Aftermath of VCRs: The Politicised End to a Continuing Story

After VHS had won the format dumping war and subsequent intervention, an aftershock threatened all parties. The Korean invasion of the European market, accompanied by illicit imports from Japan, threatened a deceptive peace. By supporting an anti-dumping action, the Japanese government and industry agreed with the actions against Koreans and apostate Japanese VCR producers, which due to internal European Community industry politics coincided with the television and microwave oven cases. Finally, these cases resulted in measures that gave European production some breathing space. Philips and Grundig used the results for the reconstruction of their VCR business and became number one in European production. Copying of an alien commercial policy, Original Equipment Manufacturers (OEM) supplies, bolstered the leading position. Opposite to an export OEM policy, the application of this copy in the domestic European market requires, in order to prevent defections, price discipline among customers not accepted by some competitors. Efforts to correct the situation by an anti-dumping case failed. The Korean transfer of production to the European Community and collapse of Thomson’s VCR sales, foreshadow of an expectable final breakdown of this company, caused the failure of the proceeding.