Mike Kotin is a knowledgeable consumer. Before buying a camcorder recently, the 34-year-old New York stockbroker read up on the subject. Then he went browsing in stores to check out all three formats in which portable video cameras are sold: older, bulkier full-size VHS, its more compact VHS-C cousin, and the 8mm version that fits in the palm of your hand. Kotin went for an 8mm, and size wasn't the only consideration. "The quality of 8mm is superior," he says.
Them's fightin' words in the contentious $3 billion camcorder market, where big Japanese companies such as Sony and Matsushita Electrical Industrial's Panasonic are jockeying to get consumers to buy their formats. The dukes are really flying this year, as the 8mm format pioneered by Sony Corp. has grabbed the lead, according to market researcher NPD Group Inc. in Port Washington, N. Y. (chart). That's sweet revenge for Sony, whose earlier Betamax video recorder format was knocked out of the market by Panasonic Co. and its VHS partners during the 1980s. This time, Sony has steadily built up market share since introducing the 8mm in 1985. Today, Sony says it moves about 40% of the camcorders sold in the U. S. and about 80% of all 8mm units.
Panasonic insists that VHS is still the dominant format. But it concedes that 8mm is making headway, so it is counterattacking with print and television ads urging potential camcorder owners to ask: "Will it play in my VCR?" The question is aimed at some 75 million households that have VHS-compatible video recorders.
Panasonic wants consumers to know that 8mm cassettes won't play in standard VCRs. Owners of VHS-C camcorders merely put cassettes into an adapter for their VCRs. By contrast, Sony-style 8mm models must be connected to a TV or VCR to play tapes -- unless the buyer owns a costly 8mm player. Many find this cumbersome. Gerald M. McCarthy, president of Zenith Sales Co., a division of Zenith Electronics Corp., which markets all three formats, says retailers handling his products are reporting "an inordinate number of returns by consumers" who bought 8mm camcorders believing they could be played in conventional VCRs. Sears, Roebuck & Co. says it has had returns but not a large number.
SLIMMER MARGINS. What's a body to do? Most buyers of small camcorders now find the inconveniences of 8mm offset by its benefits. Besides the handy compact size, standard 8mm tapes play up to two hours vs. 30 minutes for VHS-C. What's more, experts such as The Perfect Vision, a quarterly video magazine, say that 8mm is technically superior to VHS and VHS-C. Sony and other 8mm makers hope to further woo their adherents with cheaper 8mm VCRs and Video Walkmans on which to view their results. This has happened in Japan, where 8mm makes up 70% of the market. Production of full-size VHS camcorders was phased out in Japan last year.
Who will win the great camcorder war? The compact VHS-C units that Panasonic and its partners are pushing aren't out of the running. More dealers are carrying VHS-C as margins on 8mm have been pared by price cuts this year. Moreover, VHS-C models now are almost as light and small as their 8mm rivals. They're also about to improve: Panasonic is planning to introduce a new VHS-C line next spring.
Given all that, 1992 could be the make-or-break year in the camcorder dust-up. With the competition intensifying, the average price of both 8mm and VHS-C camcorders has been falling by as much as $10 per month. From 11% more expensive than old-fashioned VHS models last year, the new compact camcorders have dropped to almost the same price -- around $855, on average. So, whichever format wins the great camcorder war, consumers will get a better deal.