What Tech Can Still Learn From the VHS-Betamax Fight (VIDEO)

Jacob Harper  |

“What happened to Betamax?” Tech analysts have been asking that question since the early 80s, when Sony’s home-video machine first began to completely succumb to JVC competitor VHS.

On the surface, it just doesn’t make sense that Betamax lost, and lost spectacularly. But fail it did, and the reasons behind that colossal debacle still remain relevant as an important cautionary tale for the entire tech industry.

Betamax had the superior product. They were sturdier, had higher quality internal components, and had a much higher picture quality than VHS. And most importantly, it reasoned, they were first to market.

But the tech sector is not the healthcare sector, where being the pioneering product means everything in the world. In tech, “generics” like VHS that are just different enough are liable to hit the market almost immediately. And like generic drugs, they tend to be a heck of a lot cheaper.

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Pundits still argue the exact reasons why Betamax eventually got monopolized nearly out of existence by VHS. And they have been for quite some time. Back in 1989 LA Times writer James Flanagan argued that Betamax’ failure was a result of committing one of the seven deadly sins, writing that “Sony's real problem was not competition but overweening pride. Sony's renowned chairman and founder, Akio Morita, had decreed that Betamax could only sell under the Sony brand name and at a higher price than VHS – because it was higher quality. It may have been, but the public didn't care and didn't buy.”

But pride alone wasn’t necessarily the only culprit. As the Engineer Guy argues in this video examining the particulars of the products that comprised this early tech battle, a lot of VHS’ ultimate triumph had more with customer’s desire to buy products that simply get the job done. That is, customers flock to products that are not necessarily the absolute “best,” but are the absolute “good-enough.” 

The hot products in tech today are considerably more advanced than the ones in question in the VHS-Betamax battle. Instead of video-home recording providers battling, we have video-on-demand services duking it out for the consumer’s dollar.

However, the basic lessons culled from that early tech scuffle are the same. Getting your product out first certainly won’t hurt you. There’s still an edge to be gained from introducing an innovative new product before anyone else. Sony believed in this completely, and spent 20 years getting Betamax to market.

But if someone else can get your product basically right and cheaper to boot, you won’t be first for long. Just ask Atari – and just ask Sony.

(screengrab from YouTube video)


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