Wednesday, July 26, 2006

Valenti on the VCR

I came across this interesting passage from page 110 of J.D. Lasica's book this afternoon at lunch: In the late 1970s and early '80s, Universal City Studios and Walt Disney Productions sued Sony, trying to stop the sale of VCRs. Hollywood claimed VCRs violated federal law by letting viewers time-shift programming and build home libraries of videotaped movies without the copyright owners' permission. Jack Valenti famously told Congress in 1982, "The VCR is to the American film producer and the American public as the Boston Strangler is to the woman home alone." What a short-sighted dick.

I found the transcript of that testimony, for which he brought a bunch of Hollywood bigwigs (including Clint Eastwood) with him to testify in front of a House judiciary sub-committee. Extended excerpt:

Mr. VALENTI. And 6 out of 10 films do not retrieve their total investment period. Now, what are you going to do right on top of that? There is going to be a VCR avalanche. Exports of VCR's from Japan totaled 2.57 million units in 1981. No. 2, the United States is the biggest market. No. 3, February 1982, which is the latest data, shows the imports to the United States are up 57 percent over 1981. This is more than a tidal wave. It is more than an avalanche. It is here.

Now, that is where the problem is. You take the high risk, which means we must go by the aftermarkets to recoup our investments. If those aftermarkets are decimated, shrunken, collapsed because of what I am going to be explaining to you in a minute, because of the fact that the VCR is stripping those things clean, those markets clean of our profit potential, you are going to have devastation in this marketplace.

Now, is this all? Is it going to get any bigger? Well, I assure you it is. Here is the weekly Variety, Wednesday, March 10. Head1ine, "Sony Sees $400 Billion Global Electronics Business by the Decade's End," $400 billion by the decade's end. In 1981, Mr. Chairman, this United States had a $5.3 billion trade deficit with Japan on electronic equipment alone. We are going to bleed and bleed and hemorrhage, unless this Congress at least protects one industry that is able to retrieve a surplus balance of trade and whose total future depends on its protection from the savagery and the ravages of this machine.

Now, the question comes, well, all right, what is wrong with the VCR. One of the Japanese lobbyists, Mr. Ferris, has said that the VCR -- well, if I am saying something wrong, forgive me. I don't know. He certainly is not MGM's lobbyist. That is for sure. He has said that the VCR is the greatest friend that the American film producer ever had.

I say to you that the VCR is to the American film producer and the American public as the Boston strangler is to the woman home alone.

The VCR avalanche, I told you about that. Now, what about the VCR owners. Now, from here on out, Mr. Chairman, I am going to be speaking about a survey done by the Media Statistics Inc., which is a prestigious firm out of Silver Spring, Md. We, meaning the MPAA, did not commission this survey. We bought it after it was done when we heard about it. So, this was not a case -- we have commissioned a lot of things, but this is not one of them.

Now, I want to tell you about it because I think it is absolutely fascinating. This survey was taken in October 1981. It is the newest and freshest data available. Here is what it says. Median income of a VCR owner is between $35,000 and $50,000 a year. Not a lot of what we call today the truly needy are buying these machines. One-third of all the owners have incomes of more than $50,000. Now, here is the next one: 87 percent, 86.8 percent of all these owners erase or skip commercials. I have here, Mr. Chairman, if you are not aware of how this works -- this is Panasonic. This is a little remote control device that you use on machines. It has on here channel, rewind, stop, fast forward, pause, fast advance, slow, up, down, and visual search, either going left or right. (Note: Oooooooh! Woooow!)

Now, let me tell you what Sony says about this thing. These are not my words. They are right straight from McCann Erickson, whom you will hear from tomorrow, who is the advertising agency for Sony and here is what they say. They advertise a variable beta scan feature that lets you adjust the speed at which you can view the tape from 5 times up to 20 times the normal speed.

Now, what does that mean, Mr. Chairman? It means that when you are playing back a recording, which you made 2 days or whenever -- you are playing it back. You are sitting in your home in your easy chair and here comes the commercial and it is right in the middle of a Clint Eastwood film and you don't want to be interrupted. So, what do you do? You pop this beta scan and a 1-minute commercial disappears in 2 seconds.

The rest goes on to show what a short-sighted control-freak whiny-ass he was and is.


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