1981 as more brand names, including RCA, enter the business. "While industry sales are difficult to measure at this formative stage of the business, total projection TV sales should exceed 65,000 units as a conservative estimate," Mr. Sauter said.

-- Personal-size color sets will become increasingly important in 1981 as dealers recognize the multi-set sales opportunities represented by nine-inch (diagonal) and smaller receivers. Mr. Sauter said the more compact size of these models will make them more attractive to the consumer for use in the bedroom, kitchen and office.

-- Video cassette recorders will continue their upward growth pattern exceeding the million unit sales level for the first time in 1981. Portable VCR units in particular will take an increasingly larger share of the business, "stimulating color camera sales in the process," Mr. Sauter said.

-- Video disc players will achieve national distribution during the year, setting the stage for subsequent explosive growth of an affordable new product that will be the most important addition to the predicted "video age of the 1980's." RCA expects to sell some 200,000 VideoDisc players bearing its brand in 1981, he said.

Mr. Sauter said the principal product of the industry's video business, color television, should again reach the 10-million unit sales level in 1981. Color TV, stimulated by improved performance and features, will continue to be an excellent value in today's economic environment. Industry sales of black-and-white receivers are expected to reach 6 million units this year.

"While the vigorous growth elements are in place for a video explosion in this decade, I doubt that this will happen unless we have the full support of the retail universe, particularly the independent television dealer. At the same time, retailers need a product like the video disc to make their customers aware that they are truly in the video business," Mr. Sauter added.

"While manufacturers can develop new products, much depends on the television dealer making a commitment to be a leader in the video market of the 1980's." He said, "A casual participant simply will not share in the growth that lies ahead."

Mr. Sauter urged independent TV dealers to consider dedicating meaningful areas of floor space, investing in sales training and to be more active in promoting the new video products. "If they do not establish themselves as respected video dealers, then the obvious alternative is to sell the commodity items of the business and settle for the thin profits that go with commodity selling."


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