What REALLY happened to DuMont Labs?

[dtvmcdonald]

But all the big markets DID have at least 4 and in some cases
more VHF assignment.

[jr_tech]

Originally Posted by Retrovert

it wasn't the small upstarts of HP and Tek that ate its lunch and smashed its ricebowl.

Indeed! but it was perhaps a contributing factor, more akin to "taking DuMont's salad" starting in the late 40s.

"The profits from the oscillographs helped him invest in television design and his DuMont TV Network. Unfortunately the time spent on his TV ventures proved to be the end of his profitable oscillograph business. In 1947 a young equipment manufacturer called Tektronix produced the model 511 Time Base Trigger and Sweep Oscilloscope for $795. The use of time instead of frequency to measure a sweep across the CRT was Tektronix's big selling point. Time measurements are easier to interpret pulses and complex waveforms. It has been mentioned informally that Allen DuMont saw the model 511 demonstrated at an electronics show. He tried it and was impressed, but commented to Howard Vollum and Jack Murdock, co-founders of Tektronix that it was too expensive and they would be lucky to sell any. Tektronix's time base trigger and time sweep generator design would become the standard in the 1950s and into the 21st century. Tektronix would replace DuMont Oscillographs as the leading selling oscilloscope brand."

from: https://en.wikipedia.org/wiki/Allen_B._DuMont

Did DuMont actually fail to understand that he was looking at a "better mousetrap" that could demand a higher pricepoint... or was he perhaps just giving a couple of "upstarts" from the west a hard time?

jr

.

[Retrovert]

Originally Posted by dtvmcdonald

But all the big markets DID have at least 4 and in some cases more VHF assignment.

According to the sources below the VHF assignment problem killed DuMont, and very nearly killed ABC, which surived only because of a $30 cash infusion (about $600 million in today's money) in 1953 from merging with United Paramount Theaters (UPT) which allowed it to weather the ad drought until the VHF allocation freeze ended:

www.temple.edu/tempress/chapters_1400/1575_ch1.pdf
While several companies announced network plans after the war, the leaders were NBC, DuMont, CBS, and ABC. Through its policy of allocating TV stations from 1945 to 1952, the FCC ultimately determined which local and national firms would own valuable station licenses and which networks would prosper in the coming years. DuMont was not favored by the FCC. In fact, the commission’s allocation system severely hindered the DuMont network and prevented any other firm from starting a fourth network until the mid-1980s. The FCC allocated a different number of stations to each city. It then invited applications from companies that wanted to build and run these stations. Many of the first TV station operators were department stores, radio broadcasters, or newspaper publishers that were moving into television. Corporations like DuMont Laboratories that wanted to build a television network also applied for local TV station licenses. To ensure diversity of ownership, the FCC did not allow any company to own more than five station licenses. Except for these five stations per company, the FCC did not grant television stations directly to networks. As they went on the air through the late 1940s, stations filled airtime with a mixture of their own local shows and programs that were produced by the national television networks. DuMont, NBC, CBS, and ABC competed with each other to build a network of stations that would air its productions. A network’s survival depended on a strong affiliate line-up, since broadcasters had no means of distributing their programs from city to city without these affiliates. However, most cities were allocated fewer than four stations by the FCC. As a result, there were not enough stations in most markets for each of the four networks to have a “primary affiliate” that was likely to accept all of the programs that it offered. In Boston, for example, the four networks fought for time on only two stations.

jfredmacdonald.com/onutv/freeze.htm
The freeze years also allowed the networks, specifically NBC and CBS, to extend their dominance over national video. If network success lay in the ability to deliver large audiences, the talent pool and financial strength of NBC and CBS provided leverage absent at ABC and DuMont. In many markets, moreover, this leverage was magnified by the fact that TV was controlled by companies already operating NBC or CBS radio affiliates. And in small markets, where a single station might be affiliated with more than one network, NBC and CBS made wide use of coercive "option time" contracts, which gave them first rights to place their shows on the air ahead of ABC and DuMont programs offered at the same time. As Allen B. DuMont explained the situation, "the freeze reserved to two networks the almost exclusive right to broadcast in all but 12 of the 63 markets which had television service. It meant that the other two networks did not have...more than a ghost of an opportunity to get programs into the markets so necessary...[to] attract advertisers from whom revenues and profits must come.

Proof of DuMont's lamentation was in the statistics. Between 1949 and 1952 network billings for NBC and CBS rose from $9.9 million to $152.3 million, more than 84 percent of all network time sales. Figures for ABC and DuMont increased from $2.4 to $28.5 million. Were it not for a windfall of $30 million acquired through its merger with United Paramount Theaters (UPT) in 1953, ABC probably would not have survived the competition. Lacking a similar infusion of capital, however, the DuMont network continued to atrophy until it went out of business in 1955.

www.cato.org/pubs/pas/pa011.html
Property Rights In Radio Communication: The Key to the Reform of Telecommunications Regulation

The FCC's Network Inquiry demonstrated how the rigidity of allocation and assignment criteria limited competition to three major networks. A strong national network would require access to the top 50 markets, where most of the viewers, and therefore advertising revenues, were located. Under the FCC's 1952 TV allocation and assignment scheme, only seven of the top 50 markets received four or more VHF assignments. Twenty received 3 VHF assignments, 16 received two, and 2 markets received only 1. "As a consequence of this scheme, one network could reach 45 of the top fifty markets with VHF stations and the second could reach 43, while a third network could reach 27 and a fourth would have access to VHF stations in only 7 of the top fifty markets." The same FCC report documented how the DuMont network crumbled in the '50s as a consequence. FCC Network Inquiry Special Staff, "The Historical Evolution of the Commercial Network Broadcast System," October 1979, pp. 77-79.

[Retrovert]

Originally Posted by jr_tech

Did DuMont actually fail to understand that he was looking at a "better mousetrap" that could demand a higher pricepoint... or was he perhaps just giving a couple of "upstarts" from the west a hard time?

If you read the excerpt I posted from the book, DuMont sounds like such a straight shooter, as well as obsessed with the delights of technology, I suspect he truly believed that the unit couldn't sell at that price.

According to this:
www.syscompdesign.com/assets/Images/AppNotes/scope-history.pdf
The Dumont 224a was $150, and the 511 was $700, almost FIVE TIMES as much. That's about $4,500 vs $21,000 today. You can imagine what bean counters at a company would say about that kind of expense.

And then we have some numbers on Tektronix's sales:

History of Tektronix, Inc. – FundingUniverse
www.fundinguniverse.com/company-histories/tektronix-inc-history
By 1950, Tektronix was manufacturing its seventh generation of oscilloscopes, the model 517. Orders were backlogged six months to a year, and annual sales had exceeded $1 million.
...
In 1956 Tektronix passed Du Mont for leadership in the market.

Note that 1 million then was about $30 million today, still a relatively small number.

But by that point DuMont had been dismantled by Paramount.

Finally, that tradeshow story about the exchange between Vollum and DuMont is oral Tek legend:

www.vintagetek.org/wp-content/uploads/2012/01/Tek-History-Anon-RevB-small.pdf
Some years later Company legend has it that Howard Vollum was at a show with a $3000 instrument when W. B. Dumont walked up. The Dumont Company at the time was selling a product at a lower price level. Reportedly Dumont said to Howard, "that's a nice scope, son, but it will never sell at that price".

I can't find it anywhere else, and believe me, I looked.

So it is hard to say what really happened at that trade show. Since we don't know the full conversation, which might have been more interesting and more revealing of his state of mind, or how he said it, was it snarky or with some respect and regret, we can't really say. I can very well believe a fan of technology would say, in all seriousness, "wow, that's a nice piece of gear and I wish we could sell at that price point, too bad the market is fixated on low cost not features." So we just don't know.

[Tubejunke]

So in short, bad business moves hurt the great corporation and the great and over engineered sets targeted to the lesser population of "upper class" folks ended up being junk that was targeted more to the many "working class" folks, but it was too late.

The company was bought out and fizzled though the 60s from what I have seen and gather in reading. But I wonder why I saw DuMont sets in the 80s in dime stores. Is there any fragment at all of the company still out there?

[Tubejunke]

Originally Posted by Tubejunke

The company was bought out and fizzled though the 60s from what I have seen and gather in reading. But I wonder why I saw DuMont sets in the 80s in dime stores. Is there any fragment at all of the company still out there?

https://en.wikipedia.org/wiki/List_o...ork_broadcasts

[/QUOTE] The DuMont Television Network was launched in 1946 and ceased broadcasting in 1956. Allen DuMont, who created the network, preserved most of what it produced in kinescope format. By 1958, however, much of the library had been destroyed to recover the silver content. Most of whatever survived was loaded onto three trucks and dumped into Upper New York Bay in the mid-1970s.[2][3] Since then, there has been extensive research on which DuMont programs have episodes exist.

Due to the possibilities that various unknown collectors may be in possession of programs and/or episodes not listed here, and that the sources below may actually hold more than what is listed (for example, through a mislabeled film can), this list is very likely incomplete.

For a list of program series aired on DuMont, see List of programs broadcast by the DuMont Television Network. [/QUOTE]

[wa2ise]

Originally Posted by Tubejunke

So in short, bad business moves hurt the great corporation and the great and over engineered sets targeted to the lesser population of "upper class" folks ended up being junk that was targeted more to the many "working class" folks...

There aren't that many people in the "top 1%". And likely a good fraction of them will buy a "good enough" TV set, and not spend the extra money even though they could easily afford it. They'll probably buy the top end RCA but not the DuMont set. Might be that the rich folk won't watch that much TV anyway, instead going to the movies or plays. But still want a TV around to catch the news.

[Retrovert]

Originally Posted by Tubejunke

So in short, bad business moves hurt the great corporation and the great and over engineered sets targeted to the lesser population of "upper class" folks ended up being junk that was targeted more to the many "working class" folks, but it was too late.

Originally Posted by wa2ise

There aren't that many people in the "top 1%". And likely a good fraction of them will buy a "good enough" TV set, and not spend the extra money even though they could easily afford it. They'll probably buy the top end RCA but not the DuMont set.

Ahhhh, but you're both forgetting that only the middle class and upper class could afford a TV. It cost a pile of money, many thousands of dollars in today's inflated currency.

In 1953, an RCA CT-100, a 12" console, sold for $1,000. that's about $15,000 to $20,000 in today's money. A car cost about $1,500 by comparison, and the annual salary of a professional was $5,000. A factory worker made about $1,500 to $2,000.

The fancier televisions—RCA, Stromberg-Carlson, etc.—were sold to doctors, lawyers, engineers, and other professionals. The blue-collar factory workers bought the lower-priced second and third-tier lines, and the cost was still substantial. But since there wasn't a lot else to spend money on, and rent or a mortgage was far lower percentage of salary than today (about 1/3 of what it is today) it was an acceptable purchase.

[bgadow]

Originally Posted by Tubejunke

But I wonder why I saw DuMont sets in the 80s in dime stores. Is there any fragment at all of the company still out there?

All of the 1960's DuMont's were built by Emerson; they tended to have fancier cabinets and different control panels but underneath they were Emerson. After 1970 Emerson no longer built TV sets; for a time Admiral built the Emerson & DuMont branded stuff. At some point Emerson became just a marketing company; that's what they were when they sold all those cheap VCR's and TV sets at discount stores in the '80s. I don't know if they retained the DuMont name at that point or if they sold it to somebody else in the 70s. I lean toward the latter. I think the name might have ended up belonging to whoever owned the Capehart name as I've seen similar service manuals for both brands, for cheap stereos in the mid/late 70s.

[Steve McVoy]

There was a very active used TV market that allowed almost everyone to be able to afford a TV set by the mid 50s.

[Carmine]

Only a couple points to add...

1) That part about former regulators landing cushy jobs in the industries they regulated a just few years before is very true. I suspect in the 50s, it was more American company vs. American company. Once Zenith had ruined RCA's patent monopoly in the USA with the threat of a lawsuit, RCA simply moved onto licensing and tech-sharing agreements with Japanese companies. Zenith may have thought a legal remedy would work again, but it did not.

Trade policy is an executive-branch function, which means potentially every 4 years (but certainly every 8) many highly paid people (lawyers) in the Federal Trade Commission are looking for new jobs. Want a nice job working for Matsushita Electric Industrial Co. after Jimmy Carter loses his re-election? Be a good boy and foot-drag or ignore the evidence of television dumping in the USA. That's what ultimately killed Zenith and is now killing the US white-good industry, forcing consolidation, leaving Whirlpool like Zenith circa 1978... An giant in the industry, but with major storm clouds ahead.

http://www.whirlpoolcorp.com/facts/

2) I take all these inflation calculators with a grain of salt. Both my grandparents were mid-middle-class people (but not upper caste) who were very conservative about their spending. Factory jobs, kids, mortgage on a 3bdrm brick ranch, new-ish mid-price cars... But they had TV in the late 40s and by the early 60s, bought nothing but Zenith/Magnavox stuff. If TV really cut into their income as much has been claimed, they would have done without. In fact, they did without CoLoR until '68 (buying Magnavox and Zenith) at the same time. If a $600 tv was like a $10,000 item to me, I assure you they'd have done without.

[Retrovert]

Originally Posted by Carmine

2) I take all these inflation calculators with a grain of salt. Both my grandparents were mid-middle-class people (but not upper caste) who were very conservative about their spending. Factory jobs, kids, mortgage on a 3bdrm brick ranch, new-ish mid-price cars... But they had TV in the late 40s and by the early 60s, bought nothing but Zenith/Magnavox stuff. If TV really cut into their income as much has been claimed, they would have done without. In fact, they did without CoLoR until '68 (buying Magnavox and Zenith) at the same time. If a $600 tv was like a $10,000 item to me, I assure you they'd have done without.

It really was that expensive and simple math will proveit.

We know that a newly minted electrical engineering PhD in 1960 made about $5,000 at the time. (I've known EEs and scientists who made about that.) A skilled factory worker (car plant, say) made about $1,500 to $2,000.

So if recent graduate EE PhD makes $100,000 today, that's a factor of twenty over what they made in 1960. A skilled factory worker would make about $40,000, again, a factor of 20. Maybe even $50,000 a factor of 25.

Just simple math. The trick is to use salaries and labor costs, not goods, because we have low-cost items made by overseas slaves that depress the buying scale. How much did it cost to have a pair of shoes soled then vs. now? I can tell you that in the 1980s, it cost me $15 and now runs me $75, a factor of 5. How much was rent then vs. now? But when you compare the cost of a TV then vs now the numbers don't work because technology drops the price.

So the inflation factors are real. $600 in 1950 was like $12,000 today because if you make $2,000 per year in 1950 that $600 would be 1/3 of your income! It just has to be, as it was a percentage.

[Carmine]

I just did a quick Google of UAW wage, 1960 and came up with this:

http://www.detroityes.com/mb/showthr...e-wage-history

John Barnard in "American Vanguard": Measured in constant dollars, the 1947 average weekly wage in the industry of $56.51 had doubled by 1960 to $115.21, and tripled by 1970 to $170.07.

X 52=$5990

If you extrapolate Henry Ford's famous $5 per day wage (1914!) into 5 days a week x 52 (they actually worked 6 days back then) it equates to $1300 annually. That's 46-years removed from 1960.

Granted, these were probably the best industrial wages in the US, but hardly paying more than an EE PhD circa 1960. An average new car in 1960 was probably $2500, less than a year's wage. If today's average car is $30k, it's still well under a year's wages for the average autoworker.

[Smoky Pond]

I know that there's more to inflation than what the CPI calculators take into account, but $600 does represent about 10 months worth of mortgage payments for the average American in 1950.

[Retrovert]

Originally Posted by Carmine

I just did a quick Google of UAW wage, 1960 and came up with this:

http://www.detroityes.com/mb/showthr...e-wage-history

That isn't a good metric. Try this one, instead. It uses a basket of indicators (labor, housing, commodities, etc.) to form an accurate valuation:
http://www.measuringworth.com/uscomp...ativevalue.php

For example, using your example of a $600 TV price from 1950:

In 2014, the relative value of $600.00 from 1950 ranges from $4,730.00 to $34,800.00.

A simple Purchasing Power Calculator would say the relative value is $5,900.00. This answer is obtained by multiplying $600 by the percentage increase in the CPI from 1950 to 2014.

The further back in time one goes, the more obvious the inflation is:

Originally Posted by Carmine

If you extrapolate Henry Ford's famous $5 per day wage (1914!) into 5 days a week x 52 (they actually worked 6 days back then) it equates to $1300 annually. That's 46-years removed from 1960.

Errr, that isn't correct. Can't be. Again, using the above calculator:

In 2014, the relative value of $5.00 from 1914 ranges from $88.00 to $2,360.00.

My point about wages wasn't this:

Originally Posted by Carmine

Granted, these were probably the best industrial wages in the US, but hardly paying more than an EE PhD circa 1960. An average new car in 1960 was probably $2500, less than a year's wage. If today's average car is $30k, it's still well under a year's wages for the average autoworker.

But to compare the relative power of highly trained and educated people who bought the fancy TVs and HiFis of the 1950s and 1960s.

That was my point. We can easily extrapolate just back-of-the-envelope, and the better calculators show the severe devaluation of the currency, even if it does not yet rise to Weimar Republic levels.