THE IBM CONNECTION
When MCA began to look for ways to present motion pictures for the home environment, they acquired Gauss ElectroPhysics and all their patents with the intent of developing, manufacturing and selling a consumer optical videodisc. MCA DiscoVision was formed from this acquisition and from the acquisition of several other companies as well. MCA Laboratories conducted R&D at the MCA DiscoVision headquarters in Torrance California, while MCA DiscoVision, as a software label, would supply programming by Universal and other companies. The 1973 press showing confirmed such intentions. Shortly thereafter, with Philips announcing a very similar optical videodisc system called VLP, MCA re-evaluated their position. Negotiations between MCA and N.V. Philips began to merge the two systems and in 1975, MCA announced the plans had changed. Philips would research, manufacture and sell players through its Magnavox brand name, and MCA DiscoVision would research videodisc mastering, replication and software distribution.
In 1977, MCA and Pioneer Electronics joined forces and created Universal Pioneer. Universal Pioneer would be responsible for the manufacture of discs for the Japanese market and would build the MCA designed DiscoVision player for the US industrial market. The 1978 launch of the MCA/Philips Optical Videodisc system adhered to the plan. The Magnavox VH-8000 player was handled by Philips, while programming was overseen by MCA Distribution and Spencer Gifts. Only two videodisc plants existed at the time as the Pioneer Kofu, Japan manufacturing facility was still under construction. The two existing plants, a small pilot and research facility in Torrence California, and a larger, mass duplication plant in Carson. had total responsibility for all disc mastering, research and duplication, including both consumer and industrial videodisc markets.
MCA quickly began to feel the strain of unduly optimistic replication costs and by only six months into the launch of the platform, DiscoVision was burning out. Production yields were terrible, replication costs and consumer returns were on their way through the roof. MCA needed a continuous flow of money to keep up manufacturing and research efforts. MCA was desperate and began looking for an outside source for help.
ENTER IBM
International Business Machines, one of the premiere manufacturers of industrial computer equipment had been
involved in several video and videodisc related projects throughout the 60's and 70's. On September 29, 1979,
MCA DiscoVision and IBM joined forces. MCA DiscoVision, as a company, ceased to exist and the new joint venture
was named Discovision Associates, Inc. Software would still be released on the MCA DiscoVision label, but to help
distinguish the new company, the capitol 'V' was dropped from the name. IBM took over all videodisc research and
manufacturing as well as research into videodisc applications for the industrial market. MCA supplied technical
knowledge and continued as a software supplier and distributor.
IBM was to have not only provided a new fresh outlook and objectivity to DiscoVision's woes, they were going to provide a large infusion of cash. These funds were destined to further research and development, and to overhaul the ailing Carson facility. Rather than this however, IBM felt a new corporate presence was required. Much of the funds were focused on a new Corporate facility in Costa Mesa, which included a very small limited run pressing facility for demonstration to potential customers.
The IBM/MCA marriage was not a smooth one as a result. Engineers in Carson grew frustrated as the focus of attention was shifted away from the real issues. While IBM did point out many areas where improvements could be made, and the Carson facility was generally cleaned up in terms of its environmental conditions, very little money was actually spent on the pressing lines. Struggles were further complicated by the animosity between IBM technicians and the existing DiscoVision employees.
Meanwhile, Universal/Pioneer finished the Kofu facility and had begun producing discs vastly superior to those being made in Carson. Seeing the success that Universal/Pioneer was having with the Kofu facility, it was the grand vision of corporate IBM to build a new, state-of-the art facility to take over the United States pressings of discs. With this new facility in operation, IBM could then completely renovate "Plant One". Something needed to be done as defects continued to run at an astronomical level. IBM, suffering from a stock fallout over the embarrassment of DiscoVision Associates, tried in vain to improve disc yields as stockholders voice serious concerns about the investment into optical video discs. Universal/Pioneer continued to produce high quality discs.
THE SHUTDOWN
With MCA funding exhausted and IBM unwilling to spend any more money, Discovision Associates grew more frustrated
by its inability to make videodiscs that worked. In late 1981, the deathblow was dealt as Discovision Associates
closed their doors. In an effort to keep the videodisc format from falling into oblivion, and to protect its own
investment, Pioneer shocked the industry buy buying out the 50% of Universal Pioneer controlled by Discovision
Associates. In addition, it purchased the Carson manufacturing facility and the defunct Torrence plant from
Discovision. Pioneer Electronics was now in complete control of the optical videodisc format and created Pioneer
Video to oversee the format. Philips pulled the Magnavision players less than a year later and only stayed in
the format by selling 2nd generation players built by Pioneer.
Discovision Associates, still exists today as a patent licensing company. In 1989, Pioneer purchased nearly all the Philips videodisc patents as well as over $100 million worth of videodisc patents held by Discovision Associates. Discovision still controls key optical patents, which apply to nearly all optical disc products, including Compact Disc, CD-Rom, video disc and DVD.
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