Word: rca
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Dates: during 1980-1989
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...RCA drops a $580 million...
...When RCA brought out its SelectaVision VideoDisc Player in 1981, it had visions of a huge new market. Dubbed the Manhattan Project during 15 years of development, SelectaVision works much like a phonograph. A diamond needle picks up video and audio signals from the tiny grooves of a silvery plastic disc whirling at 450 r.p.m. To operate the machine, which is connected to a TV set, the user simply inserts a disc and flips a lever...
Last week, though, RCA (1983 sales: $8.9 billion) announced that it will discontinue production of SelectaVision machines, thus putting a stop to losses on the device, which have already reached $580 million. The company promised to continue making discs for at least three years. While RCA once expected to sell 500,000 machines in the product's first year on the market, it sold only 550,000 since...
...RCA tried to promote its disc player as a low-cost alternative to tape machines, which was feasible three years ago, when VCRs typically sold for $1,000 and RCA's disc player went for $500. But prices for cassette recorders have fallen as low as $300. RCA dropped the price on the least expensive player to $199, but it was never able to take sales away from VCRs...
...second potential contender is Roy Disney, a look-alike nephew of Walt's. Disney controls about 2.7% of the firm's stock and is rumored to be gradually acquiring more. Others mentioned as possible buyers are Coca-Cola, RCA and Press Lord Rupert Murdoch. As a takeover subject, Disney will be no Bambi. Current management bitterly opposes a sellout. Last week Disney officers boosted their credit line from $400 million to $1.3 billion in order to fill the firm's war chest...