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Warner, Engstrom, Hillier, Webster, auths. (1985). RCA: A historical perspective, 1919-1984. RCA Corporation.

Reproduced for educational purposes only. Fair Use relied upon.

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historicalperspective

The history of R

CA

, from its

pioneering beginnings in wireless

comm

unications in 1919 to itsm

ultitude of technicalachievem

ents through 1984, isan inspiring story ofaccom

plishments and grow

thbrought about by the leadership,talents, and creative genius of itsm

any research, engineering,production, and adm

inistrativepeople. W

e are proud to recountthese events.

About the cover

1. A communications satellite underconstruction at RCA Astro-Electronicsfor RCA Americom.

2. Communications traffic andspacecraft tracking are monitored atRCA Americom's earth station in VernonValley, N.J.

3. The U.S. Navy's Combat SystemsEngineering Development site inMoorestown, N.J., where the AEGISweapon system is evaluated prior toproduction and where AEGIS CombatSystem crews are trained. AEGIS is thelargest single government program inRCA's history.

4. An employee inserts a silicon -intensified target (SIT) tube into asurveillance -type TV camera at the NewProducts Division, Lancaster, Pa.

5. In Somerville, NJ, an operator usesa plasma system to etch structures inintegrated circuit chips to dimensionsas small as 40 millionths of an inch.

6. RCA Laboratories researcher inspectsa color TV kinescope employing animproved electron -beam deflection yoke.

7. RCA's charged -coupled -device (CCD)color TV broadcast camera made itscommercial debut during NBC'scoverage of the 1984 World Series.

8. A layout designer uses a graphicscomputer system to design a complexintegrated -circuit chip.

For information about the title pageillustrations, refer to the captions onpages 4, 21, 24, 32, 45, 59, and 71.

CONTENTS

RCA A historical perspective

Part 1-The years to 1933By J.C. Warner

Branching from telecommunications, RCA quickly dipersfied into broadcasting,radio receivers, and phonographs-man nfacturing and merchandising many of itsown products.

14 Part 2-The years 1938-1958By E.W. EngstromRCA emerges from World War II as a major government contractor with a new rangeof skills. But television is the major development of this era for RCA.

Part 3-The years 1958-1962By E.W. EngstromThe boom in color television, along I, 1th a constant progression of new andelectronic products, ranging from microcircuits to space systems, characterized theseyears.

Part 4-The years 1962-1966By E.W.Engstromligoroas growth and an outward thrust took the company into such new areas ofbusiness as publishing, graphic arts, education, medical electronics, and car rentals.

Part 5-The years 1966-1971By J. HillierRCA met , nallenge of changing market conditions with a program ofdiversifi( (itton and emerged as a multinational company with worldwide industrialinvolvement.

Part 6-The years 1971-1976By J. HillierNo other period since the Great Depression affected RCA as severely as the recessionof 1974-1975. Despite this, the company emerged at the end of 1976 leaner, stronger,

and continuing to grow.

Part 7 --he years 1977-1984By William M. WebsterOf the many events that involved RCA in the challenging years 197711984, the mostcrucial was the watershed decision made in 1981 by top management to focus onthose business areas offering the greatest potential for growth-electronics,communications, and entertainment.

1

Copyright @1985 RCA Corporation.Certain portions of this work are copyright @1982, 1978, 1967, 1963,1958, and 1957 by RCA Corporation.

Printed in the U.S.A.

Published by the RCA Technical Excellence Center,13 Roszel Road, P.O. Box 432, Princeton, NJ 08540-0432.

The first five articles of this collection were previously published inRCA Engineer magazine. The texts of these articles and of Part 6have not been revised since the time of their original printing.Consequently, they contain organization and product names in use atpublication times.

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AUTHORS

About the authors

John Chester Warner, the author of thefirst article, was an intimate part of thescene he describes. Through the 1920s,Warner had been associated closely withreceiving tube research at the GeneralElectric Company in Schenectady. In1932, following the separation of RCAfrom the General Electric andWestinghouse Companies, he wasappointed Manager of Research andDevelopment at the RCA RadiotronCompany in Harrison, NJ. He was namedVice President of Radiotron in 1934, ayear before the organization became theRadiotron Division of the new RCAManufacturing Company. In the sameyear in which the article was written hemet a tragic and untimely death in anautomobile accident at the age of 42.

The author of the following threearticles, Parts 2-4, was uniquely qualifiedto chronicle the further development ofRCA. Before his retirement in 1969 aftermore than 45 years as an RCA employee,Dr. Elmer William Engstrom heldseveral important executive assignments,and directed most of RCA's principalresearch and engineering programsthrough three decades to the early 1960s.

During the 1930s, Dr. Engstromdirected the research and developmentprogram that transformed television froma series of experiments into a practicalservice. In 1942, he became Director ofGeneral Research and subsequentlyDirector of Research at the newly

organized RCA Laboratories in Princeton,NJ. Elevated to a vice presidency in1945, he entered upon a series ofincreasingly responsible executiveassignments extending to all of thetechnical activities of the Corporation. Hebecame successively, Executive VicePresident, Research and Engineering, andSenior Executive Vice President of RCA.On December 1, 1961, Dr. Engstrom wasnamed President of RCA, serving untilJanuary 1, 1966, when he was appointedChairman of the Executive Committee ofthe Board until his retirement.

Dr. James Hillier, author of Parts 5and 6, was likewise an intimate part ofthe scene he describes. As ExecutiveVice President, Research andEngineering, he was responsible forresearch and development throughout theCorporation. He first came intoprominence for his contributions to thedevelopment of the electron microscopeand for his subsequent role inencouraging the growth of electronmicroscopy as a research technique.

Dr. Hillier joined RCA as a researchphysicist in 1940. In 1957 he wasappointed General Manager of RCALaboratories and a year later was electedVice President. He was named VicePresident, RCA Research and Engineering

in 1968 and in 1969 was appointedExecutive Vice President, Research andEngineering. From 1976 until hisretirement in September 1977 he wasVice President and Senior Scientist.

As Vice President, RCA Laboratories,Dr. William M. Webster, author of themost recent article, is responsible fordirecting RCA's central researchorganization in Princeton, NJ., and inZurich, Switzerland, as well as forresearch and development in satellitelaboratories in product divisions.

A leader in the field of solid statephysics, Dr. Webster joined RCALaboratories in 1946 and made numerouscontributions to tube and transistordevelopments. From 1954 to 1959, he wasManager of Advanced Development forthe RCA Semiconductor and MaterialsDivision. He returned to RCALaboratories as Director of the ElectronicResearch Laboratory in 1959. He wasappointed Staff Vice President, Materialsand Device Research, in 1966, and hasbeen in charge of RCA Laboratories since1968. He was elected to his presentposition of Corporate Vice President in1969.

3

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1. RCA Radio Central lowers at Rocky Point,Long Island in the early 1920s.

2. Alexanderson high-speed alternators likethese at RCA's Rocky Point transmittingstation once carried the entire load ofoverseas radio traffic.

3. Copy of first commercial wireless servicemessage between the United States andEngland.

Part 1 The years to 1938

J.C.Warner

Branching out from telecommunications, RCA quicklydiversified into broadcasting, radio re:3eivers, andphonographs-manufacturing and merchandising manyof its own products.

It would be misleading for me to implythat anything approaching a complete his-tory of the Radio Corporation of Americacould be covered in the brief time whichwe can spend together. While the com-pany is only a little over 18 years old, sev-eral volumes would be required to do areally thorough job. However, I shall try toreview some of the high points in the his-tory of the company, and to cite the pro-gressive changes in organization and theirrelation to the progress of the company inradio and allied fields.

It has often been said that "the story ofthe Radio Corporation of America outlinesthe larger story of the radio era," i.e. theera of radio broadcasting. Peculiarly enoughthe company was not organized with radiobroadcasting in mind, although it is sig-nificant that the man whose name is soclosely associated with the history of RCAand who has for many years been its activehead, had clearly visualized the possibili-ties of radio broadcasting service and even"electric tuning" long before broadcastingmade its first appearance. I refer, of course.to Mr. David Sarnoff.

Radio-a new communications service

At the close of the war the only companyin a position to handle commercial trans-atlantic radio communications was the Mar-coni Wireless Telegraph Company of Amer-ica, although the stations which it hadoperated before the war were in the handsof the Government who had taken over allsuch stations for wartime purposes. Thiscompany was an offshoot of the BritishMarconi Co. and was largely owned byEnglish interests.

At this time the best known means oflong-distance transmission was the Alex-anderson high -frequency alternator, the pa-

tents on which were owned by the GeneralElectric Company. Negotiations betweenGeneral Electric and the American Mar-coni Company, which had started severalyears previous, but had been interruptedby the war, were resumed in 1919 for thepurpose of transferring patent rights aswell as alternators to the Marconi Com-pany which was anxious to expand itstransatlantic services.

Certain high officials of the Governmentlearned of these negotiations and wereunwilling to see a growing communica-tions service under foreign control, par-ticularly since the transatlantic cables werein the hands of foreign, though friendly,nations. Consequently they suggested tothe General Electric Company that nego-tiations be suspended until after discus-sion with the Navy Department. This wasin April 1919 and it is interesting to notethat the letter to the General ElectricCompany was written by Mr. Franklin D.Roosevelt, then Acting Secretary of theNavy.

Formation of RCA

As a result of conferences with the Navy aplan was developed for forming a newAmerican company to take over the assetsof the American Marconi Company. So, onOctober 17, 1919, the Radio Corporation ofAmerica was incorporated, and on Novem-ber 20, 1919 the entire business of theMarconi Company was taken over.

GE held a substantial interest in thenew company, and immediate arrangementswere made between RCA and GE to cross -license each other to use the radio pat-ents of the GE Company and the patentsRCA had just acquired from Marconi. Workwas started at once on new high -poweralternator stations in California, Mass-achusetts and Hawaii.

But another patent deadlock soon ap-

5

1919-1938

peared particularly with respect to vacuumtubes. The possibilities of long-distanceshortwave communications were unknownat this time. In fact, wavelengths under200 meters were relegated to the sup-posedly unimportant use of amateurs. But,tube transmitters were needed for medi-um -power services and, of course, tubereceivers were essential.

Strong patents on vacuum tubes wereheld by both GE and the Western ElectricCompany, but neither could make effec-tive use of its own patents without in-fringement of the other's. Again the Navylent a hand and persuaded the GE Com-pany and AT&T Company to come to anunderstanding "for the good of the pub-lic." This was in January 1920.

Transoceanic service begins

In February 1920, the stations which hadbeen taken over from the Marconi Com-pany by the Government during the warwere turned back to the new RCA, and aforeign communications service was inaugu-rated. One of the principal stations was inNew Brunswick, NJ., and the longwaveantenna there has no doubt been seen bya great many of you. During that year, for-eign service was established with England,Germany, France, Norway, Japan, andHawaii.

In July 1920 an agreement was reachedbetween RCA, GE, and AT&T which per-mitted RCA to proceed with the use of allradio patents of these companies.

Beginning of broadcasting

During the first year of RCA, attention wasdirected almost exclusively on communi-4

cations, but in 1921, the first rumblings ofwhat soon was to become a broadcastingboom began to be heard. A number ofexperimenters had been playing with theidea of transmitting phonograph music oversomewhat crude telephone transmitters.

Westinghouse joins radio group

Westinghouse had done a certain amountof radio experimentation in its laborato-ries, and shortly after the formation ofRCA, began to consider going into theradio field. A subsidiary company was setup known as The International Radio Tele-graph Company which had acquired a largegroup of Fessenden patents from the oldNational Electric Signaling Company. Con-sideration was given to going into thecommunications business, but difficultieswere encountered in that the importantEuropean stations were all tied in withthe stations of the Marconi Co. now heldby RCA.

To strengthen their position Westing-house acquired a group of Armstrong andPupin patents, among which was the Arm-strong "feedback" patent later to becomequite famous. Finally, in 1921, a cross -li-cense agreement was made between RCA,GE and Westinghouse, and Westinghousenow became a member of the radio group.

Broadcasting begins

Meanwhile, strenuous efforts were beingmade to get broadcasting started. Thepioneer licensed station of the UnitedStates, and of the world, was KDKA, ofthe Westinghouse Company, in Pittsburgh,licensed by the Department of Commerce

4. In 1919, the first RCA laboratory wasstarted in this tent, at Rocky Point.

5. Radio Station WJZ in Newark, N.J.,which first went on the air in 1921 withWorld Series bulletins. To subdue echoes,walls were draped in red cloth, and the floorwas covered with an oriental rug to quietfootsteps.

5

1919-1938

6. On July 6, 1924, RCA transmitted thefirst radio photo (of Charles Evans Hughes)across the Atlantic.

7. Jack Dempsey listens to a Radio MusicBox just before the Dempsey-Carpentierchampionship title fight in 1921.

8. Chief Officer Elmer Pickerill of the U.S.S.Leviathan stands by the array of 1926 wire-less equipment which permitted the vessel tokeep in radio contact with both shores dur-ing transoceanic crossings.

on October 27, 1920. This station broad-cast election returns in November of thatyear. RCA first entered this field on July2, 1921, when a one -day broadcast wasmade from a temporary station at Hobo-ken, NJ., on the occasion of the Demp-sey-Carpentier fight. Soon after, RCAopened station WDY at Roselle Park, NJ.,which continued for some months, whenit was shut down on account of interfer-ence with station WIZ of the Westing-house Company in nearby Newark. RCAthen went in as half -partner with West-inghouse in the management of WIZ. Broad-casting was really on it,. way.

Wireless Specialty Company

Another corporate element entered thepicture in 1921, the Wireless SpecialtyApparatus Company. This was a Massa-chusetts concern largely occupied in mak-ing apparatus for the Tropical Radio Com-pany, which in turn was a subsidiary ofthe United Fruit Company, and which oper-ated coast and ship service for the largeUnited Fruit fleet. GE bought into Wire-less Specialty, and again made licensearrangements which cleared up a few moreof the patent obstacles to RCA's progress.

A formative period

These first two yeas cover what might becalled the formative period of RCA. It was

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a period during which all of the importantAmerican companies which could play apart in the development of the radio fieldof that time were brought into a workablerelationship.

It was a fortunate coincidence that theend of this two-year period came just atthe threshold of the development of thenew broadcasting industry. In fact it is afair statement that without the removal ofthe many previous obstacles, broadcastingitself would never have developed on anational scale in such a short time.

RCA enters merchandising field

Just prior to the start of broadcasting RCAhad given thought to furnishing apparatusto radio amateurs both for reception andtransmission. As broadcasting appeared,the line of amateur apparatus was expand-ed as quickly as possible to include homebroadcast receiving equipment, and RCAnow entered the merchandising field withGE and Westinghouse as manufactures(Wireless Specialty also furnished a smallamount of apparatus for a time). As laterdeveloped, this arrangement had manydisadvantages but remember that at thetime it was probably the only way in whichthe RCA could get started. It was, so tospeak, a condition of RCA's birth.

In 1922, RCA got out a catalogue ofradio equipment which well illustrates theconditions of that day in comparison withthe present. For that reason I shall digressfor a few moments to describe some of thethings which were offered for sale. Thecatalogue was entitled "Radio Enters theHome," and since in this period every manhad to he his own serviceman all the

8

1919-1938

accessories imaginable were included aswell as many parts for the experimenterto make his own set.

The cheapest receiver listed was a steelbox containing a single -circuit tuner andcrystal. This sold for $25.50 with head-phones, antenna equipment and "full in-structions." More elaborate crystal setswere available at $32.50 and $47.50. Thecheapest tube set was the one -tube "Aeri-ola Senior" made by Westinghouse-it useda WD -11 tube in a regenerative circuit andsold for $75.90 with batteries and antenna,and for $65.00 without the accessories.This was a very popular set in its day andit is quite likely that a few of them arestill in use.

GE supplied a set made in steel boxes.The two units comprised a tuning systemin one box and a three -tube detector -am-plifier in the other box, and sold completefor $250.00. Westinghouse supplied a some-what similar receiver in a wooden box at$261.75. This also comprised two elements,one of which was a single circuit tuner,the other a detector -amplifier.

The most elaborate set was the "Aeri-ola Grand" made by Westinghouse. Thishad four tubes, a regenerative detectorand, in addition, there were four ballasttubes to avoid use of a filament rheostat.No emphasis was placed on the number oftubes since the practice of stressing thishad not yet appeared. This set sold for$401 with all accessories.

The only loudspeaker shown was sim-ilar to a brass automobile horn with a tele-phone receiver on the end-which sold

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for $30.00. It is interesting to note that aphonograph attachment was available at$18.00 which consisted of a telephone re-ceiver element to be attached to the tonearm of the phonograph so as to get theequivalent of a loudspeaker. There weretwo models-one for Victrolas and theother for Graphanolas.

First radio tubes

At this time RCA sold four types of receiv-ing tubes. Two were made by Westing-house and two by GE. The Westinghousetubes were designed and manufactured inEast Pittsburgh and the GE tubes weredesigned in their Research Laboratory atSchenectady and manufactured in two ofthe GE lamp factories, one at Nela Park,Cleveland, and the other in the EdisonLamp Works at Harrison, the same plantwhich is now the Radiotron Works of ourown company.

Tubes were also sold by E.T. Cunning-ham, Inc., first on the West Coast, andlater throughout the country. Mr. Cunning-ham for some years had been making tubesfor amateurs on the West Coast, and see-ing the possibilities of merchandising tubeson a large scale he entered into an ar-rangement with RCA in 1920 which gavehim the right to sell tubes under his ownname. They were the same as RCA tubesbut had different type numbers.

RCA progresses in all fields

The years 1923, 1924, and 1925 broughtnumerous advances in the RCA fields. To

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8

1919-1938

9. RCA's first broadcasting studio in 1921.Station WDY, Roselle ParkV.J. discontinuedservice after some months because ofinterference with nearby WJZ, Newark, N.J.Subsequently, RCA became half owner of WJZwith Westinghouse.

10. Engineers setting up for RCA's first dayin radio broadcasting. The occasion was theDempsey-Carpentier fight on July 2. 1921.

11. RCA's first catalog of home broadcastreceivers offered the Aeriola Senior. Thissingle -vacuum -tube set u'as very popular inits day.

12. One of America's first remotebroadcasts, from an improvised studio at theNew York Electrical Show in the 71stRegiment Armory, New York City, October1921. Standing at the center behind thewooden -horn microphone is Major J. AndrewWhite, Program Manager of RCA's first radiostation, WDY, Roselle Park, NJ.

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mention only a few-in 1923 two broad-casting stations were opened by RCA inNew York and one in Washington. In 1925the first WIZ transmitter was installed atBound Brook, NJ. Short -waves came intouse for long-distance communications, firstto supplement the high -power long -wavetransmitters, and later to take over prac-tically all of the long-distance service.

Transoceanic communications were ex-tended to additional European and SouthAmerican countries. The first superheter-odyne receiver was brought out in 1924. In1925 a receiver was sold with accessoriespermitting it to he operated from alternat-ing current. In the same year the electro-dynamic loudspeaker was brought out. Ap-paratus was developed for recording andreproducing records electrically. Improve-ments were made in tubes greatly reduc-ing the power consumption.

In 1925, RCA furnished certain compo-nents to the Victor Talking Machine Com-pany which were built into a radio -phono-graph combination employing a singlespeaker. This is significant as the firststep in very important later developments.

RCA only a selling agency

Remember, that during this period and forseveral years after, in the merchandisingfield RCA itself was only a selling agency.The manufacturing was done entirely bythe electronic companies. Receivers weremade at Schenectady by GE and at EastPittsburgh by Westinghouse. Receivingtubes were engineered at East Pittsburghand Schenectady, and were made in GElamp factories at Cleveland, Harrison, and

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later at Newark-also in Westinghouse fac-tories, at East Pittsburgh, Bloomfield, NJ.,and later at Indianapolis (in what is nowour Indianapolis Plant).

It must already he evident that theproblems of coordination began to be tre-mendous. RCA first utilized the electricallaboratory of the City College of New York,which was in charge of Dr. Alfred N. Gold-smith, to test new models of apparatus.This was quickly outgrown and the Tech-nical and Test Department of RCA wasestablished in its own building at theedge of Van Cortlandt Park in New York.Here samples of apparatus were submit-ted independently by GE and Westinghouse,tested and reported hack to the manufac-turing companies, with approval or sug-gested changes.

It soon became necessary for RCA tohave the same apparatus regardless ofwhich company made it. In the case oftubes it was particularly essential to haveuniform designs from all factories so theycould be interchangeable in any receiver.Of course, this was long before the timetubes were shipped in sets.

Efforts on coordination

In an attempt to accomplish this neces-sary coordination, "design" or "standardi-zation" committees were set up separatelyfor receivers and tubes, comprising repre-sentatives of GE and Westinghouse. Thetube committee which started in 1924 per-haps best serves to illustrate the unwield-iness of such an arrangement, which I willdescribe in some detail.

This committee was known as the Radio -

1919-1938

tron Standardization Committee. It wasmade up of representatives from East Pitts-burgh, Cleveland, Schenectady, Bloomfield,and Harrison-two and sometimes threefrom each. It met once a month aroundthe circle and attempted to arrive at agree-ments on tube designs, ratings, character-istics, and even some production problems.It had no direct representation from thereceiver divisions so the coordination withthem was supposedly handled by the EastPittsburgh and Schenectady tube repre-sentatives, and the ideas and needs of thereceiver engineers carried to the tube meet-ings. The main committee carried with ita train of subcommittees and coordinationgroups intended to handle specific tech-nical items. Needless to say this kind ofan arrangement was in many ways unsa-tisfactory, yet it is difficult to visualizeany better method under the then exist-ing company relationships.

The design committee on receivers oper-ated in much the same way as the tubecommittee, but with some advantage inhaving only two groups involved. It finallybecame necessary to set up an additionalreceiver coordination committee which in-cluded RCA representation. One of theirfirst subjects of discussion in 1927 wasthe "Radiola 16," and another model whichbecame the "Radiola 17," which was thefirst real ac receiver using ac tubes.

The loss of time inherent in the inter-company committee method of coordina-tion was a major handicap to progress inengineering, manufacturing, and sales, butit remained until new major changes inorganization came to pass, as we shall seelater.

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Formation of theNational Broadcasting CompanyGoing back to 1924, the AT&T was activelydeveloping the use of wire lines for fur-nishing programs to broadcast stations andthey set up WEAF as the source of theseprograms. In 1926 RCA and its associatestook steps to integrate a complete broad-casting service and formed the NationalBroadcasting Company. This was a recog-nition by RCA officials that this new ser-vice had the possibilities of an importantindustry and that a specialized organiza-tion was necessary to develop programs,to install new stations and to maintain asatisfactory continuous service to their ownas well as other stations.

The new company acquired station WEAFfrom the AT&T, and also took over thestations owned by RCA and thereby createdthe real beginning of the network broad-casting industry.

RCA licenses otherradio companiesIn 1927, a major step was taken in a new

direction, the licensing of other manufac-turers under RCA patents. It was inevit-able that the demand for broadcast re-ceivers would lead other companies intothe business, and a large number had bythis time become established. The grant-ing of licenses to these companies strength-ened their position, but at the same timegave RCA a rightful return for its hugeinvestment in patents obtained throughthe research and engineering of the radiogroup and also by purchases from otherinventors.

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1919-1938

13. Portable field pick-up amplifiers alstation WEAF in New York in 1922.

14. Top left, first model of 3 -element DeForestaudion. Top right, one version of the two -element Fleming valve, forerunner of allvacuum tubes. Bottom left, first tube tooperate direct from an alternating currentsource. Bottom right, an all -metal tube whichcontains its vacuum within an ironenvelope.

15. The Radiola II, an early radio marketedby RCA at the start of the 1920s. The word"Radiola" was coined by Dr. A.N. Goldsmithin a note to General Sarnoff supporting hisconcept of a "Radio Music Box" for homeentertainment

16. The Radiola 17, the first ac -poweredradio, contained six tubes plus a rectifier.

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At first the superheterodyne patents werenot included in the licenses. Also it wasnot until two years later that tube licenseswere granted, although a number of lampand other manufactures were actively mak-ing tubes.

Radiomarine company formed

Late in 1927, the ship -to -shore telegraphbusiness of the RCA, which had been grow-ing steadily, was segregated into a newsubsidiary company-the Radiomarine Cor-poration of America.

RCA Photophone organized

In 1928 a new offshoot of the radio busi-ness appeared. For several yeas work hadbeen going on in the GE laboratories toperfect a system of recording sound onfilm. This was now ready for commercialexploitation in the motion picture indus-try and RCA Photophone Company wasorganized to handle this business.

RCA purchases Victor Company

1929 was a year of far-reaching changes inthe organization of the RCA group whichconstituted the first major step towardsintegration of the company into a self-con-tained, self-controlled radio business.

I have mentioned already some of thehandicaps inherent in the arrangementswhereby RCA did the selling while theother companies manufactured. This meth-od was wholly inadequate to meet thequick moves of the independent competi-tor. Furthermore, the electric companies

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naturally wanted to make a profit and sodid RCA. This seriously handicapped thecoordination of sales and production, whichis so essential to the success of an entireoperation. RCA needed its own manufac-turing facilities.

The Victor Talking Machine Companyat Camden had been seriously affected bythe growth of radio and had not been par-ticularly successful in its attempts to enterthe radio field. In order to obtain manu-facturing facilities RCA purchased the Vic-tor Company including the manufacturingplant, what was left of the phonographbusiness, and the Victor dog trademark.Arrangements were also made whereby RCAtook over tube manufacturing from GEand Westinghouse. RCA acquired the entireEdison Lamp Works property of the GE atHarrison, and also the Westinghouse fac-tory at Indianapolis, and at the end of theyear the RCA Victor Company and theRCA Radiotron Company were organized.

RCA Communications formed

In this same year the RCA Communica-tions Company was formed to take over allof the business in transoceanic communi-cations.

Consolidated research, engineering,manufacturing and sales

In 1930 RCA completed the consolidationin the RCA Victor and Radiotron compan-ies of all facilities of research, engineer-ing, manufacturing, and sales of RCA prod-ucts which now for the first time includedphonographs and records. Somewhat later,

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1919-1938 Iin 1932, the Photophone business also wastaken over the by the RCA Victor Company.

Licenses were now being granted totube manufacturers and the superhetero-dyne patents were included in the setlicenses. Agreements had also been madewith a number of foreign radio manufac-turers giving RCA rights under their pat-ents and in some cases access to theirlaboratories.

Cunningham Company boughtIn 1931 the E.T. Cunningham Companywas taken over by RCA and consolidatedwith the RCA Radiotron Company, givingRCA rights to the use of the Cunninghambrand and bringing Mr. Cunningham intothe RCA organization.

Electric companies withdraw

The second and final step toward an inde-pendent RCA took place in 1932. In 1930the Government had brought suit againstRCA attacking certain exclusive featuresof the inter -company agreements, and asthe result of a consent decree all thestock interest of GE and Westinghouse inRCA was disposed of by those companies.AT&T had disposed of its stock interest inRCA some years before. Modified cross -li-cense patent agreements were entered intowith the approval of the Attorney Generaland the sanction of the court. RCA nowbecame a completely self-contained organ-ization with wholly owned subsidiary com-panies operating a broadcasting business,a communications business, a marine radiobusiness, a radio school, and a manufac-turing and merchandising business.

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DeForest Company purchased

In 1934 the tube business was augmentedby the purchase of certain patents fromthe defunct DeForest Radio Company. Thisbrought about the beginning of transmit-ting tube manufacturing by RCA Radiotron.

RCA Victorand RCA Radiotron merge

In 1935, the manufacturing and merchan-dising business was further consolidatedby the merger of the RCA Radiotron andRCA Victor Companies which now becamethe RCA Manufacturing Co.

Importance of diversification

Before concluding I want to emphasizeone phase of the history of RCA which sofar I have mentioned only indirectly, yetwhich stands out with clearness and sig-nificance in the whole course of the 18years of RCA's life. I refer to productdiversification. A study of the history ofRCA is well worthwhile if it does no morethan demonstrate the value of diversifica-tion, and its paramount importance towardthe future.

The corporate history is a sort of familytree in which certain elements contrib-uted at the start, but which were laterseparated from the new growth. I shalluse another horticultural analogy to illus-trate product diversification.

Certain varieties of trees are responsiveto wide differences of training. Two plantsmay sprout from the ground exactly alike,side by side. One of them may be trainedto grow perfectly straight with a central

12

1919-1938

17. Victrola plate used on phonographs; ca.1925.

18. The 1923 Radiola III.

19. Laboratory research work in Camden inthe mid -30s. Left to right: Clarence A.Gunther testing receivers; Dr. Elmer W. Eng-strom working on a radio receiver; John B.Coleman inspecting a transmitter.

19

trunk and beautiful symmetry. The othermay be trained into a large bush -likegrowth with many branches.

Two companies may also start in thesame way from small beginnings. One maybe concerned with a single product or anarrow field while the other grows manybranches, large and small. We may have agreat admiration for the tall straight tree,but if a storm comes along and breaks offthe top it may be years before it recoversits original form. The same storm has lit-tle effect on the other tree. It may passover without harm or even if a few branchesare broken they may be trimmed off with-out showing.

The one -product company may do admir-ably in times of prosperity and we mayenvy its simple operation. But if it meetswith changing conditions or times of depres-sion the "one product" may no longer bein demand and the company has nowhereto turn.

Suppose that back in 1921 RCA hadsaid "No, we aren't interested in radioentertainment, we are in the commercialcommunications business." Again supposeRCA had looked at talking pictures andsaid "No, we aren't interested, we are inthe radio business." Again, after acquiringthe Victor Company suppose RCA Victorhad said "We will let the phonograph bus-iness die. It doesn't amount to much andwe want to sell radio receivers." There areseveral obvious answers to these supposi-tions, but the uppermost in our mindsprobably is that if these things had hap-pened most of us would not have our jobs.

Public service is paramount

The strength of a company is in a largemeasure proportional to its service to thepublic. The RCA has grown as it has ex-

tended its fields of public service. It willcontinue to grow just so long as it utilizesits variety of resources to give the publicnew or better services, or new or betterproducts.

It should never be forgotten that a by-product often becomes a main product.Again, the limitations of a product or ser-vice today may turn into advantages oftomorrow. The often alleged lack of secrecyin radio communication was once talkedof as a handicap, but broad,- isting, as itsname implies, made good use of this socalled handicap.

Research insures progressResearch has played a major part in theevolution of the RCA and must continueto do so. I use the term not alone in atechnical sense but broadly-research insales methods, in advertising, in relationswith the public, in better understandingand organization of our personnel, as wellas in engineering and manufacturing ofour products.

Research provides the new food whichthe tree needs when the old is exhaustedor no longer suitable. The tree must growor it will die and a company must goahead or back. It never stands still. RCAhas made good use of its resources toexpand its fields of activity. But it is asafe prediction that if we live up to ouropportunities we will some day look backat 1938 and see that we have now onlystarted to scratch the surface. Facsimileis barely started. Television is still aheadof us. Commercial sound applications aregetting under way. A multitude of ultra-high frequency applications are certain.And outside the radio or entertainmentfields the field of electronic devices is inits early infancy.

I hope that this brief story of the RCAhas served to show something of how farwe have come but more important, howmuch farther we can go in the future.

2

14

3

.. -

1. RCA developed tricolor picture tubes. Leftto right: E.W. Herold; Dr. E.W. Engstrom; Dr.H.R. Lac; Dr. V.K. Zworykin.

2. RCA tr receiver production line inCamden; ca. 1946.

3. Studio/field black -and -white by camerawith 3 -inch orthicon pick-up tube, usedduring and immediately after Wiwld War 11.

Part 2 The years 1938-1958

E.W.Engstrom

RCA emerges from World War ll as a major Governmentcontractor with a new range of skills. But television is the majordevelopment of this era for RCA.

1s a historian writing in 1938, the late.1.C. Warner, then Vice President, Radio-tron Division, of the RCA ManufacturingCompany, undertook to review the first 18years of RCA's corporate life. His conclud-ing words at the time were: "if we live upto our opportunities we will some day lookhack to 1938 and see that we have onlystarted to scratch the surface."

None of us associated with Warner in1938 would have disagreed with this esti-mate. At the same time, it is doubtful thatanyone could have foreseen the phenom-enal growth that has marked the second18 years of RCA's existence. From a $100million corporation in 1938, RCA soared tothe billion dollar corporate rank in 1955, aposition it maintained in 1956 and 1957.In 18 years, its plant and equipment mul-tiplied six times in value and the totalnumber of employees quadrupled, to some80,000 persons.

More significant than this impressivegrowth was the basic change in the natureof the Corporation itself. In /938, RCA wasin transition from a radio communicationsconcern to a broadly diversified electron-ics organization with a growing interest insuch new fields as radar, television, andairborne electronics. Today it has becomean outstanding research, engineering andmanufacturing enterprise, holding a posi-tion of leadership. The second 18 years ofRCA not only have lived up to the oppor-tunities which Warner referred to in 1938but have created a host of new and excit-ing opportunities for the future.

Shortly after Warner had published hisreview, two events occurred which were toto influence profoundly the future of theCorporation. In April, 1939, seven years ofintensive research, engineering develop-ment and field testing by RCA culminatedin the introduction, at the New York

World's Fair, of the first public televisionservice. Four months later, Hitler's assaulton Poland and the declarations of war byEngland and France opened the SecondWorld War.

The official inauguration of televisionservice was the harbinger of a new era inmass communications, but it required akeen eye to see in the actual event theshape of the nationwide television servicewe know today. It was an extremely limitedservice, covering only the New York met-ropolitan area, and operating on the "ex-perimental" basis authorized by the Fed-eral Communications Commission. Pro-grams emanating from the NBC transmitteratop the Empire State Building were viewedon a relative handful of 9 -inch direct viewand 12 -inch reflection -type receivers pro-duced at Camden for sale in the New Yorkarea.

Standing before the Iconoscope cam-eras in front of the RCA Building at theWorld's Fair on April 20, David Sarnoffannounced the beginning of regular tele-vision service by NBC. And he added:

"Now we add sight to sound. It is witha feeling of humbleness that I come tothis moment of announcing the birthin this country of a new art so impor-tant in its implications that it is boundto affect all society.... This miracle ofengineering skill which one day willbring the world to the home, also bringsa new American industry to serve man'smaterial welfare...."

RCA in war

The outbreak of World War II effectivelyhalted the further progress of commercialtelevision. The clear need for military pre-paredness led to increasingly heavy de-mands through 1940 and 1941 on indus-

15

1938-1958

trial research, engineering and productionfacilities both for American forces at homeand for Britain and France through theLend Lease program. RCA, with long expe-rience in communications and with a pre-war record of major contributions in theimportant military areas of radar, under-water sound and airborne electronics, wasin the forefront of this program from thestart. By the time of the Japanese attackon Pearl Harbor in December, 1941, vir-tually all of the Corporation's facilitieswere devoted to military requirements forradio equipment, radar, special tubes,acoustical devices and navigation systems.

The increasing demand for military elec-tronic equipment led, early in the war, toseveral important changes in RCA's organi-zation and facilities to expedite research,engineering and production. The first ofthese related to the RCA research organiza-tion.

During the 1930s RCA's research facili-ties had been concentrated largely at themanufacturing plants in Camden andHarrison in addition to the communica-tions research groups on Long Island. Bylate 1940, the growth of defense activitieshad generated a need for increased staffand facilities, both for research and manu-facturing. At the same time it was recog-nized that the research program couldbenefit from a separate environment inwhich the laboratories might physically

4

be brought together to obtain better coor-dination and direction. Thus, in March,1941, the research staffs were incorpo-rated as a new department called RCALaboratories. Concurrently, work wasstarted on a new research center at Prince-ton, New Jersey, approximately midwaybetween the Camden and Harrisonoperations.

Dedicated in September, 1942, the newbuilding-the present David Sarnoff Re-search Center-provided the RCA researchstaff for the first time with complete mod-em facilities in an environment fully con-ducive to creative research. Further, itprovided a physical as well as an adminis-trative unity impossible under previous con-ditions.

In addition to the new research centerat Princeton, expansion early in the warincluded new facilities for production. Ad-vances in military electronics, particularlyin such high -frequency applications as ra-dar and microwave communications, ledto a greatly increased demand for special-purpose radio and electron tubes. To meetthis need, the U.S. Navy undertook con-struction of a large new plant at Lancas-ter, Pennsylvania, to be operated by RCA.Completed in 1942, the plant operated atfull capacity through the war to producehundreds of thousands of tubes for mil-itary applications. At the war's end, itwas purchased from the Navy by RCA.

5

1 6

1938-1958

4. RCA electronic equipment was used dur-ing World War II 10 test muzzle velocities oflarge -caliber guns.

5. Experimental RCA "Block" tv, forerunnerof modern miniature tv systems, was deve-loped and tested during World War II forairborne applications.

6. TK-I0, first commercial black -and -whiteorthicon tv camera, ca. 1945.

7. General Sarnoff addressing press atdemonstration of all -electronic color tv in1946.

6

A further organizational change of sig-nificance was made in December, 1942,to achieve closer coordination of all RCAmanufacturing activities. The RCA Manu-facturing Company, established in 1935as a wholly owned subsidiary of RCA, wasconsolidated with the parent Corporationto become the RCA Victor Division, com-prising all of the Corporation's tube andelectronic equipment production facilities.

Contributions to victory

The contributions to victory of the divisionsand services of RCA, in research, engi-neering, production and service were exten-sive, varied and distinguished. Althoughthe list is too long for more than briefmention, it includes the following:

RCA Laboratories: New devices, sys-tems and techniques including theShoran navigation and blind -bombingsystem, airborne radar equipment, elec-tronic fire control, and airborne televi-sion equipment for aircraft, and guidedmissiles.

RCA Victor Division: Design and quan-tity production of tubes and electronicequipment including 200 types of elec-tron tubes and 350 types of electronic

apparatus. Among the large -quantityitems were some 20 million miniaturetubes and five million proximity fuses.Outstanding among types of equipmentwere radar altimeters, sound -poweredtelephones, battle announce equipmentand rf power generators.

RCA Communications: Initially provid-ing the only means of communicationwith the war zone, RCA Communica-tions worked closely with the Govern-ment to keep vital networks in operation.

Radlomarine Corporation: Producedmore than 40,000 major units of marineradio equipment, comprising 42 differ-ent types of radio and radar apparatusfor installation on merchant and supplyvessels.

RCA Institutes: Trained thousands ofArmy, Navy and Marine servicemen inradio and electronic techniques.

National Broadcasting Company: Pro-vided worldwide coverage of militaryoperations for broadcast to the publicand developed many special morale pro-grams. Television facilities, more limitedthan radio, were turned to morale andinstruction purposes.

1938-1958

9

The outstanding performance of thevarious RCA divisions through the war wasrecognized by seven Army -Navy "E" pen-nants, two U.S. Navy Bureau of OrdnanceFlags, the U.S. Maritime Pennant, the Vic-tory Fleet Flag and 27 stars for continued excel-lence in operations.

Return to peace

With the return of peace in 1945, RCAfound itself, with all other electronics manu-facturers, in a vastly changed environment.World War II had triggered a swift trans-formation in electronic technology. Re-search and engineering led to major ad-vances in high -frequency techniques, inelectronic systems development, in elec-tron optics and in other fields of futurepeace -time importance.

The post-war environment for the in-dustry was characterized by two totallynovel features-a far more versatile andsophisticated technology than in the pre-war years, and a substantial increase inthe number of participating and compet-ing companies. Moreover, this greatly ex-panded art and industry faced a tremen-dous demand for its products and servicesfrom a public recently released from war-time austerity.

Plans for converting its research, engi-neering and production facilities to a peace-

8

time basis were undertaken by RCA dur-ing the late stages of the war, when it hadbecome apparent that victory was at hand.As a result, the process of conversion wasrapidly carried out after V -J Day. Withineight weeks, RCA Victor plants at Bloo-mington, Indiana, and Camden were pro-ducing radios for the civilian market. Beforethe end of 1945, commercial tube produc-tion had been resumed at Harrison. Bymid -1946, production of television picturetubes and tubes for broadcast transmit-ters and industrial uses was under way atthe newly acquired Lancaster plant.

One organizational development of impor-tance in the conversion pattern was theestablishment, in February, 1945, of theRCA International Division. In anticipationof an expanded foreign market for elec-tronic equipment, the new division wasgiven responsibility for distribution of prod-ucts manufactured by RCA, the operationof foreign subsidiaries, and coordinationof all RCA international activities.

Post-war television

Full attention could now be given to theexpansion of a civilian television systemwhich literally had been nipped in thebud by World War 11. The pre-war sharingwith other manufacturers of RCA's televi-sion research and engineering experience

1938-1958

8. TK-40, first mumercial color by camera.

9. Miniature camera system developed byRCA for on -the -spot broadcasting was firstused al 1956 political conventions.

10. RCA Victrola Model 59171; ca. 1946-1947.

11. Experimental tricolor Iv camera tube,smaller and with simpler circuitry thanthree -tube color cameras.

10

and the availability of important technicaldevelopments to RCA licensees had madepossible a broad manufacturing base forhome receivers. By 1941, standards for thepresent television system also had beenworked out by the National Television Sys-tem Committee, an industry group, andapproved by the FCC.

Thus, by the end of the war, television notonly was ready for commercial application,but also was a better system, because ofresearch and engineering advancesachieved for military purposes. Amongthese were a more sensitive camera tube -the image orthicon, more powerful trans-mitting equipment operating over the fullbandwidth allocated to commercial service,improved picture display techniques basedon radar developments during the war,and effective network relay techniques.

Television activities resumed on a largescale during 1946. when the first networkwas opened, linking NBC facilities in NewYork and Washington by coaxial cable,and including Philadelphia and Sche-'wet ady.

It also was during 1946 that the RCAVictor Division placed the first post-wartelevision sets on the market. The basicmodel was the famed 630TS. with a ten -inch picture tube. Marketed at a price of$375, the 630TS' economy, reliability andhigh quality swept it into immediate pop-ularity. The nation's first quantity producedand marketed receiver. it was television'sequivalent of the "Model T." As much as11

any other single factor, the 630TS wasresponsible for the swift appearance oftelevision in American homes during theearly post-war years.

The pre-war practice of sharing withother manufacturers the results of R('Atelevision research and engineering expe-rience also was resumed vigorously. Engi-neering data relating to the 630TS wasmade available to other manufacturers inconjunction with industry spnposia heldat Camden. The result was a rapid growthof television production by many organiza-tions in the industry.

Another factor in television growth wasthe initiation of large-scale picture tubeproduction at the Lancaster plant during1946. By 1948, nonetheless, receiver saleshad expanded so rapidly that a shortagein picture tubes threatened to develop.This was minimized by R('A's ability tosupply tubes from the surplus accumu-lated at Lancaster during the previous twoyears in anticipation of just such anemergency.

Further expansion of R('A manufactur-ing facilities, extension of the NBC net-work, and improvements in the televisionsystem itself characterized the years after1946. A new plant for tube manufacturewas acquired at Marion, Ind., and placedin operation during 1949. In February, 1950,the RCA Victor Division produced its one -millionth Inane television receiver. At thesame time, the size of the picture tubesteadily grew larger, expanding in 1949 to

19

1938-1958

the 16 -inch metal cone, to 19 inches in1950, to the popular 21 -inch size by 1952.The NBC network, keeping pace with thegrowth of home televison, reached rapidlyacross the nation to link principal citiesin all of the 48 states. From the four -sta-tion network of 1946, it has grown todayto more than 200 network affiliates.

Color television

As the commercial television system ex-panded, RCA undertook an energetic post-war program of color television researchand development. Although mechanical tech-niques offered promise in terms of earlycommercial advantage, RCA decided, soonafter the war, to strive for an all -electroniccolor system fully compatible with black-

and -white. Outstanding progress wasachieved at RCA Laboratories during 1947and 1948. Several demonstrations wereheld, showing a color system employingthree kinescopes and combined with anoptical system to present a composite colorpicture.

In 1949, the FCC scheduled a series ofhearings to consider, among other mat-ters, the establishment of standards forcolor television transmission. At issue weretwo competing systems-a noncompatiblemechanical system of color, and the all -electronic compatible color system advo-cated by RCA.

As the hearings progressed, the researchstaff of RCA Laboratories, supported byengineering groups at the tube plants at12

Harrison and Lancaster, moved with fullspeed to the development of the finalbasic element in the compatible system-a single tube capable of producing pic-tures in full color. The result of this extra-ordinary effort, demonstrated publicly inMarch, 1950, was the tricolor kinescope,one of the outstanding achievements inearly post-war electronics. In the words ofGeneral Sarnoff: "Measured in comparisonwith every major development in radio andtelevison over the past 50 years, this colortube will take its place in the annals oftelevision as a revolutionary and epoch-making device . . . As the master key topractical color television, it is an outstand-ing development of our time."

Despite the basic technical superiorityof all -electronic color transmission, the FCCgave its approval to the mechanical, non -compatible system. In effect, this bannedthe compatible system from the marketplace.

Through court actions, RCA vigorouslysought reversal of the FCC decision. Mean-while, it proceeded with further refine-ments in compatible color transmission.In December, 1953, the FCC finally ap-proved new and compatible standards recom-mended by the NTSC.

While receiver and tube productionforged ahead, color broadcasting equipmentwas speeded to television stations. By Oc-tober, 1952, 1 1 1 stations of the NBC net-work alone were equipped to broadcast inthe new medium. Today the compatiblecolor system embraces roughly half the

13

20

1938-1958

12. TYPHOON, world's largest and mostaccurate electronic analog computer couldevaluate performance of guided missiles,airplanes, ships, and submarines; ca.1950-1951.

13. RCA introduced a 45 -rpm system ofrecorded music.

14. Development of a molded plasticaspherical correcting lens for the Schmidt -type optical system helped make projection tvpractical, bury G. Maloof is shown removinga lens from a mold

15. The RCA electron microscope was amajor scientific development; shown are Dr.VK Zworykin (seated) and Dr. J. Hillier.

14

stations in America and is capable of reach-ing 96 percent of the nation's televisionhomes.

In 1949, television, now firmly estab-lished as a national broadcast service,moved in a new and significant direction.Development by RCA scientists of the smalland highly sensitive Vidicon pick-up tubeopened vast opportunities for closed-cir-cuit television for industry and education.

Other developmentsIf television, in all its aspects, was per-haps the most spectacular of the earlypost-war electronic developments, by nomeans was it the only one. A dramatictransformation in which RCA played a dom-inant role, was under way in the phono-graph and recording fields. In 1949, theCorporation introduced its 45 -rpm systemof recorded music, including the fastestautomatic record changer ever devised.

By the end of the year, 45 -rpm recordsof unbreakable vinyl plastic were beingproduced at the rate of more than25,000,000 annually and the numberdoubled in 1950. That year also saw theintroduction by RCA of a three -speed recordinstrument.

The growth of popular interest in high -

15

fidelity music reproduction spurred a num-ber of other RCA contributions to the newform of home entertainment. Among thesewas the LC1A duo -cone speaker, placed inproduction a year after its debut, in 1947, atthe Berkshire Music Festival. In 1953, RCAintroduced two high-fidelity Victrola phono-graphs designed for the mass market. Atthe same time it began to market a com-plete line of high -quality "intermatched"components for home -assembly.

National securityWork] War II, which saw the developmentof jet aircraft, radar, sonar, the V-2 rocketand other weapons of high complexity andgrowing effectiveness, presaged a new eraof military technology in which electron-ics would play a determining role. Anydoubts t.o the need to maintain a strongmilitary posture, supported by the latesttechnology, moreover, were dispelled bythe militant aggressiveness of the SovietUnion.

Thus RCA, which emerged from the waras one of the nation's foremost contribu-tors to military progress, continued to de-vote a significant proportion of its researchand development to problems of advancedmilitary technology.

1938-1958

Its work for the Government included avariety of development and production proj-ects in such fields as sonar, advancedradar apparatus and fire control. In 1950,for example, RCA Laboratories completedfor the U.S. Navy the development andconstruction of the world's largest andmost accurate electronic analog computerto evaluate the performance of guided mis-siles, airplanes, ships and submarines.

When war in Korea erupted in 1950,RCA's activities in the fields of militaryelectronics increased sharply. The Govern-ment field service activity of the RCA Ser-vice Company stepped up to such an extentthat by the end of the year, approximatelytwice as many trained field engineers wereassigned to military activities as at thepeak of World War II. In manufacturing,new projects for the military included equip-ment in the fields of electronic sound,sonar, missiles, navigation and communi-cations.

This, in turn, necessitated additionalplant expansion, devoted wholly or in largepart to defense purposes. Cincinnati; LosAngeles; Woodbridge and Moorestown, NewJersey; and a new engineering laboratoryat Waltham, Massachusetts, were some ofthe sites for these new RCA facilities. In1954, announcement was made of whatwas to become one of the most significantRCA contributions to national defense-the beginning of RCA Service Companymaintenance and analysis of electronic guid-ance apparatus for missiles at the AirForce Missile Test Center at Cape Cana-veral, Florida.

The extent and scope of RCA's militaryelectronic activities may be gauged fromsome of the projects in which it was en-gaged during 1957, such as, instrumenta-tion radar, the Talos Defense unit, and the"Telemite" television camera, fitting thepalm of a man's hand.

Organizational changesThe expansion by RCA into these manyareas of electronics was paced by a com-

parable realignment and extension of RCAexecutive and administrative functions.

In July, 1947, following the retirementof Lieut. General James G. Harbord, DavidSarnoff was elected Chairman of the Boardof Directors of RCA. The following year,Frank M. Folsom was elected President ofRCA. He was succeeded in January, 1957,by John L. Burns. At that time, Mr. Folsomwas elected Chairman of the ExecutiveCommittee of the RCA Board of Directors.

Keeping in step with the needs of asteadily expanding business in a constantlychanging industry, 1954 saw a series ofsweeping revisions of the Corporate struc-ture. The RCA Victor Division, formerlyresponsible for all RCA manufactured prod-ucts, became two separate groupings, RCAConsumer Products and RCA ElectronicProducts, each under the direction of anexecutive vice president. RCA Sales andService Subsidiaries formed a third group-ing. The importance of RCA Laboratoriesto the progress of the Corporation wasrecognized by the elevation of its positionin the Corporate structure. Behind thesebasic changes was the purpose of intensi-fied research, expanded manufacturing ca-pacity and greater diversity of output.

The revolution in materials

Underlying the Corporation's growth andchange after 1950 was a revolutionary trans-formation in the nature of electronics itself,resulting from fundamental advances inthe field of new materials and their appli-cation. These opened the way to new de-vices, techniques, and systems that pre-viously were impossible of achievement,either technically or economically.

Throughout the 30s and 40s, basic re-search interest grew in the field of phys-ics of the solid state. This was fundamen-tal to the forthcoming rapid advances inthe use of electronically active solids-the semiconductors. RCA's effort blossomedfirst on photoconductors potentially usefulin television camera tubes.

Bell Telephone Laboratories research insemiconductor materials led to develop-ment of the transistor. RCA research inthis area moved at an early stage to analloy junction type which soon becamestandard in receiving circuitry. Throughthe early and middle 1950s, the Corpora-tion's research and development workranged ever more widely over the mate-rials field, covering the various semicon-ductor materials, including photoconduc-tors, thermoelectric materials, and mate -

16

22

1938-1958

16. Battery operated tr receiver.

17. Dr. Olsen with phonetic tape recorder.

17

rials exhibiting the photovoltaic effect; anda wide variety of luminescent and mag-netic materials. Among the outstandingresults of this work were new types oftransistors with greater power output andhigher frequency performance.

Systems engineeringdevelopmentsOther major accomplishments have re-sulted from increasing application of sys-tems engineering techniques in both mil-itary and commercial electronics. Throughthe early 1950s, RCA engaged in an in-tensive program of research and engi-neering related to electronic systems tocompute, sort, file, and recall large quan-tities of data and to perform a variety ofcomputing, clerical and other paperworkfunctions. Out of this program came Biz -mac, RCA's electronic data-processing sys-tem. In 1955, a four -unit Bizmac system,the world's largest electronic "brain," waspurchased by the U.S. Army for its Ordi-nance Tank -Automotive Command at De-troit, to keep track of more than 100 mil-lion tank and automotive spare parts inthe Army's world-wide inventory. During1956, major Bizmac installations were pur-chased by the New York Life InsuranceCompany and the Travelers Insurance Com-pany, Hartford, Connecticut.

Progress and prospectsThe quickened pace or electronic devel-opments and the mounting importance ofelectronics to the national defense resultedin continued adaptation of the RCA organ-izational structure. In 1955, two new majoroperational units were created, DefenseElectronic Products and Commercial Elec-tronic Products. In 1957, CEP was reor-ganized into RCA Industrial Electronic Prod-ucts, to provide still further impetus inthis rapidly expanding area of electronicdevelopment. An indication of the rapidgrowth of RCA activities in the transistorfield was the organization of the RCA Semi-conductor Division.

Meeting the demands of the comingAge of Space, RCA established in early1958 a new Astro-Electronics Products Divi-sion for the production of satellite andspace vehicle systems.

What are these demands and what arethe opportunities? As America enters theSpace Age, electronics assumes a pivotalrole in assuring continued national pro-gress in the technologies of peace andsecurity. As a leader in the industry, the

Radio Corporation of America begins thethird epoch of its existence with a flexi-bility in organization, a resourcefulness inresearch and a diversity of operations tomeet the challenges of the years ahead.

In research, devices and systems nownearing final development point the wayto new RCA opportunities for service tothe consumer, to business and to industry.Participation by RCA in the cooperativenuclear reactor for industrial research inatomic energy at Plainsboro, New Jersey,will enable the Corporation to pursue fun-damental electronics studies in the vitaland closely related area of nucleonics.RCA research and engineering organiza-tions are helping to explore methods forharnessing the power of the H-bomb forpeaceful uses.

In products and devices, color televi-sion, pioneered and developed by RCA,will dominate the broadcast scene as black -and -white television has done for the tenyears past. On the basis of industry -wideprojections, automation and electronic dataprocessing undoubtedly will provide an-other great market for RCA systems, aswill closed-circuit TV for industry. Out oftoday's research and development will comeother products for the consumer, such asnew forms of lighting, personal communi-cations equipment, home television taperecording, and a variety of other novelelectronic adjuncts to living.

If J.C. Warner could foresee the timewhen historians would look back to 1938as a period when the surface had barelybeen scratched, what is there to say aboutthe potentialities for RCA today? For all ofthe RCA's tremendous past growth, notonly is the surface of electronics still lar-gely unscratched, but now there is thenew challenge of the Space Age.

Writing in Fortune Magazine in 1955,General Sarnoff noted: "There is no ele-ment of material progress we know today...that will not seem, from the vantage pointof 1980, a fumbling prelude." When thatday finally comes, I am certain that somefuture historian will begin this review ofRCA with exactly those words.

23

1. RCA Labs research produced the field-ef-fect MOS transistor.

2. In 1958, RCA introduced the 501 generalpurpose computer, marking the full-scaleentry of RCA into the computer industry.

3. Tiros II satellite mounted to third stagerocket


E.W. Engstrom

The boom in color television, along with a constantprogression of new electronic prodLcts ranging frommicrocircuits to space systems characterized these years.

In considering events and developmentsfrom 1958 through 1962, the past five yearsof RCA history have been fully as mean-ingful as the two preceding time spans interms of change, accomplishment, diversi-fication, and growth. All of the expecta-tions for electronics and for RCA havebeen more than amply fulfilled.

RCA continued to achieve conspicuoussuccesses in its established lines of busi-ness. During the half decade, it venturedinto fields where growth and profit, halt-ing at first, began to manifest themselveswith increasing strength. At the same time,it advanced importantly in new technolo-gies whose potentialities for growth andservice are as great as any of the areas inwhich it now operates.

These developments are measurable inmany forms, and among the most readilyrecognizable are the traditional yardsticksof corporate accomplishment. Thus, RCAsales of goods and services rose duringthe half decade to an ali-time high of$1.75 billion, 50 percent greater than atthe end of 1957. Profits increased to $51.5million, 34 percent over 1957.

In ten years, 1948 through 1957, totalproducts and services sold amounted to$7.78 billion. In the past five years, 1958through 1962, the total was almost as large:$7.36 billion.

At the close of 1962, space devoted tomanufacturing was at a peak of 12 millionsquare feet, comprising new, expanded, orrenovated RCA plants in 12 of the nation's50 states. RCA's activities reached intohome instruments, electronic data proces-sing, electron tubes and semiconductordevices, radar and microwave equipment,scientific instruments, weather and com-munications satellites, broadcasting, andtechnical services. In major part, its pro-ducts and services were available through-out the Free World.

Color TV

The most important development by farto RCA in the past five years was theemergence of color TV as a new industryand as a public service of massive andmounting proportions.

Technologically, the record requires lit-tle updating, for the major research andengineering advances had been made priorto 1958. What gives color such transcen-dent importance to RCA is, that the pastfive years witnessed its transformation froma $130 million investment to a major sourceof Corporate profits. 11 vindicated the faithof one man-David Sarnoff-who stakedhis and the Corporations prestige on thenew medium while the rest of the indus-try stood aside or in opposition.

In 1960, color TV earned a profit forRCA for the first time since its introduc-tion in 1954, and color set profits alonewere measurable in seven figures. By thefollowing year, color TV-receivers, tubes,videotape, and other equipment-attainedthe status of a $100 million business, anachievement of no mean proportions inseven brief years.

By 1961, there occurred-finally-thelong-awaited color breakthrough. One byone, TV receiver manufacturers abandonedthe sidelines and entered the ranks. Bythe following year, nearly every major TVmanufacturer was actively marketing color,and industry volume reached $200 million.RCA's set sales for 1962 doubled over theyear before; its profits from color manu-facturing and services increased fivefold;and color sets and tubes became the larg-est single profit contributor of any pro-ducts sold by the company.

It is pointless to debate which camefirst in color TV-the sets or the pro-gramming. In all certainty, the develop-ment was concurrent. with receiver pur-chases soaring because of increased color

25

1958-1962 WIIIM1111111116iimum.programming, and programming benefitingin turn from the increase in color setownership. Thus, while there were 291 sta-tions equipped for network color and abare total of 700 hours of network pro-gramming in 1958, five years later thenumber of stations equipped for networkcolor came to 406 and network color broad-cast hours had risen to some 2000 for theyear.

Of the many brightly illuminated pagesin RCA's history there are few that gleammore brilliantly than those dealing withcolor. Indeed, there are few companieswhich can validly claim to have createdvirtually single-handed a new industry, andfew which more richly merit the rewardsof pioneering than RCA.

Electronic data processing

While RCA was mounting its major effortto make color television commercially vi-able, another decision had been made toenter in force a new, formidable, andcostly area of business-electronic dataprocessing.

The action entailed a bold and calcu-lated risk: the entry fees were exceedinglyheavy; returns were long delayed becauseof the large lease nature of the business;the competition was powerful and stronglyentrenched.

As Board Chairman Sarnoff subsequentlyexplained, the decision to go forward wasmade:

"First, because we have a technologi-cal background in electronics that givesus a capability in many computer areaswhich few, if any, other companies canrival. This is a young, fast -changing tech-nology, and the research breakthroughsof today will shape the character of theindustry tomorrow. We are well -posi-tioned to make contributions of funda-

4

mental importance to this evolution.

"Second, because electronic data pro-cessing has become a vital element ofmost major defense and space contracts.The company with skills in this areahas a decided competitive advantage.

"Third, because the commercial com-puter market is growing faster thanthe industry itself anticipated."

In 1958, RCA launched its major ven-ture into the electronic data processingfield with the introduction of the RCA501, a medium-sized commercial businesscomputer and the first fully transistorizedsystem in the industry. By 1960, the Cor-poration had introduced the compact RCA301 for medium -size and small businesses,and had announced a coming third entry,the RCA 601, for large enterprises andscientific computation.

One of the greatest of RCA's strengthslay in computer communications-backedby four decades of leadership, experience,and know-how in all types of communica-tions systems and equipment.

In 1959, RCA introduced DaSpan, a com-puter -to -computer communications systemwhich could span a continent, and gatherand coordinate vital data from the manyplants of a large industrial enterprise.

The same computer -communications know-how made RCA the supplier to WesternUnion, the prime contractor of an auto-matic electronic data switching system forthe Air Force Combat Logistics Network(ComLogNet) linking 350 bases and sta-tions across the country in the world'smost advanced communications systems.

Rapid economic expansion in other in-dustrial nations also gave RCA an unex-celled opportunity to extend its computeractivities overseas. In 1961, it concluded aseries of multimillion dollar export salesagreements with three of the world's lead -

5

1958-1962

4. Ground control equipment for meteoro-logical satellite applications al AEP.

5. RCA 501 all transistor business datasystem.

6. BMEWS radome at Moorestown, N.J.

7. Environmental test chamber at AEP.

6

ing data processing equipment manufac-turers-in Great Britain, Japan, and France.By the end of 1962, 158 computer systemshad been ordered by the three companies,and further orders placed for componentsand peripheral equipment.

Domestically, in addition to the rentalor sales of its computer systems, RCAestablished data-processing service centersin New York, Washington, D.C., Chicago,Cherry Hill, NJ., and San Francisco. Thesecenters provide computer service to smallbusinesses as well as offering program-ming and training services to buyers orlessees of RCA systems.

Whatever the risks and costs involved.the decision to enter data processing wasextremely sound. RCA not only staked outits share in one of the major electronicsgrowth markets but, equally important, itacquired the basis for continuing preemi-nence in other electronics fields wherecomputers and computer systems were in-dispensable to progress. Among these werethe vital areas of space and nationalsecurity.

Space and defenseOn October 4, 1957, the first signals froma man-made object in the skies heraldedthe dawn of a new era-the Age of Space.

Swiftly, RCA realized that space waspreeminently an electronics domain-fortracking, communications, computing andcontrols. Less than a year later, RCA setup a special division-Astro-ElectronicsProducts-for the development and pro-duction of satellites, space -vehicle systems,and associated electronic ground equip-ment. (That organization is now called theAstro-Electronics Division.)

In December of the same year, theworld's first successful satellite radio relayequipment, produced by RCA for the U.S.

7

Army Signal Corps, lofted into orbit aboardan Atlas missile. It broadcast to the worlda prerecorded Christmas message from Presi-dent Eisenhower, and then performed anumber of communications experimentsnever before attempted, looking to a newera in global communications.

Within the next four years, the Astro-Electronics Division had scored a series ofachievements which quickly catapultedRCA into the front rank of space or-ganizations.

Chief among these was a systems devel-opment of the first magnitude-an inte-grated ground and space complex for thetelevised observation of the world's weathervia satellites. Between 1960 and 1962, asmajor elements of the system, RCA devel-oped for the National Aeronautics andSpace Administration six Tiros weatherobservation satellites, all of which werelaunched and operated with optimum effec-tiveness. Up to the end of 1962, the Tirosseries-ranking as the nation's most suc-cessful space venture-provided a total ofmore than 200,000 televised images of cloudformations and other global weather datafor use by weather scientists and forecast-ers. The average useful life span of thesatellites was more than double the oper-ating life called for by the initial designspecifications.

Another significant feat was the Relaycommunications satellite, which afterlaunching in December 1962, experiencedinitial operating difficulties. These subse-quently were overcome, and by early 1963,Relay was transmitting television picturesof remarkable clarity between the UnitedStates and Europe, and conducting radiocommunications with Latin America.

The Astro-Electronics Division has alsoprovided the advanced television equip-ment for the Ranger lunar probes, televi-sion systems and solar -cell power supplies

for the second -generation Nimbus weathersatellite, and was engaged in the designand construction of the SERT vehicle forthe space testing of experimental electricpropulsion systems.

Portending still greater growth in yearsto come, an environmental test facility,most advanced of its kind in the electron-ics industry, was put into full operationduring 1962 at RCA's Space Center, nearPrinceton, NJ. Space concepts and sys-tems now germinating in various RCA re-search areas may undertake their initialtrials in this environmental center and soprovide new episodes for future RCA his-torians to record.

The complexities manifested in compu-ter and space electronics are fully matchedin the area of defense. From tlw produc-tion of relatively simple hardware for com-munications, electronics for military pur-poses has burgeoned into vast and com-plicated systems-frequently global inscope, integrating multiple techniques andsubsystems, and employing the resourcesof many varied organizations.

RCA's depth of experience in systemsengineering and its military electronicsbackground dating to the mid -thirtiesearned for it one of the lead positionsamong designers and constructors of suchadvanced systems for the armed services.

In 1958, RCA received one of the larg-est contracts ever awarded by the Depart-ment of Defense, to assume the projectmanagement of the Ballistic Missile EarlyWarning System (BMEWS) to provide ad-vance warning of an enemy missile attackacross the polar wastes. As manager ofthis vast undertaking, it employed 485large companies and 2415 smaller firmsspread over 29 states to get the job doneswiftly and efficiently. By the end of 1962,

8

two installations (Thule, Greenland, andClear, Alaska) were operative and the thirdwas nearing completion in Yorkshire,England.

The need for virtually instantaneous warn-ing against impending missile attack as-sumes similar readiness for counterattack.In the past half -decade, RCA contributedsignificantly to a greatly strengthened de-fense posture with the development ofautomatic programmed checkout equip-ment (APCHE) and launch -control equip-ment for several series of the Atlas ICBM.

Subsequently, major RCA work on theMinuteman ICBM involved advanced con-cepts in.command-and-control systems, in-cluding the sensitive -command and sup-port -information networks, and checkoutand test techniques. Especially challeng-ing for both design and production werevery high -reliability goals for sophisticatedequipment-goals that pushed the stateof the art.

By the end of 1962, RCA was deep intosuch diverse developments and construc-tions as a flight -control system and check-out for the super -powerful Saturn booster,telemetry equipment for the two -man Gemi-ni space vehicle, miniaturized computerssuch as Micropac (built with micro -modules) for military field use, and a var-iety of communications systems and testapparatus, including a lunar -landingsimulator.

In 1962, RCA also could point to some22,000 scientists, engineers, and produc-tion personnel-roughly a quarter of allRCA employees-working at eleven defenseand space centers. In that year, the Cor-poration's total volume of government busi-ness exceeded $600 million, or more thana third of the Corporate total.

1111111111111111111111L1958-1962

8. TRT-1 ac videotape recorders in operationat NBC, New York in 1961.

9. Thin-film transistor, first practicalamplifying device made entirely by evapora-tion Itchnigues, was produced by RCA Labs.

10. 7'hermionic converter. Direct energyconversion was a major RCA effort duringthe 1957-62 period.

11. Low-cost, quality tape recorders weredeveloped for a growing hi-fi market.

10

Circuitry and components

Basic to all RCA progress in both the oldand new fields of electronics were theadvances made in electronic circuitry andcomponents.

RCA's Electron Tube Division, facingthe growing competition of semiconduc-tors, moved quickly and aggressively tosustain its position through intensified prod-uct and market development.

One decision was to concentrate pro-duction and sales in those areas wheresemiconductors could not yet compete.Conspicuous success was achieved in heavy-duty and special-purpose tubes. From 1958through 1962, RCA developed some 800new tubes of this variety.

Another decision was to compete directlywith semiconductors through greatly im-proved low-cost vacuum tube products. In1959, the Tube Division announced therevolutionary Nuvistor, a receiving tube assmall as a thimble and incorporating highreliability and durability. This was followedthe next year with a new line of metal -to -ceramic Cermolox power tubes for trans-mitter applications, one of which wasaboard the famed Pioneer V Venus probe.

A third decision was to join the movetoward semiconductors where this wouldblend with skills and technologies per-fected in some three and a half decadesof tube development. In 1960, for exam-ple, the Division began to manufacturesolid-state photoconductors and silicon so-lar cells.

Finally, the Tube Division decided todiversify its product line and seek whollynew products. A new Business Develop-ment Department was set up for new itemswhose revenues could replace or even sur-pass those from older tube products. Bythe end of 1962, the first results werebeginning to hear fruit-in thermoelectricpower generation and cooling, thermionic

11

energy conversion, superconductive mag-nets, electroluminescent materials, and high-speed reed switches for computer and tele-phone relay circuits.

Challenge and change also confrontedRCA's Semiconductor and Materials Divi-sion. The challenge came in the form ofintense competition where companies-old and new, large and small-thronged amarket of supposedly unlimited profitabil-ity and growth. Change came in the rapidobsolescence of materials and devices un-der the stimulus of quickening researchand development.

Organized in 1955 primarily to manu-facture germanium transistor devices forconsumer purposes, the Division swiftlyexpanded in size and scope. By 1962, forexample, it had become the leading domes-tic producer of solid-state semiconductordevices for consumer products, and over100 million of its germanium units were inuse.

With the advent of high -power silicondevices, the semiconductor field grew toembrace industrial, computer, and militaryapplications, and with this came corres-ponding growth in RCA activities. Newmanufacturing facilities were added, newdevices developed, and new marketsopened. Ultra -high-speed tunnel diodes, gal-lium arsenide rectifiers, and microferritesfor computer memories were among theproduct developments of the period.

But the continuing solid-state revolutioninvolved more than the geometric expan-sion of individual circuit, devices and appli-cations. Equally fundamental to the futureof electronics was the emergence of mate-rials and techniques leading from sepa-rate components to assemblies of compo-nents functioning as complete circuits andsubsystems. In this, RCA played a leadingrole, with the U.S. Army Signal Corps, inthe development of mimmodules. With

29

1958-1962

later developments-for example, thin-filmactive devices, and the insulated -gate MOS(metal -oxide -semiconductor) transistor-RCA reaffirmed its position as an industryleader in advanced integrated circuitry.

Old areas-new opportunitiesChange, diversification, and growth werereadily evident in other divisions and ser-vices of the Corporation. New technolo-gies, products and systems infused vigor-ous progress in both the older as well asthe more recent RCA activities.

The RCA Victor Home Instruments Div-ision, which in 1961 moved from CherryHill, NJ., to a consolidated operation inIndianapolis, Indiana, continued to advancein the design and marketing of home enter-tainment products. Particular emphasis dur-ing the past half -decade was placed onstereophonic high-fidelity record and tapeplayers for the growing high-fidelity musicmarket, on transistorized pocket radios,and on black -and -white as well as colortelevision.

One milestone was the production in1958 of the ten millionth RCA Victor black -and -white television receiver. Another wasthe introduction, a year later, of the firstminiature transistor radio to be producedentirely in the United States. By the endof 1962, Home Instruments could point toan overall sales increase of 30 percentover the previous year, exceeding the ear-lier all-time record established in 1956.

The RCA Victor Record Division madesignificant progress in new sound -repro-duction techniques at the same time thatit advanced briskly into new marketingmethods and areas, In 1961, Victor Recordsintroduced a new electronic process forreproducing stereo recording originally re-corded in a monaural sound. The year fol-lowing, it opened the world's largest andmost modern recording studio, in Rome,Italy.

Early in 1963, after two years of inten-sive research and development, Victor Rec-ords also announced a striking new pro-cess of music reproduction-Dynagroove-bringing recorded music more closely thanever before to live music.

In the five-year period, Victor Recordsaggressively expanded its Record Clubsaround the nation, while developing newretail sales outlets such as supermarketsand drug chains. Overseas, RCA becamethe leading U.S. company in the interna-tional field, and by the end of 1962, VictorRecords could report the largest sales vol-ume in its history, with gains scored in allproduct lines.

For industry, for broadcasting and com-munications, RCA continued to developnew microwave systems, transistorized video-tape recorders for both color and black -and -white broadcasting, and new color cam-eras. Among its pioneering advances wereclosed-circuit equipment for educationalpurposes.

In 1962, RCA also manufactured anddelivered its 1000th electron microscope,assembled on the same production linethat completed the first commercial instru-ment nearly a quarter century earlier.

Significant growth trends also manifestedthemselves at the National BroadcastingCompany, which moved into commandingleadership in providing the public with abroad range of news and public affairscoverage. By 1962, 25 percent of NBC -TV'sschedule was in this category.

Earlier, NBC pioneered an educationalexperiment by presenting a college levelcourse, "Continental Classroom," demon-strating that commercial broadcasting couldperform a significant role in education.And its massive programming on behalf ofcolor was as responsible as any single fac-tor in hastening the ultimate mass -marketbreakthrough. These and other develop-ments culminated, in 1962, with the high-est sales and earnings in NBC's 36 -yearhistory.

As meaningful as any aspect of elec-tronics' growth during the past five yearswas its expansion on a global scale. It wasreflected in the RCA Service Companywhere, by the end of 1962, there weresome 16,000 employees in the United Statesand 36 foreign countries. Its activitiesranged from maintenance of the BMEWSemplacements in Alaska and Greenland toresponsibility for the control and data gath-ering activities at the Cape Canaveral, Flor-ida, space center. Here, incidentally, whereRCA undertook its first technical assign-ment 10 years earlier with 26 techniciansand engineers, there were approximately4000 RCA people in 1962.

By early 1963, the RCA Service Com-pany was able to report that revenues forthe year from installations and service oncolor -TV receivers could surpass for thefirst time revenues on black -and -white sets.And with equal portent for the future, theService Company moved into still anotherspace activity-the design and construc-tion of space chambers and solar simulators.

World economic expansion and the emer-gence of new nations were reflected bythe growing demand, during the five-yearperiod, for basic and advanced types ofcommunications and broadcast equipment.

12. Use of videotape helped in staging andintegrating special scenes such as this fromNBC's Peter Pan.

13. Dr. Zoltan Kiss checks calcium fluoridedysprosium -doped laser 'pumped' by focusedsunlight-done for the first time in 1962.

12

30

1958-1962

13

RCA sales and installations extended toevery continent-from broadcasting equip-ment and stations to entire national andinternational television and communica-tions systems.

The same economic expansion foundfurther expression in the global commun-ications services of RCA Communications,Inc. By the end of 1962, it was providingmore channels between this country and100 others than any other U.S. interna-tional communications carrier. In early1963, RCA Communications applied for per-mission to purchase shares in the newSatellite Communications Corporation, thusassuring for RCA still another role in therapidly unfolding progress of electronics.

Research and progress

Behind the extraordinary five-year recordof RCA change, diversification, and growthstood the basic and applied achievementsof the RCA Laboratories-ranging from rev-olutionary high-speed computer techniquesto submarine communications to spacetelescope guidance.

The variety of RCA research activitiesmay he gleaned from a few samplings ofthe past five years. In 1958, RCA joinednine other companies in ownership andoperation of a nuclear reactor, for thepurpose of conducting radiation studiesrelating to RCA projects and areas of inter-est. That year too, RCA Laboratories joinedin the design and construction of the CStellarator, which may provide an answerto the control of thermonuclear fusion forpeaceful purposes. The following year, itundertook two projects approaching theultimate in geographic disparity. One wasfor the design and development of an ad-vanced communications system for thePolaris program; the other was to buildthe television guidance system for theStratoscope I and II balloon -borne tele-scopic observations of the sun and planets.

RCA scientists had the assignment ofdeveloping the key elements of a compu-ter that would operate at speeds a thou-sand times faster than the swiftest com-puter yet built. On yet another track. in1960, they completed the "electronic high-way" to demonstrate the feasibility of elec-tronics for the control and movement ofroad traffic.

Most significant for the long run, per-haps, were the RCA Laboratories' contri-butions in the areas of basic circuitry,energy conversion, superconductivity, andlaser technology. These have led in thepast five years to such research advancesas thin-film transistors, super -conductive

magnets capable of generating enormousmagnetic fields, superconductive thin-filmmemories, crystal lasers activated by nat-ural sunlight, and new thermoelectric andthermionic generators.

To the breadth and depth of its scien-tific probings, RCA also added the ele-ment of greater speed in converting re-search to applied development. Most ofthe Corporation's principal operating div-isions now maintain development groupsof their own engineering specialists at theRCA Laboratories at Princeton. These devel-opment groups work directly with the labo-ratory research teams, adding a vital newperspective to many RCA scientific pro-jects, and furnishing the link for the swifttransmission of new materials, devices, andtechniques to the divisions to transformthem into new products and market oppor-tunities.

Looking to the future

In reviewing the past, one's thoughts inev-itably turn to the future of electronics andRCA, for it is there that the most interest-ing history will be written. For that future,it no longer seems sufficient to say, as inthe first two segments of the RCA history,that the surface of electronics has barelybeen scratched. As electronics broadensits contributions to the nation and theindividual, and as its influence extendsaround the globe and deep into space,new dimensions of service as well as newconcepts of opportunity come into focus.

At the present point in time and his-toric development, electronics perhaps isthe single most important instrument atthe disposal of mankind for the solutionof present problems and the advance tonew levels of well-being. Electronics pro-vides means of comprehension and actionfar beyond the capacity of the brain tograsp or the hand to move. In science,medicine, manufacturing and commerce,transportation, agriculture, education,energy, space exploration, and communi-cations, electronics is the lever to stillgreater progress-directly or as the cata-lyst to other efforts. Its reach has extendedfar beyond the surface of technologicalgrowth to embrace virtually every activity,human or natural, affecting civilization.

In such a context of service and oppor-tunity RCA is uniquely positioned to a-chieve the optimum. In these past fiveyears, it has strengthened beyond measureits resources and capabilities for leader-ship in any direction which the scienceand industry of electronics may take.

31

iltap40P

4."ft01.

2

1. Solar panels for Lunar Orbiter II.

2. Computers such as RCA's Electronic Tele-graph system revolutionized internationalcommunications.

Part 4 The years 1962-1966E.W.Engstrom

Vigorous growth and an outward tnrust took the companyinto such new areas of business as publishing, graphic arts,education, medical electronics, and car rentals.

By any measure, the rate of growth duringthese years was impressive. Total annualsales increased from $1.75 billion in 1962to $2.5 billion in 1966. During the sameperiod, net profits more than doubled.

RCA's manufacturing capacity was vastlyincreased as more than $500 million wasspent to build new plant facilities andexpand existing ones. In 1966 alone, thecompany undertook the largest domesticcapital expenditure in its history, allocat-ing $198 million for the construction ofnew plants at 11 locations and substantialexpansion at 15 other operating facilities.These additions involved such key activi-ties as color television, home instruments,syniconductors, computers, and com-munications.

By early 1967, total employment hadgrown to exceed 120,000 people in theUnited States and abroad, up from approxi-mately 93,000 five years earlier.

During the four-year period, RCA main-tained a growth rate that consistently out-paced the average of all American manu-facturing enterprises. In 1966, the per-centage of sales increase over the previousyear was double that of the average for allother manufacturers, and the company'sprofit increase of 28% contrasted with theaverage manufacturing rise of 11%.

This outstanding performance reflectedmany influences-a sustained period ofstrong consumer demand for RCA homeentertainment products; a steady growthin other established areas of business,such as commercial and industrial elec-tronic products; and a vigorous involve-ment in new ventures, such as publishing,the graphic arts, education, and medicalelectronics.

Coupled with these trends was a grad-ual change in the character of the elec-tronics industry. From its initial concernwith communications and entertainment,

electronics was steadily evolving into therole of a basic industry whose productsand services are vital to virtually everyother industrial activity. This provided abroader base than ever before for the com-pany's growth.

Color TV and the consumer market

While all these factors contributed mate-rially, the force that gave the greatestimpetus to RCA's performance between1962 and 1966 was unquestionably colortelevision. The pioneering days of the latefifties and early sixties were over, and infive short years, color television mush-roomed from an annual retail sales levelof $200 million to more than $3 billion.This latter figure was achieved in 1966,when consumers spent more money to pur-chase color television sets than they didfor all other home instruments, includingblack -and -white televisions, radios, pho-nographs, and tape recorders.

Beyond the manufacture and sale ofsets and tubes, the color television indus-try embraces the production of studio andtransmitting equipment, such as color cam-eras and videotape machines. It includesbroadcasting, programming, service, andthe production of the many electronic com-ponents that go into the final assembly ofa set.

Because of its decision to blaze a trailin color, RCA had long before developedits own capabilities in all these areas. Itwas recognized that if color television wereto succeed, it had to be presented to thepublic as a total system. As a result, manydivisions of RCA experienced major gainsin sales as public opinion on color televi-sion changed from the cautious interest of1962 to the unrestrained eagerness of 1966.

RCA was in a position to take full advan-tage of the new opportunities presented

33

1962-1966 .1111111.1111111111111.1111111111by the rapid expansion of the market andto take the lead in many new develop-ments. Slimmer cabinet styling replacedthe earlier, bulkier models as the 90 -degreerectangular color television picture tubegradually replaced the 21 -inch round tubewhich had been the industry standard fornearly a decade. By the end of 1966, pro-duction of this older model was entirelyphased out, and RCA was manufacturingfour different color picture tube sizes -15, 19, 22, and 25 inches-for a diverseline of portable, tabletop and console mod-el receivers. (When used in sets, thesetube sizes are now designated as 14-, 18-,20-, and 23 -inch picture diagonal.)

The addition of rare earth phosphorsfrom materials research added greater bright-ness and clarity to the color picture. In1966, integrated circuits were introducedfor the first time into home instrumentswhen RCA employed them in the audiostage of its color and black -and -white TVs.

The years 1962 through 1966 also sawsteady advances in the manufacture ofcolor transmission equipment. A new, all -transistorized tape recorder for both colorand black -and -white television, the TR-22,found a ready market among broadcastersand closed-circuit television operators bothin the United States and abroad.

In 1964, as the result of a major engi-neering development effort, RCA's Broad-cast and Communications Products Div-ision presented an entirely new look inbroadcasting equipment. The new line fea-tured sweeping changes in design, appear-ance, and function, and employed the useof solid-state components whereverpossible.

By the end of 1966, 450 out of approxi-mately 650 commercial television stationsin the country were equipped to originate3

color programs from film. About 150 sta-tions could originate live color programs.

Leading the way towards full conver-sion to color was the National Broadcast-ing Company. In the autumn of 1962, about68% of NBC's total nighttime programmingwas in color. By the end of 1966, theentire network schedule was broadcast incolor, with the occasional exception offeature films originally photographed inblack -and -white.

The spectacular growth of color televi-sion was the principal feature of a gener-ally thriving consumer market for elec-tronics. In 1965, for example, RCA soldmore black -and -white television sets thanin any year since 1955. By the end of 1966,industry sales of both imported and domes-tic radios were approximately 44 millionunits, up from a little over 33 millionunits sold five years earlier.

Stereophonic sound was firmly rootedin the home instruments market, and in-dustry sales of phonographs increased eachyear from 1962 to 1966, with RCA Victrolaphonographs leading the way. Music ontape gained in popularity during the period,and the company responded by marketinga full line of reel-to-reel and cartridgetape recorders.

As phonograph and tape recorder salesincreased, the RCA Victor Record Divisionalso enjoyed a succession of peak years. In1966 the Division completed three succes-sive years in which all-time sales volumelevels were reached. A significant devel-opment in 1965 added a new force to thisaspect of the home entertainment market.This was the introduction of prerecordedStereo 8 tape cartridges and players foruse in automobiles and homes. RCA VictorRecords pioneered in the production ofmusical selections on Stereo 8 cartridges,

3. Sales of RCA Victrola phonographs andreel-to-reel stereo tape recorders increased.

4. Portable le sets are readied for shipmentat Memphis plant.

5. Battery -powered tape recorders foundnew uses in home and school.

and a home player for the tapes was intro-duced in the 1966 home instruments line.

The Stereo 8 cartridge and player typi-fied the growing trend to more casualelectronic entertainment equipment, de-signed for use anywhere. The televisionset and the phonograph were no longerregarded only as items of furniture for thehome, and demand grew for personalized,portable entertainment indoors, outdoors,and on the road.

Compu:ersand industrial electronicsThe expansion of the consumer electron-ics market in the five-year period had itscounterpart in commercial and industrialmarkets. RCA served this market with awide variety of products and services rang-ing from data processing installations toradar equipment for the aircraft industry.

Electronic data processing equipmentwas the most dynamic element on thecommercial and industrial scene, both intechnology and in business growth. In hard-ware alone, the sales volume of the com-puter industry rose from about $1.8 billionin 1962 to more than $3 billion in 1966.

The period brought significant advan-ces for RCA in system design and pro-gramming concepts, and the company fur-ther solidified its position for the long runin the computer market.

At the end of 1962, the product lineconsisted largely of the 301 system formedium and small business enterprisesand the larger RCA 601 for industrial andscientific use. In 1963, a versatile newunit, the 3301 Realcom, was added to theline as the first computer designed tospan the full range of data handling capa-bilities in a single system-business dataprocessing, high-speed communications, real-time management control, and scientificcomputation.

In the same year, a significant adjunctto these systems was introduced in theRCA 3488 mass memory, designed to holdseveral billion characters and to operatewith either the 3301 or the 301.

Progress in circuit design and systemconcepts led in 1964 to a major step for-ward. RCA introduced the Spectra 70 se-ries, the first in the industry of a newthird generation of computers. The groupinitially included four compatible general-purpose computers-two of them employ-ing the first monolithic integrated circuitsto be used in commercial equipment. Afifth model was added in 1965.

Singly or in multiples, these systemswere ordered by insurance companies, manu-

facturing industries, airlines, railroads, gov-ernment agencies, and many other usersin the United States and abroad.

As the 1960s progressed, computer sys-tems were put to increasingly sophisti-cated use in a wide range of business andpublic functions. At its inception a decadeand a half ago, electronic data processingequipment was regarded principally as animmensely powerful tool for use in therepetitive and clerical tasks of commerceand industry. Through the past few years,progress in programming techniques aswell as hardware has led to increasingapplication of the systems in more com-plex tasks of information processing, frommanagement simulation to the analysis ofphysical, social, and other problems withmany variables.

Within RCA, for example, computerswere employed on a growing scale formanagement information. In this function,systems at various operating divisions andat corporate headquarters were programmedto supply current information on all aspectsof the company's operations and to aid inplanning and decision -making by indicat-ing trends in the wide range of factorsaffecting production and marketing.

Another significant trend was the grow-ing relationship between computers andcommunications-both in the developmentof computer -to -computer links and in theuse of computers to increase the speedand flexibility of communications.

RCA introduced several advanced ter-minal devices during the 1962-1966 periodfor communication between computers andusers. Among them were a voice responseunit that provided spoken replies to inquir-ies telephoned directly to a computer, anda self-contained video display unit employ-ing integrated circuitry.

The greater use of computers as toolsin communication systems was evident inthe operations and services of RCA Com-munications, Inc. In 1964, an ElectronicTelegraph System (ETS), employing RCAcomputers of special design, was put intooperation at the RCA Communications, Inc.facaities in New York to route, process,and transmit overseas message electroni-cally, in great volume at high speed. Theinnovation came at a time when commun-ications satellites were on the verge ofmultiplying international channel capac-ity. The combination of expanded chan-nels and electronic message switching prom-ised, by the end of 1966, to revolutionizeinternational communications in terms ofvolume and scope of services.

There were indications of this in twonew services introduced by RCA Commun-

35

1962-1966

ications. In 1965, the company announcedDatel, a service for overseas data trans-mission from punched tape or cards, ormagnetic tape, at speeds up to 1200 wordsa minute. In 1966, it introduced a newservice concept incorporating computer tech-niques in an Automated Information andReservations Computer operated Network(AIRCON) for message processing and res-ervations.

In addition to its activities in compu-ters and data processing, RCA played asignificant part during the period in sup-plying new products and services for otherbusiness needs. Among the notable con-tributions were airborne weather radar sys-tems for commercial and business aircraft,and at the end of 1966, RCA was one ofthe largest suppliers of such equipment.Two-way mobile radio communications sys-tems were developed and installed in truck-ing fleets and public transportation bussystems, including those of the New YorkCity Transit Authority. In the fall of 1964,the Western Union transcontinental micro-wave network, the longest single micro-wave project ever undertaken at one time,went into operation with RCA equipmentin its 267 relay and terminal stations.

Electronic components

In 1963, RCA's Semiconductor and Mate-rials Division was consolidated with theElectron Tube Division to form a new oper-ating unit known as Electronic Compo-nents and Devices. The blending of thenewer technology with the older in anorganized sense can he said to symbolizethe coming of age of solid-state electron-ics as a business. The move enabled all ofRCA's talents in the field of electroniccomponents and circuitry to be employed

6

on a more closely coordinated basis. Theresults of the union have since demon-strated both the potential of the youngsolid-state art, and the continuing vigor ofelectron tube technology.

Electron tubes remained unchallengedin many areas. In the fail of 1964, RCAproduced its three -millionth color televi-sion picture tube, a short time after it hadturned out its 25 -millionth monochrometube. Significant innovations were madein television pickup tubes, including im-proved vidicons for studio cameras and anumber of special purpose types. Amongthe latter were several built for use in theRanger lunar vehicle, and one employedfor underwater television equipment usedby the Navy to recover missiles andtorpedoes.

Many other special tube types were pro-vided by the new division, including ahigh -efficiency trAvling-wave tube for micro-wave systems, high -efficiency thermionicconverters, and special klystmn power tubesemployed in the 2 -mile accelerator at Stan-ford University in 1966.

The application of new solid-state tech-nology and materials research led to sig-nificant contributions during the periodin new and improved components and de-vices for a variety of uses. In 1964 and1965, for example, RCA introduced thenew "overlay" transistors and a promisingline of silicon power transistors for use inpublic address and home sound equipment.The company also continued as a leaderin the production of transistors for use inautomobile radios.

A major new activity was launched in1963 to engineer, develop, and produceintegrated circuits for general use. Twoyears later, RCA made its full-scale entryinto this new market with an initial line

7

1962-1966

6. The Spectra 70/45 computer makes possi-ble instantaneous credit authorization.

7. In 1965 high -temperature furnaces wereadded to RCA's integrated circuit facility inSomerville.

8. Weather pictures from the RCA APTcamera system on the Nimbus 11 satellitewere automatically transmitted to groundstations.

8

of 17 types for application in communica-tions, instrumentation, and industrial andmilitary equipment, as well as computers.By mid -1966, the family of new circuitshad been increased to 25, and integratedcircuit sales had become a significant fac-tor in RCA's total components business.

The new Electronic Components andDevices activity launched other vigorousprograms to develop new business. An out-standing example, based on pioneeringwork at RCA Laboratories, was the com-pany's entrance into commercial produc-tion and sale of superconductive magnets,principally for use in nuclear research.

Space and military electronicsThe most dramatic achievement for RCAin space between 1962 and 1966 occurredin 1964 when NASA's Ranger 7, with a six -camera payload designed and built by RCA'sAstro-Electronics Division, reached themoon and sent back the most detailedphotographs ever taken of the lunar sur-face. This was followed in 1965 with thesuccessful launch of the Ranger 8 and 9spacecraft, which together obtained andtransmitted to earth nearly 13,000 close-up views of the moon.

The Tiros television weather satelliteprogram continued an unbroken series ofsuccesses. In 1962, three Tiros satellites,developed by RCA, were placed into orbit,providing television pictures for worldwideweather forecasting.

The following year, two more Tiros satel-lites were launched, and Relay I, a com-munications satellite built by RCA forNASA, completed its scheduled year -longmission. Among Relay's achievements werethe first space transmission of a color tele-cast, simultaneous voice relays betweenthe United States and Brazil, and the firsttrans -Pacific transmission from the UnitedStates to Japan.

RCA in 1963 was assigned major rolesin the Apollo program, this country's at-tempt to land astronauts on the moon.The company was selected to develop com-munications and control systems for theLunar Excursion Module, which was sched-uled to perform the actual landing. In

addition, RCA contracted to build thepower and communications equipment forthe Lunar orbiter, designed to transmitpictures from an orbit around the moon insearch of a suitable landing site. During1965 and 1966, spacecraft in the orbiterseries returned remarkable pictures of se-lected areas from altitudes as low as 28miles above the moon.

The major RCA contributions to the na-

tion's space program in the 1962-1966 pt,riod included the picture -taking systemsfor NASA's experimental Nimbus satelliteto map global weather conditions; a secondsuccessful Relay communications satellite;three more Tiros weather satellites, and acontinuation of the Tiros program underthe name of ESSA (Environmental ScienceServices Administration) which establishedthe first operational weather satellitesystem.

In other aspects of the space effort,RCA delivered tracking radars for the Apol-lo Radar Instrumentation Ships and theApollo Recovery Ships. It provided com-munications links between NASA headquar-ters in the United States and various over-seas tracking locations, including voiceand teletypewriter circuits to tracking ves-sels at sea, alternate voice/data and tele-typewriter circuits to Europe, Africa, theCaribbean, Australia, and several points inthe Pacific. RCA computers were developedfor test and checkout of the Saturn launchvehicle in the Apollo program.

In 1964, the RCA Service Company wasawarded a contract for the planning, instal-lation. operation, and maintenance of com-municat ions for NASA's Spaceport at Mer-ritt Island, Florida.

The company's military support activi-ties were highlighted by operation andmaintenance of the Ballistic Missile EarlyWarning System, the electronic systemsused on the Air Force Eastern Test Rangeat Cape Kennedy, and the White Alicecommunications system of the Air Forcein Alaska. The company began delivery ofcommunications equipment for the Depart-ment of Defense AUTODIN data commun-ications network in 1964. Delivery con-tinued throughout 1966, and when the proj-ect is completed, the continental portionof AUTODIN will he the most advanceddata communications system in the world,with individual switching stations capableof handling six million messages a month.As one of the leading industrial contrac-tors to the Department of Defense, RCAcontinued to supply a wide range of mil-itary electronic devices and systems. Amongthem were microelectronic receiving equip-ment, various types of radar, secure com-munications systems, laser range findersand related equipment, and mobile radiorelay units.

In 1966, RCA became extensively in-volved in the challenging new area of under-water technology through a three-year con-tract awarded by the U.S. Navy to manage,operate, maintain, and support the Atlan-tic Undersea Test and Evaluation Center(AUTEC) in the Bahamas. AUTEC is a

37

1962496111=11111.1.1111.111M11.1naval facility employing weapons, acous-tic, and sonar ranges located in the deep-

ocean areas south of Nassau.

The international market

Technological progress and rising aspira-tions in most parts of the world between1962 and 1966 created new internationalmarkets for electronic products and servi-ces. This was especially evident in thespread of color television abroad.

In 1964, RCA Victor Company, Ltd., ofMontreal, began the assembly of color pic-ture tubes. In the same year, RCA sent aspecially built mobile unit on a six-monthtour to demonstrate the United States colortelevision system to European governmen-tal authorities. By 1966, RCA's Canadiansubsidiary had substantially expanded itscolor picture tube facility, and had startedconstruction of a new cabinet plant inOntario.

In anticipation of regular color broad-casting in Europe, a new company, RCAColour Tubes, Ltd was formed in Englandin association with the British firm ofRadio Rentals, Ltd., to produce RCA colorpicture tubes for the British and Europeanmarkets.

On the other side of the world, the Phil-ippines became the second Far Easternation after Japan to begin color broad-casting, employing RCA color studio andtransmitting equipment.

In addition to supplying color and black -

and -white television equipment to nationsin Asia, Africa, and the Middle East, manyother RCA products were in use through-out the world.

In 1963, RCA's Canadian subsidiary re-ceived a contract from the Canadian govern-ment for the design and construction ofan advanced satellite communicationsground station in Newfoundland. The sta-tion began operations in 1966. RCA Com-munications, Inc., was selected by the gov-ernment of Thailand in 1966 to install9

Southeast Asia's first communications satel-lite earth station.

During the five-year period, RCA subsid-iaries were active in the Latin AmericanFree Trade Area, exporting electron tubesto this expanding market. The recordingoperations of RCA Italiana, conducted inRome at Europe's most modern recordingfacilities, increased substantially. Two-waymobile radio units were supplied to theHong Kong Ambulance and Fire Service,and to the Singapore Police Department,and NBC reached audiences in 93 coun-tries through the sale of television filmsto government broadcasting authorities.

The continued growth of new opportun-ities abroad led at the end of 1966 to arealignment of RCA's organizational struc-ture to capitalize upon its special skillsfor foreign markets. The change was de-signed to draw the domestic operatingdivisions more directly into RCA's over-seas business in order to make the mosteffective use of the company's resourcesin an expanding world market.

New business areas

M4jor diversification moves were made dur-ing the four-year period to develop posi-tions of leadership in new technology andnew markets, ranging over wide areas ofinformation processing and education.

In 1965, RCA organized a Graphic Sys-tems Division to apply computer and elec-tronic technology to processes used in theprinting industry. The following year theDivision marketed its first two products-the Graphic 70 Videocomp electronic type-setter, and the Graphic 70 Color Scanner,which electronically produced the four ba-sic color separations needed in full -colorprinting. At the same time, a vigorousapplied research and development programwas launched to supply a flow of newproducts.

The company expanded into publishingand took major steps into new areas of

9. In 1966, vapor -deposition equipmentproduced superconductive ribbon used incommercial high -field -intensity magnets upto 100 kilogauss.

10. RCA's Graphic 70 Videocomp set typeelectronically.

11. In 1966 Service Company received con-tracts to operate two Job Corps nviningCenters.

10

38

1962-1966

education. In 1966, Random House, Inc.,became a wholly owned subsidiary of RCA.

The educational facilities of the RCAInstitutes, Inc., were expanded substan-tially. In 1966, the RCA Service Companyreceived multimillion -dollar contracts tooperate two Job Corps Training Centersfor the Office of Economic Opportunity.

In order to coordinate the sale of IVsystems, cameras, learning laboratories, andother equipment to the educational market,RCA formed an Instructional ElectronicsDepartment in 1966. That same year, thenation's largest educational TV system, in-stalled by RCA for the Catholic Archdio-cese of New York, was put into operation,and a similar system serving the MiamiDiocese was extended.

Other new opportunities explored in 1966included an agreement with Hoffmann -LaRoche, a leading pharmaceutical firm,to collaborate in the development of newmedical electronic equipment.

Also in 1966, the company establishedthe Magnetic Products Division to speedthe growth of RCA's business in computerand other tapes for use in industry andthe home.

Finally, late in the year, the Boards ofDirectors of RCA and The Hertz Corpora-tion approved an agreement for the acqui-sition of Hertz by RCA.

Research

Many of the products that so radicallychanged the character of the electronicsindustry between 1962 and 1966 repre-sented the successful application of researchperformed in earlier years in the laborato-ries of RCA.

The company's research and develop-ment activities during the period werescattered widely through the principal operat-ing divisions, spearheaded by theoreticaland applied research at the David SarnoffResearch Center of RCA Laboratories atPrinceton, NJ.

In 1963, and again in 1965, major expan-sion programs were undertaken at the re-search center to increase laboratory facili-ties and to accommodate new researchactivities associated directly with specificproduct divisions of the company.

The research program itself penetratedincreasingly into new areas of basic mate-rials and phenomena, and it produced a

number of significant advances leading tonew devices and technology applicable topresent and future business for RCA.

Extensive research efforts relating to la-sers led to a number of new laser devicesand techniques for employing lasers inpossible future communications systems.A highlight of the program was the devel-opment in 1965 of an argon laser produc-ing the highest power of any visible lightlaser yet known. The device was trans-lated into a new commercial product andplaced on the market by RCA in 1966,RCA's scientists also achieved in 1965 thefirst injection laser to emit visible light atroom temperature.

Continued research in computer memo-ries led to a number of new concepts andtechniques of considerable promise for thefuture. The program followed several dif-ferent lines, including new types of ferritedevices, thin-film techniques, and super-conductive memories. The latter effort a-chieved in 1966 a new technology for mak-ing high -capacity superconductive arraysthat promised to outperform present massstorage electromechanical memory systemsand to compete economically with them.

Experiments in thin-film techniques em-ploying improved photosensitive materialsresulted in an experimental tubeless tele-vision camera. This device employed net-works of thin films of photoconductorsand other semiconductor materials, anddigital scanning techniques, to performthe functions of a pickup tube and pic-ture processing elements in a conventionalcamera.

11

These are highlights of a wide-rangingeffort that also produced new understand-ing of basic phenomena, explored newmaterials for a multitude of device appli-cations, and developed new technologiesfor manufacturing microminiature devicesin large arrays. The results promise tocarry RCA forward in many existing andnew areas of business in the years justahead.

Prospects for the future

In assessing the performance of RCA be-tween 1962 and 1966, and looking aheadat the prospects for continued growth anddevelopment, David Sarnoff told share-holders at the 1965 Annual Meeting,

"In all my years with RCA, I have neverseen our company more strongly posi-tioned for progress than it is today-inpersonnel, in products and services, andin the promise of continuing profitabil-ity. Color, computers, components, andcommunications; broadcasting, service,records, and broadcast equipment areamong the most active contributors tothe country's growth-and they illus-trate the breadth as well as the diver-sity of our strength."

These words were equally appropriateas 1966 drew to a close. Electronics in1966 remained the nation's fastest grow-ing industry, and its most challenging. Nocompany was more determined than RCAto explore the many opportunities for ser-vice that electronics will offer in the yearsahead.

39

211111111fteri

1.-14E6Z

amiansim

ilm1

1. The assembly area in RCA's 250,000 -square -foot equipment facility at Marlboro,Mass.

2. Spectra 70 serving the growing market forremote computing systems.

3. Enlarged view of test circuit probescontacting integrated circuit wafer.


J. Hillier

RCA met the challenge of changing market conditions by aprogram of diversification and emerged as a multinationalcompany with worlawide industrial involvement.

A program designed to modernize the com-pany's identity was completed in 1969 withthe changing of the corporate name fromRadio Corporation of America to RCA Cor-poration. RCA's famed circular trademarkwith its symbolic lightning flash was re-placed by a contemporary design in whichthe three letters form a distinctive singleunit.

In early 1970, RCA established an Officeof Consumer Affairs at the top corporatelevel. It has responsibilities for the safetyand reliability of all RCA products andservices and ensures that consumer inter-ests receive prompt attention at all levelsof the company.

An era came to an end on January 7,1970, when the Board of Directors acceptedthe resignation of General David Sarnoffas Chairman of the Board and a Directorof RCA. At the same time, the Board electedGeneral Sarnoff the first Honorary Chair-man in the Corporation's history. The Boardalso adopted a resolution of appreciation,which stated, in part, that "more than anyother man, David Sarnoff was the archi-tect of RCA's rise to world leadership inelectronics." General Sarnoff was suc-ceeded by his son Robert W. Sanloff.

Computer activities

lid the end of 1970, RCA had made agreater investment in its computer opera -time; than in any previous venture. A majornew peripheral -equipment plant was openedin Marlboro, Mass., in 1969. The followingyear, the Marlboro facility was doubled insize, and plans were announced for a $16 -million office building in that location toserve as the future headquarters for RCA'scomputer activities.

Throughout the late '60s and early '70s,RCA continued to develop new computers,peripheral equipment, and components to

meet the accelerating need for more ver-satile data processing systems. The Spec-tra 70/46 was introduced in 1967 and thelarge-scale Spectra 70/61 two years laterto serve the growing market for remotecomputing systems. These two remote com-puting systems were the first RCA proces-sors equipped with virtual memory, whichmeans that the main computer memorycould be expanded almost limitlesslythrough a series of auxiliary devices andspecially developed software.

However, RCA did not concentrate en-tirely on remote computing. In 1969, thecompany marketed a large-scale Spectra70/60 batch processor designed to handlecredit and reservations systems, automateproduction control, and serve data banks.The following year, RCA introduced a newseries of small- to medium -class compu-ters-the RCA 2, 3, 6, and 7. Two of thesenew processors also have virtual memory.

Progress was also made in electroniccomposition systems. The speed of theRCA Videocomp was increased tenfold in1968, making it possible to set the text ofa novel the size of War and Peace in lessthan an hour. Two later developments fur-ther enhanced its capabilities: the abilityto set complex line drawings and thenposition the drawings on a page togetherwith text and the development of a pro-gram that enables the system to producehalftone photographs composed of smallideographic characters.

Consumer electronics

The domestic color TV boom of the earlyand middle 1960s began to level off in1967 as the industry matured. Neverthe-less, RCA maintained its leadership incolor sales and total domestic consumerelectronics retail volume. In 1969, com-puters began to be used to help design,

41

1966-1971

produce, test, and market many RCA homeentertainment products. The company rec-ognized the potential of the youth marketby highlighting colorful portable modelsthroughout its radio, phonograph, tape re-corder, and television lines.

In 1970, RCA introduced one of themost comprehensive consumer -warranty pro-grams in the industry and instituted amultimedia advertising campaign to pro-mote AccuColor-more accurate, brightercolor with expanded automaticcontrol.

Solid-state components were incorpo-rated in RCA color TV sets frir the firsttime in 1968. By the end of 1971, thesecomponents will have replaced tubes, otherthan the kinescope, in a large number ofRCA color sets.

The RCA line of tape recorders wasexpanded in these years and ranges fromprofessional -type stereo recorders to popu-lar, handheld cassette players.

The company also produced Stereo 8tape decks for car owners in the UnitedStates. Four -channel sound in an eight -track cartridge configuration was intro-duced in 1970, providing a new dimensionin musical realism.

RCA reentered the modular phonographfield in 1969 and added new models invarious price ranges the following year.Late in 1970, RCA began test marketingpersonalized stereo consoles-an innova-tion that permitted the customer to choosefrom among 432 possible combinations ofcabinet, speaker, and stereo components.

Electronic componentsand solid-state devices

In recent years, RUA designed, produced,and marketed thousands of different typesof electronic building blocks for uses that

4

ranged from color TV to manned space-craft. These were also years of technologi-cal change in the electronics industry.The receiving tube, one of the Corpora-tion's oldest component lines, was slowlybeing replaced by products of the newsolid-state technology. To coordinate activ-ity in this field, RCA, in 1970, consoli-dated semiconductor activities into a SolidState Division. A new Solid State Tech.noloa Center was established at Somer-ville, N.J., as a focal point for semiconduc-tor developments throughout RCA and inrecognition of the need for a more inti-mate relationship between the RCA appa-ratus and systems producers and the pro-ducers of integrated circuits.

In 1967, the Corporation reinforced itsposition as the leading supplier of thetriac, a new solid-state device that con-trols electrical operations with great pre-cision and extremely low power consump-tion. These tiny components were used inmany consumer products, including blend-ers, fans, and light dimmers. RCA triacswere also used in electronic scoreboardsand in industrial lighting applications.

The following year, RCA made good prog-ress in the application of microelectron-ics, using silicon monolithic integrated cir-cuits. The company also pioneered the useof integrated circuits in consumer productsand was the first in the industry to adoptintegrated circuits for automatic fine tun-ing in color TV. RCA developed specialCOS/MOS integrated circuits for the ae-ro-space market in 1968, which gave thecompany technological leadership in thefield of low -power, low -speed digital inte-grated circuits.

In 1969, RCA developed a new, highlysensitive silicon -target vidicon through thecombination of solid-state and electron -tube technology. The company also entered

5

1966-1971

4. RCA continued to maintain its leader-ship in color tv sales.

5. TK-44A canera, became the best-sellingcamera in the industry.

6. In 1968 an RCA -built 4 I/2 -lb h' camerawas carried aloft during the first mannedApollo flight

7. The late 60s saw a trend in global com-munications toward increased use of telexand leased channel services.

the digital display market with a Numi-tron readout device bright enough to beread in sunlight. It can be used for gas -pump indicators, desk calculators, cashregisters, and automobile dashboards. In1970, RCA expanded applications of sil-icon power transistors to include anti -pol-lution and vehicle safety systems.

Progress also was made in electron -tube technology. In 1967, new phosphorsprovided RCA color TV tubes with far bright-er highlights than had been formerly pos-sible. Two years later, the Corporation devel-oped a new matrix color tube, twice asbright as any previous RCA tube.

In 1970, RCA developed transferred -electron amplifiers, a new family of mul-tipurpose microwave solid-state devices.These devices, smaller and simpler thanthe traveling -wave tubes, have applicationsin electronic countermeasures; mobile, air-borne, and spacecraft communications; andradar systems for weather and surveillance.

Broadcastingand recording activities

color TN coasett to be a novelty as CBSand ABC followed NBCs lead into full -colornetwork programming. Television becametruly international in scope by 1967, whenNBC arranged the first live color TV trans-missions by satellite to England.

Throughout this period, the NBC-TV Tele-vision Network attracted more advertisersthan any other network. It was also firstin attracting better educated and moreaffluent young adults, the category, mostprized by advertisers. In addition, in eachof the years from 1967 through 1970, NBC-TV received more awards than any otherbroadcast organization: a total of morethan 620, including Emmy and Peabodyawards.

7

NBC News covered the headline -makingstories of these years-the wars in Indo-china and the Middle East, man's firstlanding on the moon, and the assassina-tions of Martin Luther King and RobertKennedy. NBC Sports brought many of thetop athletic events, including the NewYork Mets' victory in the 1969 World Se-ries and the New York Jets' upset win inthe 1970 Super Bowl, into the nation'shomes.

NBC expanded its overseas operationsand, by the end of 1970, was providingprograms to 114 nations. That year, Bonan-za, the world's most popular TV series,had an estimated weekly audience of morethan 400 million people in 83 countries.

RCA Records, which became part ofNBC in 1969, made a number of artisticand marketing advances during this period.The Philadelphia Orchestra and its dis-tinguished conductor, Eugene Ormandy,returned to the Red Seal label.

Commercial services

Commercial and technical service volumeof the RCA Service Company reached newpeaks each year between 1967 and 1970.New branches were added to the nation-wide network offering factory service toowners of RCA products, bringing the totalto 180 by the end of 1970.

Commercial TV service activities alsoincreased, largely because of the risingrate of conversions to color receivers byRich institutions as hospitals, nursinghomes, and hotels. In 1970, RCA reducedthe cost of these conversions by designinga color installation compatible with exist-ing black -and -white wiring.

The Service Company also handled main-tenance and installation for RCA commer-cial communications products and provided

1966-1971

service for other manufacturers and largeusers of such equipment. In 1969, it in-stalled the hardware and provided reme-dial maintenance for more than 3000 res-ervations systems terminals at leading hoteland motel chains. The following year, tech-nical maintenance services were extendedfor credit verification and airline reserva-tions systems as well as data communica-tions equipment. Also in 1970, RCA beganto lease teletype equipment for both com-puting and communications uses.

Global communications

The rapid expansion of world businessand the need for greater interaction amongnations spurred the growth of global com-munications during the later 1960s. Toserve this need, RCA Global Communica-tions was operating more than 2500 chan-nels of various bandwidths by year-end1970, nearly twice as many as were in usefive years before.

The nature of the industry began tochange during this period, with a pro-nounced trend toward increased use oftelex and leased -channel services. Part ofthe reason for this was the development ofnew technological advances that permit-ted broad -based, tailor-made customer ser-vices at lower costs. For example, in 1967,RCA introduced AIRCON, a unique remotecomputing application that permitted com-panies that have their own private tele-printing network to plug in to a mastercomputer for automatic relay of messages.The following year, RCA customers wereable to use international voice -grade chan-nels for simultaneous transmission of tele-graph and voice, facsimile, and data com-munications over the same link.

In 1969, RCA inaugurated the Computer8

Telex Exchange, which provides interna-tional telex communications within sevenseconds and reduces the possibility of ermr.Another new service, Interpolated VoiceData, allows two-way voice conversationon a circuit at the same time that dataflows at high speeds in both directions.During pauses in conversation, the circuitinstantly switches from the voice mode todata transmission. Also in -1969, the Exec-utive Hot Line was opened between NewYork City and San Juan, allowing a busi-nessman in his Manhattan office to estab-lish immediate contact with an associatein Puerto Rico merely by lifting the handsetof his special telephone.

Commercial and industrial productsThe market for broadcasting equipmentexpanded in the late 1960s under theimpetus of increasing conversions of 'TVstations to color, a strong replacementmarket, and the opening of new uhf sta-tions. However, after three consecutive peakyears, domestic booking waned in 1970largely because disappointing general busi-ness conditions resulted in a decline in'IV advertising revenue, forcing broadcast-ers to defer purchases of major equipment.

Throughout this period, RCA continuedto be the leading supplier to the broad-cast industry. In 1968, for example, 55 uhfstations went on the air for the first time,and RCA provided transmitting equipmentfor more than half of them. The companystrengthened its leadership that year withthe introduction of the TK-44A camera,which can take acceptable color picturesat only 15 footcandles, a light level toolow for reading. Within two years, it becamethe best-selling camera in the industry.

In 1969, the Corporation introduced a

8. RCA Alascom terminal.

9. The advanced vidicon camera systemdeveloped for NASA by RCA for the Nimbusweather satellite.

10. A new laser technique made hologramsof large stationary objects possible.

11. RCA broadcast equipment at a new uhfstation in Trenton.

1966-1971

10

30 -kW uhf transmitter that improved thetechnical quality of TV transmissions by amargin of two to one. RCA also continuedto be the prime supplier of multiple -an-tenna systems for TV broadcasting. In 1970,two tower antennas were installed on the100 -story John Hancock Center in Chicago,and an agreement was signed to constructan antenna stack atop Mt. Sutro for SanFrancisco TV stations.

RCA technology was also part of thenew age of aviation. Most of the major air-lines, including Pan Am and TWA, selectedRCA weather radar for installation in theirnew fleet of Boeing 747 jets and other air-craft. The TWA order, placed in 1968, wasthe largest single purchase of weather radarequipment in airline history. In addition,RCA navigation/communications systemswere standard equipment on many busi-ness and commercial jets.

In other areas, RCA expanded its mobiletwo-way radio line in 1970 with medium-priced systems designed to serve the grow-ing communications needs of smallbusinesses.

Space and defenseWhen astronaut Neil Armstrong steppedfrom the Apollo 11 Lunar Module onto themagnificent desolation of the moon, hisRCA -produced man -pack radio was his elec-tronic link to home. It carried his historicfirst words across 225,000 miles of spaceto the world and on to posterity.

The radio was only one of the importantRCA contributions to the Apollo programduring the five-year period. In 1968, a tiny

11

TV camera designed and built by the com-pany for the Apollo 7 mission sent backthe first live pictures of astronauts aboarda U.S. spacecraft. Another RCA cameraflew on Apollo 8, man's first voyage to thevicinity of the moon. On the later Apollomissions, RCA was responsible for the ren-dezvous and landing radars that helpedguide the astronauts in the LM to andfrom the lunar surface, as well as the atti-tude and engine control assemblies thataided them in making pinpoint landingson the moon. The RCA LM communica-tions system enabled the astronauts tomaintain continuous voice contact withearth, and the vhf communications/rang-ing system kept the LM in constant touchwith the Command Module when the twospacecraft were separated in flight. TwoRCA countdown computers at Cape Ken-nedy provided critical ground support forthe moon mission, monitoring 3000 func-tions of the Saturn 5 rockets prior tolaunch.

RCA also has played a key role in develop-ing spacecraft and systems for the nation'sunmanned space program. RCA power sup-ply and communications equipment wasaboard all three Lunar orbiter spacecraftthat, in 1967, completely mapped the lunarsurface.

The company was also the nation's lead-ing developer of meteorological satellites.By year-end 1970, more than 1.5 milliontelevision pictures had been returned fromspace by RCA -built satellites, most of themfrom liros/ESSA weather satellites. In 1970,the first two in a series of RCA -built ITOSsatellites were placed in earth orbit. These

45

1966-11.111111111111111111.111111111111111larger, more sophisticated, second -genera-tion spacecraft provided improved cover-age of the earth's weather systems.

In another program, operational Transitsatellites built for the Navy provided shipsat sea with the most accurate navigationalaid in history.

RCA provided the high resolution returnbeam vidicon TV cameras, power subsys-tem, command receiver and ground sys-tem support for the Landsat satellites (for-merly called the Earth Resources Tech-nology Satellites). The Landsat program isa demonstration of using remote sensingdevices for surveying the earth and man-aging its natural resources. The RCA -builtcamera system is the highest resolutionTV system ever to be flown for NASA inspace.

RCA, in 1969, was assigned responsibil-ity for the development of the Navy's newAEGIS advanced surface missile system,and the preliminary design for the com-mand and launch segments was completedin 1970. The $253 -million contract was thebiggest for RCA in more than a decadeand might develop into the largest defensecontract ever received by the company-possibly more than $1 billion. Other mil-itary projects during the five-year periodincluded the study and development of anadvanced airborne command center, over -the -horizon radars, and a robot sailboatthat can be navigated by radio commandto any point on the world's seas.

Leasing and rentingIn recent years, American motorists havelogged several billion miles annually inautomobiles they do not own. They werecustomers of one of the faster growingsegments of the service industry-vehicleleasing and renting. In 1967, The HertzCorporation, the largest company in thisfield, became a wholly owned subsidiary

12

of RCA. By the end of December 1970,150,000 cars and trucks were operated byHertz and its licensees in the United Statesand 107 foreign countries. Hertz servicewas available at nearly 3000 locations inmore than 1900 cities. Hertz and its sub-sidiaries also leased and rented construc-tion, commercial, and industrial equipmentand operated parking and expositionfacilities.

Late in 1968, Hertz unveiled a new ser-vice approach for the air traveler-theSky Center at the Huntsville, Ala., jetport,where transportation, lodging, business, bank-ing, and recreational facilities, all oper-ated by Hertz, are housed under one roof.In 1970, arrangements were completed forHertz to build and operate a hotel/motelcomplex at the Jacksonville, Fla., airport.

Overseas, Hertz reached an agreement withSoviet officials in 1969 to make auto ren-tal available in several major Russian cit-ies. Earlier that year, Hertz service wasestablished in Romania and Bulgaria.

Hertz Equipment Rental Corporationentered the foreign market in 1970 withits new subsidiaries, Air Mac InternationalCorporation and Air Mac Philippines, Inc.These concerns operate construction -equip-ment locations in Singapore, the Philip-pines, and Seattle, Wash.

Research and developmentDuring the five-year period, thousands ofscientists, engineers, technicians, and sys-tems people at RCA laboratories in Prin-ceton, NJ., Montreal, Tokyo, Zurich, andthe product divisions provided the Corpora-tion with viable technical alternatives onwhich to base future profit. These involvednot only the discovery of new concepts andproducts but also the evaluation of techni-cal achievements made elsewhere.

Some of this activity was devoted to the

.aiiMMIINNIMINIIIM111110111ww

13

46

1966-1971

12. In 1968 Hertz unveiled a new serviceapproach for the air traveler-the Sky Cen-ter at the Huntsville, Ala., jetport.

13. The Random House Dictionary of theEnglish Language was the first major newdictionary in many years.

14. Banquet Foods became a wholly ownedsubsidiary in 1970.

15. A speech therapy session at a KeystoneJob Corps Center.

14

tt

411111 101<L

)

a air

realization of the promise of the laser. In1967, RCA combined television and lasertechnology, for the first time for transmis-sion and recording of images. This systemused a 'IV camera tube that sent its pic-tures to a gas laser, whose beam tracedthem on phothgraphic film. The same year,a new laser technique was developed thatmade it possible to produce holograms oflarge stationary objects. In 1968, RCA'sresearch in the control of light led to thedevelopment of the world's first hologra-phic computer memory. Such memoriesare capable of storing large amounts ofdata in a very small space and are rela-tively immune to the effects of dust andscratches. The following year, RCA unveileda laboratory model of a laser -based homevideo player. RCA plans to market a var-iety of home video player systems duringthe next decade under the SelectaVisiontrade name.

RCA scientists also developed galliumarsenide lasers-the most efficient solid-state lasers ever built.

One of the most important RCA researchadvances during this period was using liq-uid crystals for electronic control of thetransmission and reflection of light. Liq-uid crystal products of the future mayrange from instrument displays for auto-mobile dashboards to flat -screen TVreceivers. Other achievements included theharnessing of an electronic "avalanche"within silicon diodes to produce the mostpowerful solid-state microwave generatorsever built and the development of the sil-icon storage vidicon camera-a compact'IV camera with stop -action capabilities.

15

SPEECH

HEARING

In 1967, RCA Laboratories' Tokyo branchmoved into new research laboratories justoutside that city. Research there is con-centrated on magnetic materials, semicon-ductors and semimetals, plasma physics,and communications theory.

Publishing

From Rosemary's Baby in 1967 to TheGreening of America in 1970, RandomHouse titles were consistently representedon the best-seller lists. However, the achieve-ments of RCA's publishing subsidiary werenot limited to the trade book division.

The commercial and critical success ofthe Random House Dictionary of the Eng-lish Language, published in 1966, led tothe publication of a college edition in1968 and an elementary school version in1970, Random House maintained its posi-tion of leadership in children's books withthe introduction, in 1968, of The Brightand Early Books by Dr. Seuss.

To meet the changing requirements ofmodern education, Random House inaugu-rated a series of instructional materialsfor classroom use. Important multimediaprograms were developed in all major lan-guages and involved textbooks, audio tapes,and film strips. Supplementary materialswere designed that offered individualizedinstruction for students at all grade levelswho had difficulty in reading and mathe-matics. Efforts also were directed at thejunior -college and community -collegelevels-the fastest growing segment of thecollege textbook market.

New business activities

During the 11e -!,ear period, RCA followeda flexible growth policy of diversificationand expansion of present activities, selec-tive new business ventures, and increasedemphasis on marketing to assure a soundbalance between manufacturing and ser-vice business. With all these changes, how-ever. RCA remained basically an electron-ics and communications company-withapproximately 75 percent of its productsand services concentrated in these areas.

In addition to The Hertz Corporation,two other companies became wholly ownedsubsidiaries during this period. BanquetFoods, Inc., formerly the F. M. StamperCompany-a leader in the frozen preparedfoods industry-became an RCA subsidiaryin March, 1970. The same year, RCA ac-quired Cushman & Wakefield, Inc., one ofthe nation's leading commercial real es-tate firms. Cushman & Wakefield's opera -

47

1966-1971

tions encompass project consultation, officeleasing, building management, site improve-ment and development, sales, and apprais-al. In late 1970, an agreement for mergerwas reached with Coronet Industries, Inc.,of Dalton, GA. Coronet's activities rangefrom the manufacture of floor and wallcoverings and commercial, residential andinstitutional furniture to the fabrication offoams, plastics, and other materials.

RCA's managerial and technical capabil-ities were directed increasingly toward theimprovement of public education and train-ing in the United States. During this period,the Corporation received contracts to oper-ate the Keystone Job Corps Center forWomen in Pennsylvania and the ChoanokeArea Development Center for seasonal farmworkers and their families in North Caro-lina. And in 1970, RCA received a U.S.Department of Labor contract to operate aresidential Job Corps Center for the train-ing of underprivileged youth in New YorkCity. The same year, the company con-tracted to direct a federally funded pro-gram aimed at upgrading the public schoolsystem of Camden, NJ.

In 1969, a new growth opportunity forRCA opened in the northernmost state,when the U.S. government accepted RCAGlobcom's bid to purchase and operatethe Alaska Communication System. Planscall for a telephone rate reduction thatwill save the people of Alaska some $40million during the first three years of opera-tion. By the end of 1970, RCA Alaska Com-munications had already built a microwavesystem and a tropospheric and microwave

16

link and initiated direct -distance -dialinginstallations in Anchorage, Fairbanks,.Juneau, and Ketchikan.

RCA capitalized on the increasing needfor prompt, quality service by launchingService America, a new organization toservice all makes of TV sets and otherhome entertainment products. Ten Service -America centers were opened during 1970-five each in the Philadelphia and SanFrancisco areas.

In manufacturing, RCA entered the glassbusiness in 1970 with the completion of a$19 -million plant in Circleville, Ohio, forthe manufacture of glass funnels and face -plates for large -screen color TV picturetubes.

International operationsRCA also embarked on a program of globalexpansion during these five years. In 1967,a new approach to international marketingand manufacturing was formulated, witheach major division given worldwide respon-sibility for its products and services. At thesame time, a corporate staff function wasset up to coordinate international activi-ties. In 1968, a distribution center wasestablished in Hong Kong to serve the FarEast market. The same year, RCA Housewas opened in London as a headquartersfor administrative and marketing func-tions in Europe, the Middle East, andAfrica. Other activities in the United King-dom during the period have included thebuilding of a new facility on the Isle ofJersey for commercial product activities in

16. An engineer at RCA's Missile and Sur-face Radar Division, Moorestoum,supervises space chamber tests of a foldingantenna of the kind that will transmit colorTV and other communications from Apollo 15astronauts' Lunar Rover "space taxi" as itroams the moon. The antenna, with spinedsections of gold mesh, opens and closes likean umbrella.

48

1966-1971

17. An assembly jig being removed from anelectron gun being made al RCA's plant in!uneasier, ftc. When the electron guns in theforeground are completed, they will aid in'painting" images on the face of eolor televi-sion picture tubes.

18. NBC control room during live coverageof Apollo mission in 1969.

17

the European market and the constructionof a solid-state applications engineeringand test center at Sunbury -on -Thames. Arecord -pressing facility was built at Wash-ington, in Yorkshire, and a magnetic pro-ducts plant at Bryn Mawr, Wales.

In 1970, RCA constructed a $10.7 -mil-lion semiconductor manufacturing plantin Liege, Belgium, This marks RCA's firstelectronics manufacturing facility on theEuropean continent.

A facility was opened in 1967 on Tai-wan for the manufacture of integrated cir-cuits and memory planes. Later, the plantwas enlarged for the production of certainconsumer electronic products. In 1970, a49 percent interest was obtained in a newTaiwan company for the manufacture ofblack -and -white picture tubes for world-wide distribution.

In Canada, RCA opened a new colorpicture tube plant in Midland, Ont., in1967 and announced plans for the con-struction of large new recording studios inMontreal. A year later, RCA entered theCanadian computer market with the open-ing of sales offices in Montreal and Torontoand the installation of a Spectra 70 datacenter, also in Montreal. Early in 1970,

RCA Limited (Canada) moved into its newcorporate headquarters at Ste. Anne -de -Bellevue, Que., on the outskirts of Montreal.

RCA was active in Mexico. The Corpo-ration acquired Dispositive ElectronicosS.A., a producer of receiving tubes for salein Latin America. In 1969, a new Mexicancorporate headquarters was established in

18

Mexico City. A color picture tube assem-bly plant in Mexico City and a consumerelectronics subassembly facility in Ciudad.Juarez also began operations. The sameyear, a computer data center was openedin Mexico City for the marketing of elec-tronic data processing equipment in thatnation.

During this time, The Hertz Corporationgreatly expanded its international opera-tions. Its volume outside the United Statesand U.S. possessions increased an averageof :30 percent a year during the five-yearperiod ending in 1970.


In his 1970 year-end statement to share-holders, Chairman Robert W. Sarnoffsummed up the major goals of RCA.

"Looking ahead through the 1970s, ourprogram for progress aims for these majorgoals:

Planned growth in areas of high profitpotential, with particular emphasis uponservices; and

Leadership in an expanding consumermarket that is being profoundly alteredby new technolo* and changing tastes.

As we move beyond the current periodof economic adversity, the steps now beingtaken to achieve these objectives shouldposition RCA for a new cycle of growthand profitability greater than any it hasknown in the past."

2

1. Lift-off of Saloom

2. RCA entered the home videotape marketwith the SelectaVision video cassette recorder.


J. Hillier

No oter period since the Great Depression affected RCA asseverely as the recession of 1974-1975. Despite this, thecompany emerged at the end of 1S76 leaner, stronger,and continuing to grow.

The years 1971 through 1976 were diffi-cult, and, in some instances, even trau-matic for RCA Corporation. David Sarnoff,the man who personified RCA and led thecompany during most of its growth into amajor international corporation, died in1971 after 15 months of incapacitatingillness. That same year, the Corporationwithdrew from the general-purpose com-puter business. During the recession yearsof 1974 and 1975, the company's profitsdipped to $113.3 and $110.0 million, respec-tively, compared with profits of $178.3 mil-lion in 1973 and 172.0 million in 1976.Lastly, between the end of 1975 and Sep-tember 1976, the company's top manage-ment was changed twice.

Yet, as this was being written, (year-end, 1977) the Corporation reported thebest year in RCA's 58 -year history. At theend of the six -year reporting period, RCAemerged leaner and stronger in the overalldeployment of its financial, material, andmanagerial resources. It overcame its dif-ficulties and is continuing to grow andprosper.

Resolute management,RCA's scientific resources, andthe nonelectronic subsidiaries helpedin renewing economic growth.

There are many reasons for RCA's renewedgrowth in 1977 despite the adversity itfaced a few years before 1976. A resolute,cost-conscious management that enforcesprofit objectives is an obvious and domi-nant factor. Management however neededthe proper tools. Certainly, one of thesetools was the scientific resources that havemade RCA a pioneer and innovator inelectronics for almost 60 years. The non-electronic subsidiaries acquired during thepast decade or so also gave RCA indispens-

able support through these trying years.As a group, the diversified businesses

withstood the recession years of 1974 and1975 far better than RCA's electronic busi-nesses, which suffered sharp declines insales and profits, especially in TV receiv-ers, picture tubes, and solid-state compo-nents. As 1975 came to a close, however,it became evident that major thrusts wouldcontinue to be based on products andservices arising out of the company'sstrengths in electronics research, devel-opment, and production. This was typifiedby the increasingly close and coordinatedrelationships between RCA Laboratories andthe product divisions. Among the benefitsof these improved relationships were in-creased production efficiency, a heightenedawareness of market needs and opportuni-ties, and the emergence of cost-effectivenew and improved products and servicesto meet these needs and opportunities.

It is not possible here to go deeply intoall that happened in the Corporation dur-ing the 1971-1976 period. Furthermore, thisarticle is written for the engineers andscientists who made up the Corporation'sresearch and development activities, andthe emphasis will be placed in the R&Dareas, though other areas will be men-tioned to provide the proper perspective.

One example of RCA's renewed empha-sis on R&D innovation came in the secondhalf of 1975 with the introduction by RCAConsumer Electronics of its new all -solid-state Coloffrak television receivers. RCA,which had led the industry into color tele-vision 25 years earlier, reasserted its lead-ership with a receiver that incorporatedseveral major technical advances. Threeoperations of RCA-Solid State, PictureTubes, and RCA Laboratories-worked withConsumer Electronics in developing theColoYl'rak system, which the Company ex-pects will be the industry standard in per -

51

1971-1976

formance and picture quality for some timeto come.

At the end of 1975, RCA launched itsfirst RCA Satcom domestic communicationssatellite, the nation's most advanced andcost-effective communications satellite. TheRCA Satcoms are a 24 -channel designedspacecraft providing commercial commu-nications to Alaska, Hawaii, and the con-tiguous 48 states. RCA Satcom II was suc-cessfully launched in March 1976.

As the 1971-1976 period was ending,RCA Laboratories and the Solid State Di-vision were exploiting its microprocessortechnology and expertise leading to theintroduction in 1977 of the COSMAC VIPhome computer kit.

Still in the development phase at RCALaboratories and Consumer Electronics isthe SelectaVision Videodisc system, whichprovides for the playback of recorded colorTV entertainment, educational, and othermaterials from a disc, similar to an audiorecord. One major problem to be solvedbefore a decision can be made whether tomarket the videodisc system is develop-ment of a diversified supply of prerecordedprogram material. Meantime, RCA enteredthe rapidly growing home videotape marketwith the SelectaVision Video Cassette Re-corder, supplied by the Matsushita Elec-tric Industrial Company, Ltd.

Consolidation, divestiture, and changesin leadership marked this time span.The growth and development that markedthe end of the 1971-1976 period were pre -

3

ceded by consolidation and adjustment tonew circumstances. In the second half of1971, RCA withdrew from the general-pur-pose computer business. Adverse businessconditions, a uniquely entrenched compe-tition, and the need for continued massiveinfusions of capital led to this decision byRCA. A major result of this decision wasan extraordinary one-time aftertax chargeof $250 million. The decision terminatedthe long-term critical drain on the com-pany's resources and led to the freeing ofmanagement and technical skills as wellas funds for the company's expandingoperations.

During the 1971-1976 time frame, RCAdiscontinued or divested itself of severalother businesses that had become techno-logically obsolete or marginally profitable,or were operating at a loss. The companywent out of the audio products businessin 1975. The major divestitures includedthe receiving tube operations at Harrison,N.J.; other divestitures involved the Graphic Systems Divisions, RCA Institutes,16 -mm projectors, West Palm Beach Di-vision, Microwave Devices, and the govern-ment activities of RCA Ltd. in Canada.

RCA acquired Coronet Industries, a lead-er in the carpeting field in 1971, but in1977, Shelby Williams Inc., a furniture sub-sidiary and J. Josephson, Inc., a wall -cov-ering subsidiary of Coronet, were sold. Otheracquisitions included Oriel Foods Limited,Monis & David Jones Limited, United King-dom food companies, in 1974.

With divestment, acquisition, and other

corporate changes in the six -year periodcame realignment and reorganization ofthe company's activities.

In 1975, Robert W. Sarnoff, who hadsucceeded his father as Chairman of theBoard five years earlier, announced hisresignation from that position at the endof the year. His successor, Anthony L. Con-rad, resigned in 1976 after telling the Boardthat he had failed to file personal incometax returns for the years 1971 through1975, though substantial taxes had beenwithheld from his compensation. Mr. Con-rad's failure to file was not related to thecorporation's business.

Edgar H. Griffiths, who joined RCA in1948, and rose through a succession ofexecutive positions to become responsiblefor all of RCA's electronics and diversifiedbusinesses, was elected President andChief Executive Officer of RCA Corpora-tion in September 1976.

Consumer electronics

XL -100 and ColorTrak were pacesettersfor the industry.

In 1971, RCA introduced the XL -100 tele-vision receiver series, the industry's broad-est line of color receivers with a 100 -per-cent solid-state chassis. In 1975, it intro-duced ColorTrak, the latest and most ad-vanced of the XL -100 series. Among itsadvances, the ColorTrak system includes apicture tube with light -absorbing phosphorsthat provide blacker blacks and more vividcolors under strong ambient lighting con-

4

3. Prerecorded tapes are monitored at RCARecords.

4. ColorTrak automatically tracks bright-ness and hue.

1971-1976

ditions; special circuits for color -contrasttracking; circuits that automatically trackbrightness and hue to compensate for vary-ing broadcast and room lighting conditions;as well as general improvements in sharp-ness, resolution, signal-to-noise ratio, color-imetry, and tuning. In 1976, ColorTrak'sfirst full year as a complete line, it wonstrong acceptance by consumers and ac-counted for 42 percent of RCA's total dol-lar sales in color television.

Black -and -white television also sharedin the product development program withthe introduction of a completely redesignedline-the company's first total productline change in 28 years-featuring port-able sets designed to appeal to a youthful,mobile market.

With the closing of the company's Mem-phis, Tenn. plant in 1971, RCA's domesticTV manufacturing was consolidated in twofacilities at Bloomington and Indianapolis,Ind. At the same time, construction of anRCA Design Center was begun in Indiana-polis to provide greater emphasis on innova-tive design in future consumer products.

RCA continued to increase sales of theXL -100 solid-state series, and in 1973 soldmore color TV sets than in any previousyear. The following year, RCA became thefirst full -line U.S. manufacturer to devoteits TV production exclusively to 100 -per-cent solid-state receivers. At the same time,it achieved significant production econo-mies by streamlining its color line to 31

5

5. COSMAC microprocessor contains up to600 transistors.

6. Current tv model sits atop first mass-produced set turned out by RCA in 1946.Original model weighed 85 lb. New 20 -lbmodel has a built-in battery.

O-

models employing fewer basic chassis de-signs. Comparable model and chassis reduc-tions were made in 1975 in the new black -

and -white "Sportable" TV line.In mid -1974, RCA announced that the

newly introduced line of radios, phono-graphs, and tape players would be its last.Audio products had declined to 5 percentof RCA's consumer electronics business,and, in a highly fragmented and crowdedfield, had lost their profitability.

Reco.ds and tapesRCA Records increased its market shareboth here and abroad.

RCA Records continued to strengthen itsindustry position with advances in mar-keting, overseas operations, and artists andrepertoire. In 1976, for the second con-secutive year, RCA Records achieved thelargest sales and profits in its history.

In the early 1970s, RCA Records tookover its own direct distribution enablingit to serve the bulk of the U.S. marketthrough its own outlets. This resulted ingreater market penetration. New licenseeoperations and subsidiary companies insuch countries as France and West Ger-many increased foreign sales significantly.In 1975, RCA Records entered into a jointventure with the Victor Company of Japan,Ltd giving it greater growth potential inthe world's second-largest record market.

6

"The Sound of Music" continued to bethe biggest selling album in recording his-tory, and Van Cliburn's performance ofTchaikovsky's Piano Concerto No. 1 becamethe first classical record to sell more thana million copies. Popular artists such asJohn Denver, David Bowie, and the Jeffer-son Starship achieved peak records sales.In the classical field, Vladimir Horowitz,who rejoined RCA artists in 1975 after a13 -year absence, had his first new albumrelease late in 1976.

Picture tubes

RCA became a fully integrated producerand increased sales.

The decline in demand for receiving tubes,resulting from the growth of solid-statetechnology-an 80 -percent reduction in tenyears-influenced the decision to realignthe constituents of the RCA ElectronicComponents Division. One result was theestablishment in 1975 of the RCA PictureTube Division to take over the principalactivities of the former Entertainment TubeDivision.

WAWA

53

1971-1976

In 1971, picture tube engineering em-phasis centered on the development ofthe 25 -inch 110 -degree delta color picturetube primarily for the international market,RCA's Circleville, Ohio, glass plant beganproduction of panels and funnels for colorpicture tubes. Thus, RCA became the firstdomestic TV producer to be fully integratedfrom sand to receiver.

The same year, color picture tube pro-duction was consolidated at Marion, Ind.and Scranton, Pa., and completely curtailedat the Lancaster, Pa. plant. Black -and -whitetube production was discontinued. A newplant for the manufacture of shadow maskswas dedicated at Barceloneta, in PuertoRico.

RCA and the Thomson Group in Francealso joined in 1971 to form Videocolor S.A.with color tube manufacturing facilities inAnagni, Italy. A joint venture with ThornElectrical Industries, Ltd. also saw thestart-up of production in Skelmersdale, Eng-land. (Early in 1976, the decision wasmade to discontinue the joint venture withThorn, Ltd., because of continuing lossesand adverse economic conditions abroad,especially in the United Kingdom.)

In 1972, RCA announced its new Preci-sion In -Line color -TV tube system designedfor lower cost solid-state portables. Thistube provides economy during factory as-sembly of receivers, superior performance,and reliability for the consumer. The sys-tem incorporates an advanced -design elec-tron gun, a factory -positioned yoke, andline -screen picture tube.

In 1974, the Precision In -Line conceptwas expanded to include large -screen sizeswith 110 -degree deflection, thus offering

7

savings to European TV set manufacturersin circuitry and labor costs while main-taining excellent picture quality. While110 -degree PIE (Precision In -Line Euro)was the popular product for European cus-tomers, the highly competitive U.S. marketreflected demands for still further econo-mies. This, coupled with the power crunch,resulted in a change of direction awayfrom the higher cost 110 -degree systemsto the lower cost 90 -degree systems.

Despite the adverse economy in 1975,RCA increased its share of the color tubemarket, The Picture Tube Division intro-duced, as part of RCA's new ColorTrakreceiver, a new high -contrast phosphor pic-ture tube that provided a contrast ratioimprovement of approximately 25 percentover conventional phosphor tubes, and re-duced reflections under high -ambient lightconditions. For the international market-place, 110 -degree PIE engineering improve-ments included development of a quickheat gun and a new tube geometry systemwhich resulted in improved color purityand white uniformity from turn -on throughthe warm-up cycle. This 25 -inch 110 -degreePIE system was to be carried into domes-tic production intended for export, and atVideocolor's Anagni, Italy, plant.

In 1976, the Picture Tube Division en-tered into a long-term technology transfercontract with the UNITRA agency of thePeople's Republic of Poland. This contractincluded the installation of complete colortube manufacturing facilities capable ofproducing up to 600,000 picture tubes peryear. The 21 -inch 110 -degree PIE tube typewas designated as the type to be pro-duced in this new facility. The plant is

expected to be operational in 1979.1976 also saw the introduction into the

European Market of the 21 -inch (diago-nal) 110 -degree Precision In -line, self -con-verging tube. This tube, along with the 25 -inch tube which was introduced in 1975,has received good acceptance in Europeand has helped to increase our share ofthe market.

Solid state devices

Microprocessors became theelectronics brains of an increasingrange of products and services.

During the first half of the 1970s, RCAcontinued as a leader in semiconductorpower devices, offering the industry's broad-est line. Although power devices are themature segment of the semiconductor busi-ness, the Solid State Division averaged 15to 20 new types each year. RCA also ledthe way in establishing semiconductor elec-tronics in the automotive market, enjoyingthe largest market share for applicationsother than car radios and tape players.

In the early 1970s, RCA paced the indus-try in introducing a new digital technolo-gy-COS/MOS. In 1974, the Solid State

8

7. CCD image sensor shown on the tv screenis the heart of the tubeless lv camera deve-loped by Electro-Optics.

8.21 -inch 110 -degree Precision In -Line colorpicture tube system.

1971-1976

Division produced the industry's first com-bination of MOS and bipolar semiconduc-tor technologies on a single chip, as wellas introducing the first linear COS/MOScircuits for higher performance in controlfunctions. By late 1975, with the announce-ment of 40 new integrated circuits of itsCD4000 series, the Solid State Divisionhad more than 180 standard commercialcircuits in the COS/MOS series, plus morethan 100 custom circuits, the widest linein the industry of such low -power devicesfor computers, communications equipment,and industrial controls.

In 1975 Solid State introduced COSMAC,the industry's first COS/MOS microproces-sor, the central processing unit of micro-computers. In 1976 a single -chip versionand support circuits were announced. Theseunits are capable of operating over extremeranges of temperature, and in hostile indus-trial, consumer, and automotive environ-ments. They are highly resistant to elec-trical interference, and highly tolerant toa wide power supply voltage range.

Another 1975 innovation was the intro-duction of the industry's first integratedcircuits with hermetic performance in alow-cost plastic package compared withthe more expensive hermetic ceramic ormetal packages.

The first half of the decade also markeda significant expansion of the Solid StateDivision's production facilities. In 1971, itopened a semiconductor plant in Belgiumto serve the Common Market. In 1974, itbegan assembling power devices and inte-

9

9. Universal color test jig distributed byD&SPD.

10. NBC switching central.

grated circuits in its new plant in Malay-sia. In 1975, it undertook the assembly ofsemiconductors in Brazil for the Latin Ameri-can market. Early in 1976, the Divisionbegan production of LSI solid-state devi-ces in a new wafer fabrication facility inRCA's Palm Beach Gardens plant.

Together with the rest of the semicon-ductor industry, the Solid State Divisionwas severely affected by the 1974-1975 reces-sion. This was compounded by excess indus-try capacity and heavy price competitionwhich occurred simultaneously with risingcosts. Conditions began to improve in late1975, and by 1976 the division was againshowing a profit.

Electro-Optics and Devices was devel-oping vidicons, all -solid-state tubelessblack -and -white TV cameras, andlasers.

As a consequence of the realignment ofRCA Electronic Components in 1975, theIndustrial Tube Division became part ofthe Solid State Division under the newname of Electro-Optics and Devices.

In 1972 the Electro-Optics group withinthe former Industrial Tube Division enteredthe rapidly growing CCTV (closed-circuittelevision) market with television camerasand associated equipment designed notonly around the conventional vidicon butalso with the silicon vidicon. and with theSIT (silicon intensifier target) tube forvery low light level TV surveillance. Thesedevices also have been successfully mar-keted as components.

Three years later, in 1975, Electro-Opticsand Devices demonstrated two all -solid-state, tubeless black -and -white TV cameras.The heart of the camera was the world'shighest resolution and largest charge -coupled device (CCD) television image sen-sor. Subsequently, fully standard U.S. 525 -

line compatible video was demonstratedin both black -and -white and color CCD TVcameras.

In another area, Electro-Optics continuedto lead in the development of photomul-tiplier tubes, particularly for such medicalapplications as the Gamma camera andCAT scanners. Solid-state lasers and detec-tors were developed and marketed for mil-itary and commercial fiber-optic communi-cations.

Receiving tubesThe steady shift to solid-state devices innearly all electronic products, and theconsequent steady decline in the receiv-ing tube business resulted in RCA closingits receiving tube plant at Harrison, NJ.,in April 1976.

Distributor and special products

This newly -created division providedgreater economy of operation, more effi-cient distribution, and a birthplace forseveral new products.

In 1975, RCA Corporation dissolved itsElectronic Components Division at Harri-son, NJ. and created two new divisions:Picture Tubes and Distributor and SpecialProducts. At D&SPD, RCA merged the prod-uct lines and distributor network of theformer Electronic Components organizationwith those of the Parts and AccessoriesDivision in Deptford, NJ.

This unified division, having its ownmarketing, sales, financial, and warehous-ing functions, became responsible for theworldwide distribution of replacement partsfor RCA products: receiving tubes; indoorand outdoor TV antennas, rotators, antennahardware and related accessories; car radi-os, tape players and speakers; scanning

1971-1976

receivers; as well as other miscellaneousand related accessory products. In addi-tion, the new division became responsiblein the distributor market for a completeline of TV picture tubes, certain replace-ment semiconductors, industrial tubes andclosed circuit TV cameras.

In mid -1976, RCA reentered the rapidlygrowing citizens band radio field with itsCo -Pilot CB line. When the industrychanged to 40 channels in January 1977,RCA unveiled a full -line of new citizensband products including mobile and basestation units.

In February 1977, RCA began to test marketa microprocessor video game named Stu-dio II, which is based on the RCA -de-signed CMOS 1802 microprocessor, andutilizes optional plug-in cartridges for avariety of add-on games and programs.

Broadcasting

The 1971-1976 period was one of con-tinued growth and innovation for theNational Broadcasting Company.

NBC News presented approximately 11,000hours of television news programming, cover-ing such major events as the final Apollomoon flights, the end of the Vietnam War,Presidential trips to Russia and China,the U.S. Senate Watergate hearings, impeach-ment proceedings by the House JudiciaryCommittee, the resignation of PresidentNixon, and the inaugurations of PresidentsFord and Carter. In 1976, NBC newsmencovered a record 30 Presidential primariesand used minicameras, and electronic tape

11

56

and video cassettes extensively through-out the election campaign. NBC made thefirst prqiection of President Carter's sic-tory and attracted the largest election nightaudience.

NBC continued its innovative program-ming with such new concepts as News -

Center 4 on WNBC-TV in New York andexpanded local news programs at otherowned stations; Weekend, a monthly tele-vision news magazine; NBC Saturday Night,a live, late -night comedy -variety series;News Update, a one -minute prime -timenews summary, and Best Sellers, whichpresents popular novels in weekly episodes.

NBC Sports continued to attract largeaudiences for major events and has nowcarried four of the five most heavily viewedsports programs of all time in terms oftotal viewing homes. Early in 1977, NBCsigned an agreement to cover the 1980Olympic Games in Moscow.

Attesting to the quality of NBC's radioand television programs and personalities,the company won 790 major awards andcitations during the six -year period, includ-ing 152 Emmy Awards and 26 George Fos-ter Peabody citations. In 1975 and 1976,NBC presented some 190 hours of specialprogramming in celebration of the nation'sBicentennial, including a ten-hour live tele-

12

cast on July 4, 1976, using 250 camerascoast -to -coast and in 13 foreign countries.In 1976, NBC observed its 50th year as thefirst national commercial broadcasting ser-vice, commemorating the milestone with anew, highly modern corporate identifica-tion program; a series of five network radiopresentations, The First Fabulous Fifty;and a special network television programThe First Fifty Years, which attracted oneof the largest audiences of the year. Na-tional Book Award nominee Robert Camp-bell summarized NBC's first half -centuryin a lively, well -illustrated book, The GoldenYears of Broadcasting.

A major project to automate TelevisionCentral in NBC's New York studios wasstarted in 1969 and completed in 1974.

This computer -controlled system, whichserves the NBC Network and the localNew York station, represents the most mod-ern and complex switching and controltelevision broadcast system in the Ameri-cas. The program was completed underthe leadership of NBC Engineering withsupport from RCA Laboratories.

Global and domesticcommunications

In six years RCA went from onesubsidiary in the telecommunicationsfield to three.

In 1971, RCA Global Communications Inc.was the only RCA subsidiary operating inthe telecommunications field. Six years

13

1971-1976

later there were two more-RCA Alascomto operate Alaska's long -lines telecommuni-cations and RCA Americom to own andoperate a domestic satellite communica-tions system. The six -year span unques-tionably was the most dynamic in the 58-

year history of RCA as a communicationscompany.

During this six -year period, RCA Glob-e= invested millions of dollars to increaseits overseas cable capacity. RCA becamepart owner of TAT -6, a 4000 -circuit cablegoing from Rhode Island to France and tomore than 30 locations in Europe andbeyond, and the TRANSPAC II cable be-tween California and Hawaii and onwardto several Pacific locations. The companyalso acquired circuits in CANTAT II be-

tween the United States, Canada, and theUnited Kingdom.

In 1971, a new computerized telex ser-vice feature called Telextra was introducedas RCA Globcom's answer to the "busy"signal. Telextra takes calls, and automati-cally forwards them to correspondents whenthe line is free. Camp -On, another newcomputerized telex improvement, was alsomade available. It repeatedly tries to makeconnections when overseas teleprinters orcircuits are busy until it succeeds in get -

14

11. Microwave towers at RCA Alascom.

12. Broadcast Systems solved receptionproblems in San Francisco with this toneron ML Sutro.

13. TK-76 portable electronic journalismcamera made on -the -spot tr news possible.

14. TACTEC portable two-way radio.

ting through. And going into operation forthe first time was Datel service for ex-change of computer data on a call-upbasis between the U.S. and Tokyo, and theU.S. and Hong Kong.

In 1972, RCA Globcom was first in theindustry to introduce UniCodes, permittingoverseas telex call selection by dialing asingle digit. That year, the company soldthe first communications satellite earthstations to the People's Republic of China.A year later, RCA Globcom again assumedfirst position among U.S. carriers in over-seas telex traffic.

In 1974, the RCA Globcom control cen-ter, housing a new computer -controlledtelex exchange, was inaugurated, at Lodi,Calif., and another was completed at Pis-cataway, NJ. With the computer complexat Lodi, and those in San Francisco andNew York, RCA was the only U.S. interna-tional carrier with four computer centers.The following year, work began on a newhigh-speed message telegram computer tomore than double RCA Globcom's mes-sage -handling capacity over the comingyears.

In 1971, RCA Globcom acquired theAlaska Communication System from theU.S. Air Force and established Alaska'sfirst commercial long -lines communicationssystem. RCA Alaska Communications, Inc.,was formed initially as a subsidiary ofRCA Globcom. In 1976, RCA Alascom be-came an independent subsidiary of RCACorporation.

In 1974, RCA Alascom announced agree-ments for the development and installa-tion of multimillion -dollar communicationssystems, both satellite and microwave, toserve the construction and operation of

15

the Trans -Alaska oil pipeline. Those sys-tems were completed and received prelim-inary acceptance for service by AlyeskaPipeline Service Company, builders of the800 -mile line, during 1976. In the summerof 1975, RCA Alascom, in cooperation withthe State of Alaska, undertook construc-tion of the first 20 small earth stations toprovide satellite communication servicesto villages in the rugged Alaskan bush.The first 20 stations went into operationduring 1976, bringing telephone commun-ications via satellite to small, isolated com-munities, which had never before had anyreliable means of communication with theoutside world. Most of the stations have acircuit for emergency medical use by theAlaska Area Native Health Service, in addi-tion to the public village telephone. Bythe end of 1977, some 100 such stationsare scheduled to be completed. Anotherjoint RCA Alascom/State of Alaska proj-ect, which got under way early in 1977, isa one-year demonstration program to bringtelevision via satellite to 23 rural com-munities. The project, authorized by theAlaska Legislature, also increases the a-mount of live or same -day satellite televi-sion to five urban areas.

The RCA Satcom System, initially employ-ing leased capacity in a Canadian satel-lite, was the first to provide commercialdomestic space communications servicesin the United States, beginning December1973. These services were switched to RCASatcoms I and II after their launches in1975 and 1976, respectively. Subsequently,the Satcom System carried the first regu-larly scheduled pay -TV program service in1976. RCA American Communications, Inc.was created as a separate subsidiary of

15. Mini -state indoor/outdoor antennasystem. 57

1971-1976

RCA Corporation to operate the domesticsatellite communications satellite system.The new Satcom satellites designed andbuilt by RCA to be the most advanced andcost-effective of their kind, link the nation'slargest business centers. With a growingnetwork of earth stations, the RCA SatcomSystem was designed to make possiblesatellite voice, data, and television com-munications throughout the 50 states atrates substantially lower than conventionalmeans.

By the end of 1976, major RCA Ameri-com earth stations were situated near sevenkey U.S. cities: New York, Philadelphia,San Francisco, Los Angeles, Chicago, Hous-ton, and Atlanta, with the last three sta-tions joining the network in 1976. In all,including government and specialized uses,more than 115 earth stations were trans-mitting and/or receiving space communi-cations via RCA satellite. During the year,RCA Americom also began providing dedi-cated earth stations carrying high-speeddata and television transmission for NASAin support of its Viking Explorer missionon Mars and the Space Shuttle program.

Commercial communications

New and improved products helpedBroadcast Systems withstand changingeconomic conditions.

RCA shared in the late 1960s boom inbroadcast equipment sales, resulting fromthe conversion of TV stations to color andthe launching of new stations. Althoughthe market fell off in 1970 and 1971 aseconomic conditions declined, BroadcastSystems continued to develop equipmentof improved quality and efficiency and

16

was in a position to capitalize on the eco-nomic upswing in 1972 and 1973.

One product that contributed signifi-cantly to RCA's leadership was the TCR-100 Video Tape Cartridge Recorder/Player.First placed in service in 1971, the systemushered in a major change in televisionbroadcast operations. It made possible theautomatic on -air showings of pre-pro-grammed commercials, program promotions,and other 30 -second to 3 -minute tape seg-ments. The TCR-100 design achievementwas recognized with the award in 1974 ofan Emmy by the National Academy of Tele-vision Arts and Sciences.

In 1973, Broadcast Systems solved thetechnical problems of providing eight TVand four fm stations in San Francisco witha common antenna site-atop a 977 -foottower on Mt. Sutra-to overcome the topog-raphy and construction impediments thathad previously marred reception.

In 1974, RCA introduced the TR-600Video Tape Recorder which took advan-tage of the increasing emphasis on costeffectiveness by incorporating into its de-sign capabilities formerly offered as acces-sories. The TR-600 is on its way to becom-ing the largest selling VTR that RCA Broad-cast Systems has ever built.

Although the economy again declinedin 1974, new products helped BroadcastSystems to maintain its position of lead-ership and increase sales and profits. Anexpanded international marketing effortalso contributed to its ability to withstanddownturns in the national economy. In1976, for example, RCA became the lead-ing TV -equipment supplier in Latin Amer-ica and the Caribbean.

The most noteworthy accomplishment

in 1975 was the TK-76, the first self-con-tained high -quality portable color televi-sion camera for electronic journalism. Thislightweight camera, housing three imag-ing tubes and all required electronics,provides a new order of flexibility com-bined with high -quality performance. In1976 orders for this camera tripled, put-ting RCA ahead of any competitor.

Other advances during the period in-cluded the development of a portable colorcamera, the TKP-45, that matched the TK-45 studio color camera in high -quality pic-tures; the introduction of the TK-28, a TVfilm system which greatly improved thereproduction of color film on televisionand quickly became the standard of theindustry; and announcement of a circu-larly polarized TV antenna, designed to

17

16. TCR-100 Video Tape cartridgeRecorder/Player makes automated stationbreaks possible.

17. Solemn communications satellite.

18. This camera was a vital part of Apollomissions.

19. PRIMUS radar integrates digital dis-plays and microprocessor technology.

reduce reflections and ghosts caused bytall buildings and other obstructions inurban areas.

Mobile Communications Systemsdesigned improved two-way radios.

In 1973, RCA Mobile Communications engi-neers, employing advanced microelectronictypes developed originally for space sys-tems, produced the TACTEC line of port-able two-way radios for the land mobilecommunications market. The use of inte-grated circuits and thick film hybrids, a-chieved with the cooperation of the SolidState Division and the military division ofRCA Government and Commercial Systems,provided the radios with more functions,better performance, and greater reliabilitythan conventional designs.

By 1976, in common with the industry,RCA's mobile -communications business suf-fered from a leveling -off in budgets ofstate and local governments, However,RCA's international business continued togrow, and the introduction of a new mod-erately priced mobile -radio line calledVEETAC, which incorporates advanced fea-tures, is expected to strengthen its world-wide competitive position.

Avionics Systems developedweather radars.

In 1975, RCA Avionics Systems introducedits new line of PRIMUS equipment to serve

18

the aviation industry for weather radarand distance measuring equipment in theairline general business, and military air-craft categories. In addition to greatly im-proved reliability, the PRIMUS equipmentsintegrate the use of digital display andmicroprocessor technology. For example,the PRIMUS 400, introduced in 1977, hasa full -color display and an expanded mem-ory for improved display resolution.

Three new weather radars were intro-duced in 1976 for the general aviation andairline market, laying the groundwork forfurther growth in 1977.

The history of RCA Community Televi-sion Systems began when RCAacquired Electronic Industrial Engineer-ing Company in 1972.

The Electronic Industrial Engineering Com-pany, which manufactured equipment forcable television systems, was originally asubsidiary and became an RCA division in1973. During that year the division intro-duced a new series of amplifiers employ-ing push-pull hybrids, which were an ad-vancement to the state-of-the-art in cableTV technology. These amplifiers and con-tinuing evolutionary improvements, estab-lished RCA Community Television Systemsas a significant contender in cable TV dis-tribution systems.

In 1975, RCA introduced a unitized fam-ily of compatible head -end equipment cap-able of delivering superior pictures formodern large -screen cable TV systems.

In the five years of RCA's operations,the business has tripled in volume andCommunity Television Systems has becomea profitable business.

Facilities management systems wereinstalled in Florida and San Francisco.

Early in the 1970s, RCA installed moni-toring and information -handling systemsthat are extensively employed in the man-agement of the Walt Disney World enter-tainment and recreation center at LakeBuena Vista, Florida. It also installed the

19

electronic management system in the new38 -story Wells Fargo office in San Francisco.

Space and defenseACA Government Systems continued itsnotable contributions to the nation'sspace and defense efforts during the1971-1976 period.

By the close of 1976, 24 RCA -built weathersatellites had been successfully orbitedand had returned some three -million pho-tographs of the Earth's weather for use inweather forecasting. RCA was selected byNASA in 1975 to develop the Tiros -N, afourth -generation weather satellite, and tobuild, integrate, and test eight of the polar -orbiting spacecraft for launch beginningin 1978. At 1400 pounds, Tiros -N nearlydoubled the weight of current weather satel-lites and carried four times the payload.New sensors will enable the satellites toobtain high -quality atmospheric tempera-ture and water vapor soundings, day andnight worldwide cloud cover pictures, andradiometric information for sea -surface tem-perature mapping.

In 1972, an RCA Return Beam VidiconCamera flew for the first time on theEarth Resources Technology Satellite andproduced high -resolution multispectral pic-tures of excellent scientific value. Thesame year saw the successful orbiting ofNOAA-2, first of a series of RCA -built envi-ronmental satellites to provide worldwideweather and ocean information never beforeavailable.

In 1973 an RCA -built Atmosphere Ex-plorer satellite was orbited to make acontinuing and systematic study of theEarth's upper atmosphere. The first Ex-plorer was followed into orbit by two oth-ers, launched in 1975.

In addition to providing informationabout the Earth's weather, atmosphere,and oceans, RCA communications equip-ment was successfully used in two spaceprobes, one to the Moon and the other toMars. During the Apollo 15 manned lunarexpedition in 1971, an RCA TV space cam-era produced the clearest color pictures

59

1971-1976 _.______.111111111111111111111111111111111111111111

made to date of the lunar surface. Thecamera was part of RCA's Ground Com-mand Television Assembly (GCTA), a sys-tem which permitted controllers at Hous-ton to operate the camera remotely fromEarth. The GCTA was mounted on theastronauts' lunar roving vehicle along witha briefcase -size RCA communications setfor direct two-way contact between theMoon and Earth. Apollo 16 and 17 astro-nauts, used similar RCA systems as wellas an RCA -built laser altimeter for accu-rate mapping of the lunar surface.

During 1976 RCA -built communicationsequipment was a vital part of the Vikingmissions that undertook scientific probesof Mars and a search there for life. TheRCA equipment was dormant during the11 -month voyage, but shortly after the Vik-ing Lander touched down it began to trans-mit color pictures and telemetry to Earthover a 250 -million -mile link. The pictureswere generally regarded as remarkable fortheir clarity and color rendition.

The RCA Satcom I and II communica-tions satellites, delivered to RCA Americomfor launch in 1975 and 1976, respectively,made ingenious use of cross -polarized sig-nals to incorporate 24 channels in a fre-quency band that formerly accommodatedonly 12. The 24 channels each can carryone color -TV transmission, or 600 two-wayvoice circuits, or 64 million bits of dataper second.

AEGIS, a key Government Systems devel-opment of the 1970s became the first Navydefensive system with the ability to auto-matically search, detect, and track multi-ple targets and to fire missiles. The sys-tem's heart is the AN/SPY-1 phased -arrayradar, which performs the simultaneous

2(1Eft

detection and tracking of multiple targets,and also provides designation data for tar-get illuminators. RCA was chosen as theAEGIS prime contractor in 1969. Sincethen, AEGIS has become the nucleus of atotal combat system, providing target -coor-dinate data to other weapons aboard shipand controlling their use through its inte-gral computer subsystems. Installed in theUSS Norton Sound, the system detected,tracked, and destroyed its first target dronein May 1974. Since that initial success,the AEGIS weapons system has had a nearperfect intercept record of missile andaircraft targets.

AEGIS entered its second phase in 1976with the award of a new $159.2 millionNavy contract calling for RCA to provide acombat system engineering development(CSED) prototype. Centered on AEGIS, itincludes additional radars, electronic war-fare, and surface and undersea weapons toform a complete combat system. Govern-ment shipbuilding plans during the 1978-1985 period feature a number of guidedmissile cruisers designed to use theAEGIS -based combat system.

In 1974 and 1975 RCA delivered to theU.S. Air Force four low-cost mobile instru-mentation radars controlled by a minicom-puter and capable of one-man operationand maintenance. Officially designated theAN/TPQ-39 (V), the system is intended formini -ranges and temporary missions, andis lightweight, relatively small, quickly setup, and highly accurate. It is capable of avariety of tracking applications, includingrange safety, scoring, vehicle performanceevaluation, and determination of discretemission events.

In military communications, GovernmentSystems' development of a family of trans-portable satellite terminals led to a $37million U.S. Army contract to build 31such stations. Readily transportable, theterminals can be put in use within 20

21

minutes and will permit tactical and stra-tegic communications on a worldwide basis.Significant production of the terminals isexpected in the next five years for triser-vice use.

After a parallel study competition thatbegan in 1972, RCA was named in 1975 tocomplete the prototype and subsequentproduction of a modern communicationscenter, or Integrated Radio Room, for Amer-ica's Trident -class submarines. The systemwill make it possible to control all ship -to -ship and ship -to -shore communications froma single console. Production and shipboardinstallation of the communications cen-ters are expected to continue into themid -1980s.

In 1975 the Armed Forces began testingthe RCA -developed EQUATE (ElectronicQuality Assurance Test Equipment), a sys-tem capable of testing virtually all typesof military equipment. A computer -basedthird -generation system, EQUATE performsdiagnostic, fault isolation, and performancetesting.

During the early 1970s, RCA developedfor the U.S. Army an automotive test sys-tem that performs more than 50 types oftests and maintenance checks on a widerange of engines and accessory systems.The system, known as Simplified Test

22

20. Transportable satellite terminal.

21. AEGIS system firing a missile.

22. AN/GIBS-5 hand-held laser rangefindercan determine range of military targets 10km away accurate to 10 in.

1971-1976

Equipment for Internal Combustion En-gines (STE/ICE), is capable of testing 15different types of vehicles, including ar-mored personnel carriers, trucks, jeeps,self-propelled howitzers, tanks, and re-covery vehicles. The system produces asubstantial reduction in maintenance timewhile significantly improving the accuracyof vehicle diagnosis.

A notable 1974 development was a hand-held laser system that accurately deter-mines the range of a military target in onesecond. The GVS-5 system is about thesize of field binoculars, which it resem-bles, and weighs only five pounds. Therangefinder's successful design resulted incontracts for several large productionquantities.

Another successful venture was the intro-duction and marketing of PRICE (Pro-grammed Review of Information for Cost-ing and Evaluation), a unique parametriccost model service. The military servicesmade PRICE a standard measurement toolfor evaluating cost proposals, and a largenumber of companies in electronics andrelated fields have contracted to use it.The PRICE family now covers hardware,software and life -cycle cost models.

23. Automobile ignition system being testedby a microprocessor -controlled test set

24. Service Co. technician does final tvcheckout

23

S

Service

The RCA Service Company continued toexpand in both operations and volume.

In 1976, the company marked the 22ndconsecutive year of increased sales in con-sumer service, achieving an all-time high.By 1973, it had already topped the one -million mark in home service contracts forTV and appliances.

The Service Company maintained itsposition as the leading supplier of TVreceivers to hotels, motels, hospitals, andschools. RCA Telephone Systems, the mostrecent addition to the commercial productsline, experienced exceptional growth-reaching 200,000 telephone interconnectlines under contract to commercial andsmall business customers by late 1976,with an aggregate contract value in excessof $100 million.

Technical service sales, which have im-proved year to year since 1958, grew evenmore rapidly in the early seventies. In1970, RCA began to lease, as well as ser-vice, data communications equipment. Bythe end of 1976, the lease base of datacommunications terminals under contractexceeded 34,000 units. The Service Com-pany also continued to be a major pro-vider of installation and maintenance ser-vices for theatre, broadcast, marine, mobileradio, scientific, industrial, and reserva-tions systems equipment.

The Service Company maintained itsposition as a leading supplier of technical

24

services to the government, furnishing oper-ational and management support for mil-itary test ranges, NASA space programs,and federal, state, and local educationalprograms.

In 1973, Service Company techniciansand engineers celebrated the 20th year ofservice at the Air Force Eastern Test Range,operating electronic instrumentation sys-tems at Cape Kennedy and the downrangestations in support of missile and spaceprograms. The Service Company team pro-vided the same support for the historicApollo-Soyuz joint space flight in 1975.

The same year it received a contract toprovide support services for aerodynamicand space research at NASA's Langley Re-search Center in Virginia.

In the early 70s, the Service Companybecame firmly established as a leader ineducational services to government agen-cies. Under a 1972 contract, the ServiceCompany began providing comprehensivevocational and language training and place-ment services for unemployed men andwomen at training centers throughout NewYork City. The program provided year-roundtraining to an ongoing student body of1800.

In 1975, the Service Company was award-ed contracts by the Department of Laborto operate major Job Corps Centers inAstoria, Ore., and Tulsa, Okla. These wereadded to continuing contracts for suchcenters in Hazleton, Pa., and Marion, Va.

61

1971-1976 Alimalimmilm Ur All11111M1A fifth center, near Baltimore, Md., wasadded in 1976.

Research and developmentThe close teamwork between theproduct divisions and the Laborato-ries enabled scientists and engineersof RCA Laboratories to work with thedivisional engineering staffs andassist them in developments of newand improved products.

The role of RCA Laboratories changed inseveral respects during 1971-1976 as a re-sult of pressures to increase the speedwith which research innovations are turnedinto commercial products, and the reali-zation of carefully laid plans for greaterintegration of RCA's technical community.

The Coloi'I'rak television receiver sys-tem, the RCA Satcom system, the NBCTelevision Central project, and the devel-opment of the RCA SelectaVision Video -Disc System are prime examples of thecloser relationship between researchers anddivision engineers.

In 1973, RCA Laboratories developed asolid-state image sensor containing morethan 120,000 electronic elements on a sil-icon sensor chip the size of a nickel. Thiswas the forerunner of the CCD camerasthat RCA Electro-Optics and Devices dem-onstrated and made commercially avail-able in 1975.

In 1975, the RCA Solid State Divisionannounced the commercial availability ofthe industry's first COS/MOS microproces-sor. The Solid State Technology Center ofRCA Laboratories was responsible not only

25

for the concept and development of thedevice, but also for the research and engi-neering that turned the experimental de-vice into a commercial product. That sameyear, the Solid State Division also beganoffering silicon -on -sapphire (SOS) circuitsto the electronics industry on a samplingbasis. This was again the product of anextensive research and development pro-gram carried out by RCA Laboratories from1971 through 1974. These low -power, high-speed devices are expected to take overan increasing share of the electronic watchbusiness, as well as to play an importantrole in electronic data processing.

During 1975, the Laboratories also madesignificant progress with the research pro-gram carried out by RCA Laboratories from1971 through 1974. These low -power, high-performance and pollution. In a relatedeffort, the Laboratories started work asthe electronics subcontractor for the devel-opment of a Research Safety vehicle forthe National Highway Traffic SafetyAdministration.

In 1976, Laboratories researchers devel-oped high-speed logic circuits that pro-cess five billion bits of information persecond under test conditions, functioningabout ten times faster than logic circuitsused in conventional information proces-sing.

In cooperation with the Alaska Officeof Telecommunications, RCA scientists de-veloped frequency-modulaton techniques topermit the transmission of satellite -borneTV signals requiring minimum power andbandwidth to small earth stations in theAlaskan hush. A related project resulted

in the development of technologies thatpermit the simultaneous transmission oftwo TV channels by a single -satellite tran-sponder, thus doubling the transmissioncapacity for TV programs from the lower48 states to Alaska.

During 1971-1976, RCA Laboratoriesmade good progress in new researchareas. For example, in 1971, Laboratoriesscientists developed a new semiconduc-tor laser with an optical capacity thatdoubled the output efficiency of previousdevices, thus speeding the eventual useof such lasers in closed-circuit televisionand in commercial and military commun-ications systems.

In 1974, a major development was anelectro-optic modulator that could permitas many as 5,000 persons to talk simul-taneously over a single -laser -beam, high-grade telephone circuit. The experimentaldevice was the first electro-optic modula-tor compatible with integrated circuits andcapable of aiming or switching the direc-tion of a laser beam. In another phase ofelectro-optic research, the Laboratories de-monstrated a document reader employinga semiconductor laser that can providehigh -quality electronic reproductions of

26

25. Twelve RCA locations across the countryhad Minorities in Engineering Programs.

26. Loser beams controlled by electro-opticmodulators may someday carry 20 tv pro-grams or 25,000 telephone conversationssimultaneously.

1971-1976

text, sketches, and photographs suitablefor long-distance facsimile transmission.

In 1975, RCA Laboratories demonstrateda solid-state laser that produces visiblelight. This continuous -wave device, whichoperates at room temperature, is expectedto enhance and speed the use of opticalcommunications in many applications.

Vehicle renting and leasing

Despite fuel shortages and rising costsHertz achieved record earnings for fiveconsecutive years.

The Hertz Corporation owed much of itssuccess in the early and mid -1970s to asignificant tightening of management proce-dures and controls, the implementation ofinnovative marketing concepts, and themove to leased "over -the -road" large trac-tor -trailers. In 1972, the Rent A Car div-ision formed the Hertz No. 1 Club, a com-puterized service to save time for the repeatrenter, and also to enable Hertz to sched-ule its fleet and manpower needs moreefficiently. The service instantly retrievesfrom the computer file such driver infor-mation as license number, type of vehiclepreferred, and charge card used. This con-cept was later extended to Canada, and,in 1975, throughout Europe.

Prior to the establishment of the No. 1Club, a centralized reservation office andseparate data center were established in

27. Hertz remote area maintenance vehicle.

28. Random House High -Intensity LearningSystems diagnose reading difficulties andindividually tailor reading prescriptions.

27

Oklahoma City. The central reservation op-eration makes it possible for U.S. customersto reserve a car anywhere in the worldwith one toll -free telephone call.

The fuel crisis of 1973-1974 precipitateda radical change in the makeup of thedomestic and international rental car fleets.In the domestic rental fleet alone, thefleet proportion changed from 60 percentstandard cars to over 75 percent interme-diate and smaller cars, providing greaterfuel economy both for the renter and Hertz.To ensure efficient standards of vehiclemaintenance, the Rent A Car division em-barked on a capital spending program in1975 to construct and equip new facilitiesat major airports. In 1972, Hertz Rent ACar began retailing used cars from its ren-tal fleet. Most of the cars are sold with a12 -month 12,000 -mile warranty on drive -train components.

In Europe, beginning in 1975, the com-pany redirected its marketing thrust towardthe business traveler as this market grewin importance. Fleets were concentratedat airports and commercial centers, andadvertising was scheduled to reach poten-tial renters where they lived, not wherethey rented cars. These moves, coupledwith operating efficiencies, have resultedin the achievement of record performancelevels in Hertz Europe.

Hertz passenger car leasing business,initially built around leasing to corpora-tions, extended its operations to individu-als in 1974. At the same time, it began toretail used cars to customers, and the fol-lowing year began finance leasing toindividuals.

During the 1971-1976 period, the Truck

28

Division undertook a major shift from thecity -suburban "van" type of rental deliverytruck to the big tractor -trailer combina-tions. Until 1972, fewer than 10 percent ofthe Hertz truck units were in the heavy-duty over -the -road classification. By 1976,up to 25 percent of its units were in thelong-distance category. As a result, Hertzexpanded and revamped its service facili-ties. It increased the number of company -

owned service facilities to more than 180by 1976. In addition, at the end of theyear, it had more than 300 franchised loca-tions, plus 700 affiliated truck stops in itsnationwide network. In 1975, Hertz com-pleted a 24 -hour emergency service systemfor its trucks on the road.

Fublishing

In 1976, when revenues in the book pub-lishing industry were relatively sluggish,Random House achieved the highestsales in its history.

Together with two of its major imprints,Alfred A. Knopf and Pantheon, RandomHouse placed 17 books on the nationalbest seller lists during the year. Over thesix -year period, offerings by Random House,Knopf, and Pantheon received major recog-nition, including Pulitzer Prizes for TheAmericans: The Democratic Experience byDaniel J. Boorstin, Huey Long, by T. HarryWilliams, and The Power Broker by RobertA. Caro. In 1975, paperback rights to Rag-time, by E.L. Doctorow, were sold for $1.85million, the highest price ever obtainedfor such a sale. The juvenile departmentpublished books by such renowned authorsas Richard Scarry, Dr. Seuss, and Ronald

1971-1976

Dahl, as well as Sesame Street and CharlesSchulz's Charlie Brown.

In 1972, Random House acquired Bal-lantine Books,a mass -market paperbackhouse that publishes originals, e.g., Val-

ency Girl by Robin Moore and Susan Dietz,and Star Trek Star Fleet Technical Man-ual, and a variety of popular reprints suchas Something Happened by Joseph Hellerand the Seven -Per -Cent Solution by Nicho-las Meyer. In 1975, the company acquiredCRM textbooks, a major publisher in thecollege field.

Random House's High Intensity Learn-ing Systems increased its operations sig-nificantly. This program focuses on read-ing centers where youngsters' reading diffi-culties are diagnosed and corrected withindividually tailored reading prescriptions.By the end of 1976, there were over 2000reading centers.

Random House Enterprises, a direct mailoperation, was launched in 1973. By 1976,its most successful products, the McCallsGreat American Recipe Card Collectionand Weight-Wakher's Recipe Card Collec-tion, had more than two million customers.

Food processing and distribution

The key to Banquet Foods' success wasa continuing expansion program.

During the six -year period, Banquet FoodsCorporation enjoyed uninterrupted yearlyincreases in sales of its more than 100products. It emerged the leading force inthe frozen prepared food industry takingfull advantage of its industry's recoverywhich had been building since late 1975.The easing of inflation and recessionary

29

pressures on the company as well as theconsumer, coupled with Banquet's in-creased marketing efforts in the easternpart of the United States, and better manu-facturing efficiencies through newly imple-mented industrial engineering techniques,enabled the company to turn in a recordyear for sales and earnings in 1976.

In 1971, Banquet Foods successfully intro-duced a variety of new products, includingfrozen fried chicken, and opened a fullyintegrated frozen fried chicken operationin Batesville, Ark. The following year, itexpanded its distribution to all 50 statesand Canada. To improve its distribution inthe Eastern market, Banquet Foods, in1973, began operation of a major frozenfood processing plant in Wellston, Ohio.Production capacity was doubled at theBatesville plant. When recession hit thefrozen prepared food industry in 1974, thecompany countered the problem with ener-getic promotional campaigns and the intro-duction of several product innovations.

By 1975, Banquet Foods' frozen friedchicken business had become the indus-try leader. In that year, a unique, fullyautomated massive freezer complex alsowas constructed at Wellston, further strength-ening the company's market position inthe Eastern United States.

Contributing to its 1976 success wasBanquet's new package design system. Intro-duced during the fourth quarter of 1975,the new package design system has accom-plished its overall objective of providingBanquet products with a uniform identitythereby allowing the consumer to easilyidentify, recall, and choose the Banquetbrand over anything else in the retail freez-er cabinet. Total conversion for all 100 -

plus Banquet products from the old pack-aging to the new uniform system is ex-pected to be completed in 1977.

In 1974, RCA acquired Oriel Foods Lim-ited, and Morris & David Jones Limited,both major food distributors in the UnitedKingdom. The two companies were inte-grated in 1977) to form the Oriel FoodsGroup.

Home furnishings

Despite depressed conditions in thecarpet industry, Coronet continued toinnovate and grow.

The twin problems of inflation and reces-sion that struck the nation during thelater half of the 1971-1976 period createdsevere problems in the housing field. FewerAmericans bought new homes because ofthe economic situation, and fewer house-holders made major investments in fur-nishings, As a result, Coronet Industries,acquired by RCA in 1971, was adverselyaffected.

30

29. Coronet industries continued to ino-vate and grow despite inflation andrecession.

30. By 1975, Banquet Foods' fried chickenbusiness had become the industry leader.

1971-1976

This did not prevent Coronet from con-tinuing to innovate and grow. Do-it-your-self carpeting was introduced in 1971. In1973, new equipment and processes fortufting, dyeing, and finished carpets high-lighted expansion and modernization pro-grams in five Coronet plants in the U.S.The following year, the new carpet -dyeingtechnology was extended to all plants inthe U.S. and Canada. Construction of anew yarn -spinning facility was begun atGainesville, Ga., within easy supply rangeof the main Coronet plant at Dalton. Inthe Far East, Coronet began marketing itsfloor coverings through a network of dis-tributors in Japan, Hong Kong, Singapore,and Australia.

By 1976, profits for Coronet as a wholehad more than doubled and sales reacheda record high for the company's majorproduct, floor coverings. To enable Coronetto concentrate on its more profitable andfaster growing carpet business, the com-pany acquired full ownership of CoronetCarpets, Ltd., of Canada and by 1977 hadsold both its furniture and wall -coveringoperations.

Corporate responsibility

Over the 1971-1976 period, RCA broad-ened its interest and activities as asocially responsible corporation, bothnationwide and in the communitieswhere it operated.

In addition to the long-standing Affir-mative Action programs to assure improvedopportunity for minority groups in recruit-ment and promotion, RCA, in 1971, devel-oped a new program to assess the qualifi-cations of women employees throughoutthe company, and to ensure them equalconsideration with men for promotion tomore responsible professional and super-visory positions. That same year, RCA alsowon national recognition for its company-wide environmental improvement programthat included recycling centers at five ma-jor RCA locations.

In 1972, ground was broken for a majorurban renewal program in Camden, NJ.,supported by RCA and others and involv-ing the rebuilding of most of Camden'sdowntown area. During this period, in oneof the nation's most successful inner-cityhousing programs, the company also aidedin the rebuilding of more than 500 housesin Camden. Support was also given to cer-tain community -based job training programsin cities where the company had facilities.

In 1974, purchasing officials throughoutthe company were instructed to seek bidsfrom qualified suppliers who were membersof minority groups. Concurrently, RCAsought to stimulate minority vendor inter-est through advertisements in black andHispanic media. As a result, 92 such ven-dors, an increase of 46 percent over 1973,sold some $2.2 million worth of materialsand services to RCA.

By the end of 1975, RCA could reportthat as a result of its vigorous AffirmativeAction programs, approximately 12.5 per-cent of its employees in the United Stateswere minority group members represent-ing 15 percent of the hourly workforce,and 10.5 percent of salaried employees.Approximately 40 percent of all RCA em-ployees were women, and they occupied17 percent of the managerial, professional,and sales positions. In 1975, the companyincreased substantially its purchases fromminority vendors, including black and Ameri-can -Indian owned companies.

RCA also took part in the Minority Intro-duction To Engineering (MITE) programto encourage minorities and women toenter the engineering profession. In addi-tion, it established the RCA -MEP (Minori-ties in Engineering Program), designed to

interest minorities in engineering. In 1975,twelve RCA locations across the countryhad MEP programs, giving approximately200 talented high school students an oppor-tunity to learn firsthand about theprofession.


At the Annual Shareholders Meeting inMay 1977, President Griffiths described1976 as "a turn -around year, and the secondbest in the history of this Corporation."He then pointed out that in the first quar-ter of 1977 "our sales had advanced by 9percent and our profit by 41 percent. Ourprofit dollars were $48.5 million, and thisrepresented the very best first quarter thatRCA has ever experienced."

He then went on to say he expectedthat in 1977 RCA would do appreciablybetter than the predicted 12 to 14 percentincrease of the corporate profit for Ameri-can companies and that "we are on ourway to another record year."

In summation, Mr. Griffiths said he hasoften been asked, "How much money canRCA make? And I've given them what is atotally honest answer. I don't know, AndI've quickly added that we are embarkedon a program to find out. I believe that wehave the tools and the people, we havethe buildings, the facilities, the test equip-ment, and we need now the energy anddetermination to do it. And that we have."

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3

1. The first AEGIS guided missile cruiser,Ticonderoga, during second sea trialsdemostrated her capability to carry outher mission.

2. Zubin Mehla directed the New YorkPhiUtarmonic as part of NBC's Live fromStudio 8F1 series.

3. RC4's new solid-state CCD color TV cameracamera eliminates many problems of tubecameras. The camera was used in 1984 at theWorld Series and at both Democratic andRepublican Conventions.

Part 7-The years 1977-1984

By William M. Webster

RCA targets three major growth areas -electronics, communications, and entertainment -corresponding to its basic strengths and competencies.

Of the many events that involved RCA inthe challenging years 1977-1984, the mostcrucial was the watershed decision madein 1981 by top management to focus onthose business areas offering the greatestpotential for growth-electronics, com-munications, and entertainment. The deci-sion was made after a long hard look atRCA's strengths, talents, and special abili-ties and at the industries in which RCAcompetes. This significant decision waswelcomed because it recognized that RCA'sgreatest strength was, as stated by theChairman and Chief Executive OfficerThornton F. Bradshaw, "our technologicalbase of 6200 scientists and engineers."This group of highly talented technicalpeople, augmented by equally talentedmarketing, production, and administrativepersonnel, is constantly meeting the chal-lenge to bridge the frontiers of technologywith the realities of the marketplace.

This seventh segment of RCA's historywill focus largely on the accomplishmentsin these core areas. However, it will notoverlook other areas of RCA business inter-ests, including some that have been dis-continued or sold, or the several very pro-fitable ones that have remained an impor-tant part of the RCA family.

The most important management changewas made in July, 1981, when Mr. Bradshawbecame Chairman and Chief ExecutiveOfficer, succeeding Edgar H. Griffiths. In1982, Mr. Bradshaw selected Robert R.Frederick as President and Chief Operat-ing Officer.

First, let us review the highlights ofRCA's electronics business during 1977-1984.

The company that introduced televisionto the world continued its leadership byintroducing several significant innovationsinto RCA television receivers. One, in 1978,

was the ChanneLock color tuning systemthat electronically (rather than mechani-cally) locates and locks onto the selectedTV channel, eliminating the need for a man-ual fine-tuning adjustment. The year 1978also marked the introduction of charge -

coupled delay -line integrated circuits thatbrought about a significant increase in pic-ture sharpness and quality

More recently, in 1984, this delay -line or"comb -filter" has been improved to extract100% of the color information from thebroadcast video signal. The increased colorresolution has provided a demonstrableimprovement for TV viewers.

Another source of major and continuingimprovement in picture quality lies withthe picture tube. First, the precision in -linematrix color picture tube, introduced in1972, offered a more efficient energy -savingcolor TV system. Then, in 1982, anotherforward step was achieved with the COTY-29 color picture tube system. This systemoptimized the design of the tube, yoke, andthe receiver to provide improved focus andgenerally superior performance and relia-bility with reduced system and operatingcosts.

RCA continued its leadership in CMOSintegrated circuits by introducing a numberof large-scale ICs having applications rang-ing from TV receivers to automotive fuelmanagement systems. In 1981, sales of theRCA CMOS Microprocessor 1802 surpassedtwo million units, firmly establishing it as aleading low-cost CMOS microprocessor inthe industry. By 1984 the annual RCA salesof CMOS devices, now 7% of the IC industry,passed $200 million. RCA is well positionedin this fastest growing part of the ICbusiness.

The VideoDisc System, introduced in1981, was an outstanding technologicalachievement combining RCA's skills in

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1977-1984

both electronics and entertainment butwith a major emphasis on video signal pro-cessing. In 1984, sale of the VideoDiscplayer was discontinued. The sale of Video -Discs is continuing, with more than 1200titles available.

RCA's efforts in behalf of the country'smilitary defense also featured outstandingachievements. One of the most importantis the AEGIS weapons system, a significantadvance in fleet defense. This first fullytested AEGIS system became operationalin the Navy's new guided -missile cruisers,USS Ticonderoga (CG47) and USS York-town (CG48). To date, Congress has autho-rized construction of 16 CG47 class cruis-ers plus the lead ship in the Arleigh Burkeclass (DDG51) of guided -missile destroy-ers. The AEGIS system includes four fixedphased -array antennas mounted on foursides of the ship's superstructure, insteadof conventional rotating radars. These rad-ars can search and track in all directionssimultaneously. The AEGIS weapons con-trol system can simultaneously fire anddirect more missiles at more targets withgreater accuracy than any other system.The AEGIS weapon system represents thebiggest defense program in RCA's historywith a total dollar value since its inceptionin 1969 exceeding $2.5 billion.

Another RCA innovation, the TK-47 broad-cast color TV camera, was honored with anEMMY in 1981 by the National Academy ofTelevision Arts and Sciences. With itsmicroprocessor controls, the TK-47 auto-matically checks and aligns its circuitry inseconds, thereby eliminating the hour ormore of manual adjustment required forconventional TV cameras.

Another EMMY winner was the circu-

4

larly polarized antenna that provides stron-ger signals for broadcasters in their areasof coverage.

A crowning achievement in TV camerascame in 1984 with the introduction of theCCD (charge -coupled device) camera thattakes pictures in very low light, has a verywide dynamic range, completely eliminateslag and fuzziness usually associated withmoving objects, is very rugged, and hasunique special -effects capabilities. TheCCD image sensor technology employed inthis camera is finding use not only inbroadcast operations but in military, sur-veillance, and consumer applications.

It is worth mentioning at this point thatRCA's traditional expertise in video signalprocessing has been the keystone of manyof its electronics and communicationsactivities and has helped gain and holdworld leadership.

The line separating electronics and com-munications activities is not a sharplydefined one from the technology stand-point. In fact, one could easily affirm thatRCA's tremendous satellite activities aremajor achievements in both areas. In the1977-1984 period, twenty five RCA -builtsatellites were launched, including five in1981-making it the busiest RCA year inspace since the company entered the fieldin 1958. These satellites have a wide rangeof applications including communications,weather information, search and rescuemissions, navigation, and scientific stu-dies. RCA also made major contributions toNASA's Space Shuttle program, particu-larly with camera equipment and radiosystems.

Before we continue the highlights of

5

RCA's recent communications achieve-ments, it is appropriate to recall that wire-less communications was RCA's first busi-ness and that the RCA communicationsspecialists today are maintaining a long-standing tradition of world leadership ininternational communications systems.

In the fall of 1975, RCA began to makecable television a household word by dis-tributing Home Box Office programmingto two earth stations, in Jackson, Missis-sippi and Fort Pierce, Florida. Four yearslater, there were over 7000 earth stationsin this service, and today RCA has twosatellites dedicated to cable televisionthat reach over 6,000 cable systems inthe U.S.

In 1978 RCA introduced the first high-speed, high -quality facsimile service forinternational use in concert with KokusaiDenshin Denwa, a Japanese internationaltelecommunications company. It now servestwenty-eight countries. Other communica-tions services initiated during this periodinclude telex access to and from compu-ters, a full service electronic mail system(RCA Mail), domestic telex and leased -channel services, and a national pagingservice that is expanding towards a world-wide personal messaging service.

In the entertainment field, the thirdarea of RCA's core businesses, RCA hascontinued its accomplishments in broad-casting, records and tapes, and has enteredseveral new areas of home software distribu-tion.

In the field of TV broadcasting, NBC hascontinued to be a leader in a dynamic, everchanging industry. Revenues, over the 1977-1984 period, have increased at an averageannual rate of nearly 11 percent. Althoughprofits declined between 1978 and 1981,they have risen since. In 1983 and 1984,NBC experienced the highest profits in itshistory. In the 1984 ratings, with qualityprograms, NBC-TV has advanced from thirdto second place in prime time. It has won agood share of Emmy Awards. One programalone, "Hill Street Blues," has won 25 dur-ing the 1981-1984 period. The new CCDcamera, mentioned earlier, was introducedby NBC and used in the 1984 World Seriesto achieve some remarkable slow-motion

6

68

1977-1984

4. Microwave relay antenna towers, used byRCA Network Services, transmit voice anddata among RCA's major locations betweenNeu' York City and Camden, A1.1.

5. Technicians at RCA Astro-Electronicsattach a solar array panel to the U.S. Navy'sNOVA -I navigation satellite. Nova satelliteswere launched in 1981 and 1984.

6. "Nipper" originally joined RCA with theacquisition of the Victor Talking Machine Coin 1929. The trademark was brought backinto use in 1978 for consumer andcommercial products.

7. The Control Center of RCA's DimensiaAudio/Video System communicates com-mands to audio and video components pro-viding remote control. The user simply entersa command, and the microcomputers carryit out, allowing multiple functions to beoperated simultaneously.

8. RCA offers a wide choice of color videocameras, including the incredibly light (only.15 ounces) "Small Wonder"

9. Computer controls the placement ofcircuit -board components for a color TVchassis at RCA Consumer Electronics'Bloomington, Ind., plant.

7

action scenes that would not have beenpossible with a conventional tube -basedbroadcast camera.

RCA Records during the 1977-1984 periodincreased its share of the market bothworld-wide and in North America. In addi-tion to records and cassettes, RCA began tomarket laser -based digital Compact Discsand became distributors throughout theUnited States and nine foreign countries ofvideo cassettes for Columbia Pictures. Itexpanded its record clubs by launching a

Compact Disc club. In 1984 it began a yearlong celebration of Elvis Presley's fiftiethanniversary. To date, over one billion copiesof Presley's recordings have been sold byRCA.

The subsequent text is a more detailedcoverage of the historical highlights andaccomplishments of RCA during the 1977-1984 period. The author owes considerablegratitude to the divisions and subsidiariesof the RCA Corporation for their help in thecompletion of this history.

Electronics-RCA Enhances Its Heritage

Consumer Electronics DivisionIn the years 1977 through 1984, RCA con-tinued on a "fast track" in terms of techno-logical developments and in rapid expan-sion of the video products market. Theperiod properly can be characterized asone in which RCA continued at the fore-front of the "video revolution" with signifi-cant advances in color television receivers,with entry into the marketing of video cas-sete recorders (VCRs) and the early assump-tion of a leadership position, and, near theend of the period, with the introduction ofbroadcast stereo and "Dimensia," a dra-matic new concept in audio/video systemcontrol.

In early 1977, RCA announced the intro-duction of its XtendedLife television re-ceiver chassis. Because the chassis requiresreduced operating power, less than thatused in a 100 -watt electric light bulb, the

potential operating life of the receiver isextended. The XL chassis first was incor-porated in XL -100 models and then just afew months later it was incorporated inColorTrak models. By mid -1978 all RCAcolor receivers utilized this energy -savingchassis.

1978 also witnessed the use of large-scale integrated circuits (LSIs) in new RCAC,oloffrak receivers to eliminate the needfor fine tuning, a manual control that had

8

9

1977-1984

been part of television receivers since theintroduction of color in 1954. Called Chan-nelLock, the tuning system is based on anRCA -developed frequency -synthesis systemusing a precision quartz crystal that auto-matically matches the exact station fre-quency and locks in, ending tuner drift thatcan distort colors in the picture.

The period 1977-1984 was also signifi-cant for RCA in terms of the VCR distribu-tion business, which it entered near theend of 1977. The company aggressivelypursued this new business opportunitywith heavy investments in advertising andpromotional programs. These programs to-gether with careful choice of product spe-cifications and capabilities led to RCA'sbecoming the recognized leader in VCRmarketing. New products included pro-grammable recorders, portable recorders(some with on -screen display graphics tofacilitate remote programming), and theintroduction of associated color cameras,like the 2.2 -pound RCA "Small Wonder."

Other developments during the 1977-1984 period included:

First, as an interim step, the addition ofthe capapability of receiving mid -bandcable television channels on some modelsof color receivers. This step initiated thedevelopment program for RCA's frequency -synthesis, multiband tuning system that by1982 led to receivers having 127 -channeltuning capability.

Emphasis on the remote control featurefor color receivers. Remote control receiv-ers accounted for 35 percent of all RCAcolor television unit sales in 1981, a growththat is continuing.

Entry into the promising projection tele-vision business in early 1981. These large -screen television receivers are a natural forthe "videophile" and RCA has made signi-ficant advances in picture brightness andresolution.

10

o The introduction, beginning 1980, of aline of high-technology color monitor re-ceivers particularly suited for use withvideo cassette recorders, video games, andhome computers. These monitors havebeen enthusiastically received by the Ameri-can consumer.

o In mid -1984 the introduction of color TVreceivers having the built-in capability forreceiving broadcast stereo transmissions.These receivers also include a "secondaudio program" channel offering the broad-caster a variety of options including theaudio programming of a second language.

o Near the end of 1984 the "marriage" ofaudio and video in a new audio/video sys-tem called "Dimensia." Using extensivecomputer technology, this product is thefirst consumer system to wholly integrate avariety of audio/video components into afull -function media center, providing sim-plified operation and full remote control ofeach component, independently or in con-cert, by means of a single remote device.

Video Disc VentureIn March of 1981, RCA introduced its"SelectaVision"VideoDisc system to thegeneral public, culminating more than 20years of research and development. The12 -inch plastic discs, which resemble audiolong -play records in appearance, containup to one hour of prerecorded audio andcolor video information on each side. Thevideo disc player can be attached to anytelevision set for playback.

In developing the video disc system, RCAscientists had to advance the state-of-the-art in several technologies by developing:

A method of recording a spiral grooveover 7 miles long, having over 10 thousandturns per inch.11

Optical, mechanical and electron beamtechniques for recording signal elementsas short as one millionth of a meter on thedisc master.

Signal systems for providing processedTV pictures and audio signals, synchron-ized for either mechanical or electron -beam recording on a disc master.

Methods of making suitable metal stamp-ers and plastic discs from the masters.

Technology in fabricating an unprece-dented new stylus having a tip less thanone tenth the size of those used for audiorecords.

Ultra -sensitive circuitry to detect capac-itance variations between stylus and discsurface.

Players capable of tracking the finelypitched grooves and processing recordinformation into electronic signals thatprovide full color pictures and stereosound.

The "CED" (capacitance electronic disc)system is a widely acknowledged tribute tothe skill and ingenuity of RCA scientistsand engineers.

When the playback -only video disc sys-tem was introduced, RCA managementrecognized that it would be successful onlyas long as it could maintain a substantialprice advantage over the video cassetterecorders, which offered consumers theadditional ability to record off -the -air orwith a home TV camera. The combinationof steep price cuts on VCRs and the availa-bility of inexpensive cassette rentals, how-ever, eroded the sales of video disc playersand in 1984 forced RCA to halt player pro-duction. The company continues to manu-facture video discs and there are more than1,200 "CED" titles available to consumers.

12

70

11111.111.1.11K.1977-1984

10. Video discs are pressed and then sprayedwith a special solution at the manufacturing

facility in Indianapolis.

11. Giant mechanical arm used fortransporting funnels for color TV tubes froma coating machine to a conveyor at theScranton, Pa., plant.

12. Interiors of color television picture tubefaceplates-already treated with aphotosensitive phosphor solution-areexposed to ultraviolet light in a mechanizedscreen room.

13. High -resolution display tubes forcomputer -graphics applications being testedin 1981 at RCA's facility in Lancaster, Pa.

14. A designer is shown using a graphicsterminal for computer -aided design andmankfacture. More than 150 personalcomputers and graphic design terminalswere introduced into the VCD Division aspart of a multiyear program.

15. Computerized equipment is used to checkperformance of electron beams in colorpicture tubes. The large roils surrounding thetube are used during tests to provide controlof ambient magnetic conditions.

13

RCA Video Component andDisplay Division

Throughout the history of commercial tele-vision and particularly since RCA scien-tists pioneered the shadow -mask color TVtube, RCA has held a leading role in theproduction and sales of picture tubes. RCAcelebrated the 25th anniversary of the sha-dow -mask tube in 1979, and by 1984 RCAand its affiliates had produced over 130million TV picture tubes. Of these, 90 mil-lion were color and 40 million were black-

and -white picture tubes. RCA discontinuedblack -and -white production in 1977 to bebetter able to support the growing demandfor color.

By 1978, RCA's line of precision in -linematrix color picture tubes, which sup-ported the more efficient energy -savingcolor TV system, was well established notonly in the U.S. market but also in Europe.In 1982 RCA reasserted its technical lead-ership with the commercial announcementof the COTY-29 program (Combined Opti-mum Tube and Yoke, having a neck diame-ter of only 29 millimeters). Its improvedfocus and miniaturized yoke resulted insavings in materials costs and a reductionin the deflection power required. Thisadvance was followed in 1983 with theCOTY-FS (Full Square) color picture tubefeaturing a rectangular screen, i.e., onehaving straight sides and square corners,and, consequently, a larger viewing area.The latest version (1984) COTY-SP (SquarePlanar) has a nearly planar screen edge, amuch flatter faceplate, and a rectangularscreen. These new tubes represent the firstmajor change in industry screen size andformat in 13 years.

The period 1977-1984 brought aboutsome interesting developments in picturetube manufacture. In 1981, worldwide over-capacity for color picture tubes compoundedthe impact of the general economic situa-tion and made it difficult to maintain ade-

14

quote profits. Consequently, major stepswere launched to improve operating effi-ciencies in all areas of the business. Amongthem were the decisions to end the part-nership arrangement with VideoColor(France) and, in 1982, to close the Midland(Canada) plant.

The technology portion of the interna-tional business, however, was very active.From 1978-1983 RCA sold color picturetube manufacturing equipment to theU.S.S.R.; in 1982, a 7 -year equipment andtechnology transfer contract with Polandwas successfully completed; and in 1984,top-level discussions were held with thePeople's Republic of China with the goal ofestablishing ajoint program. In addition tothe profit opportunities, these efforts rein-forced RCA's technical image and contrib-uted to its domestic position of strengthand leadership.

During this period, a number of produc-tion advances also were made. In 1978,three Unimate robots were installed inScranton, marking the beginning of a focuson automation in the manufacturing plants.From this modest start, the effort grew oversubsequent years to include highly auto-mated screen rooms and computer -con-trolled or monitored equipment of allkinds. The rising cost of labor coupled withthe rapid advances in computer technologyhas tipped the scale dramatically towardgreater automation efforts.

The Picture Tube Division was renamedin 1983 as the "Video Component and Dis-play Division," signifying a new charter topursue OEM sales of video display productsfor computer and other major commercialand industrial applications, as well as tosustain its traditional role as a major sup-plier of color picture tubes to the TV indus-try. RCA entered the color data -display CRT

15

71

1977-1984

market in 1982 with a high -resolution tubehaving a 13 -inch diagonal and 90 -degreedeflection angle.

A line of monochome and color monitorswas introduced to the computer market in1984. Monitor design efforts draw on theexpanded engineering capabilities of theConsumer Electronics and New ProductsDivisions. Existing manufacturing facili-ties in these divisions are utilized to pro-duce the display monitors. The RCA Labor-atories provide the extensive research anddevelopment support required for futureproducts.

Solid State Division

In 1977-1984 RCA continued to maintainleadership in CMOS integrated circuitsthrough cooperative efforts by the engi-neering staffs of the RCA Solid State Divi-sion, the Solid State Technology Center,and the Laboratories. The RCA -inventedCMOS technology, which made digitalwatches and hand-held calculators possi-ble, has been at the forefront of RCA's solidstate efforts. RCA is one of the few manu-facturers to offer a total line of CMOS logicproducts. During this period, RCA intro-duced a very large number of new inte-grated circuits having applications rangingfrom television receivers to automotivefuel -management systems.

In 1977, RCA Solid State introduced asingle -package IC for television receiversthat replaced three ICs in use only a yearearlier. The result was a simpler and morereliable chassis having an added feature,

16

automatic tint control. Other RCA IC designsfor TV receivers are described in the Con.sumer Electronics section of this history.Throughout 1977-1984, RCA Solid Stateintroduced a large number of linear anddigital ICs designed for specific applica-tions. In many cases, ICs were also designedand manufactured for specific customersthroughout the electronics industry, in-cluding the military and aerospace, forwhom high reliability has been a mgjorrequirement.

In 1981, the company produced new ICsfor both the U.S. and European automotivemarkets. RCA introduced the first com-mercially available ignition control IC in1981. In 1983, Chrysler chose RCA as themgjor supplier for the microprocessor forthe spark -control computer system to beused in 1985 models.

Because the RCA -developed CMOS tech-nology offers low power consumption, goodreliability, and high speed, a number ofnew applications for large-scale integratedcircuits (LSI) using the CMOS technologyappeared late in the 1977-1984 period.These applications included automotivefuel management systems, pollution andtiming controls, portable instrumentationand equipment, and implantable medicalelectronics. Also in 1981, the sale of theRCA CMOS 1802 microprocessor surpassed2 -million units, firmly establishing thisdevice as a leading low-cost CMOS generalmicroprocessor system in the industry.

The latter part of this period also saw atrend toward alternate -source agreementsand joint ventures in the semiconductorindustry. RCA was a participant in thistrend. In 1981, RCA broadened its line of

17

microprocessors by obtaining the right toproduce and sell Motorola's 8 -bit CMOSmicroprocessor design. In 1982, RCA signedan agreement with Philips of the Nether-lands for ajoint development of high-speedCMOS logic chips, known as QMOS. QMOSdevices are important because they includehigh-speed CMOS replacements for LSTI'Ldevices in existing designs and also low -power all-CMOS designs for new digitalsystems. In 1983, alternate -source agree-ments were completed with LSI Logic, Inc.for semicustom gate arrays. In 1984, RCAannounced a joint venture with Sharp Cor-poration, a Japanese electronics company,to engage in the design, development andfabrication of CMOS VLSI integrated cir-cuits in the United States.

During the later half of 1977-1984 period,the semiconductor industry was rapidlybecoming aware that the CMOS techno-logy, which RCA invented in 1962, was thetechnology of the future for large scaleintegrated circuits. RCA's experience andexpertise in CMOS put the company in afirm position for rapid and healthy growthwith this product in the years beyond 1984.

New Products Division

The New Products Division, headquarteredin Lancaster, Pennsylvania, was created inlate 1983 to implement RCA's strategy ofincreasing new -business development with-in the electronics area. The Division isorganized to plan, develop, manufacture,and market new electronic products. It wasformed with a base business of RCA's exist -

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1977-1984

16. Many engine functions of Chryslerautomobiles are monitored and controlled byan advanced electronic engine -control kitcomposed largely of integrated circuitsproduced at RCA Solid Stale Division.

17. A "carousel" of integrated circuit wafersis lowered into an ion implantation chamberat RCA Solid State, in SomervilleV.J.

18. An employee inserts a silicon -intensifiedtarget (SIT) tube into a surveillance -type TVcamera at New Products Div., Lancaster, Pa.

19. Charged -coupled device used as imagesensor in solid state color television cameras,such as the RCA CCD-1 broadcastcamera.

20. The 320-1b. electronic vacuum -switchtube, manufactured in Lancaster, Pa., anddelivered to Princeton University in 1978.

21. At D&SP's warehouse in Depford, NJ,orders are processed and an inventory ofthousands of items is maintained bycomputer.

19

ing closed-circuit video equipment, powertube and other electro-optics componentsactivities.

The division encompasses several dif-ferent businesses participating in unre-lated markets. The largest is the ClosedCircuit Video Equipment (CCVE) line. Aleader in its marketplace, this divisionmanufactures closed-circuit television cam-eras and monitors. It also purchases andresells various accessory products such astape recorders, time/date generators, mo-tion detectors, and other installation acces-sories. RCA's CCVE products are sold tobanks, supermarkets, shopping centers,department stores and the like, as well asto Government installations.

A product line for many years is NPD'sTube Operations. In the Tube Operations,RCA's power tubes have given the companya leading position in the VHF transmittertube market and a solid position in specificmilitary applications for radars, communi-cations, and countermeasure systems. PowerTube Operations is also heavily involved inthe government's Fusion Research Pro-gram for energy development.

NPD's Tube Operations is also theworld's largest manufacturer of SiliconTarget Vidicons (trademarked Ultricons),for low -light -level closed-circuit television.

Photomultipliers and high -resolutiondisplay tubes completed the Tube Opera-tions' product line.

New Products Division is responsible for

20

the development and production of solid-state imagers, known as charge -coupled de-vices (CCDs). These devices are also men-tioned in connection with the BroadcastSystems Division's new color TV camera.

NPD also operates a Solid State Emit-ters and Detectors product line, headquar-tered in Montreal, Canada. High-performancelight -emitting diodes, solid state injec-tion lasers, IR photodiodes, and avalanchephotodetectors have given RCA a leader-ship position in many military and tele-communications applications.

Distributor and SpecialProducts Division

During 1977-1984, the RCA Distributor andSpecial Products Division focused on itsmajor role of marketing parts, components,and accessories through a network of morethan 500 electronics distributors.

From a vast inventory of some 80,000separate items, the Distributor and SpecialProducts Division provides replacementparts and components to support RCAelectronic equipment throughout the world.Many of the Division's products are alsoused in equipment of other manufacturersand are marketed for general industry use.

In order to capitalize on the tremendousgrowth in VCR instruments, the divisionentered the VCR accessories business in1982. This new business activity was a natu-ral outgrowth of the TV accessories busi-ness in which the division had been involved.In 1983, the division further broadened itsbase in VCR -related products by addingblank video tape. Both of these new busi-21

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1977-1984

messes slio% extcptional promise tor futuregrowth.

Other products marketed by the divisioninclude RCA exact replacement parts,solid state devices, receiving tubes, picturetubes, and industrial tubes.

The Division's products are utilized inequipment ranging from TV sets and otherconsumer instruments to sophisticatedmanufacturing and broadcast systems. Theitems vary in size from microscopic solidstate devices to huge transformers. Thedivision's warehousing and shipping facili-ties cover more than 26 acres, equivalent toseven football fields.

Broadcast Systems

The 1977-84 period saw RCA BroadcastSystems record peak sales, growth andprofits during the early years, followed bya sharp contraction of sales, with severeoperating losses during 1982-84.

Camera design activity during this timewas maintained at a high level. The innova-tive TK-76 portable camera, introduced in1975. was an engineering and marketingsuccess. In five years, more than 3,000 ofthese cameras were put in operation in50 countries.

The TK-47 automatic color camera in-troduced in 1979 was a microprocessor -based design that permitted fast, auto-mated setup and established new stand-ards for camera performance, stability,and reliability. The automatic features22

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were adapted to telecine (film to videotransfer) with the introduction of the TK-290 automatic telecine system. The TK-290 utilized the same set-up terminal asthe TK-47, allowing operation as an inte-grated system with attendant economies.In 1984, RCA announced the TK-48 auto-matic color camera having added featuresand expanded software capability for en-hanced performance.

Clearly, the technological achievementof the 1982-84 period was the develop-ment and introduction of the CCD-1(charge -coupled device) camera. This solid-state camera represents a significantbreakthrough because it eliminates prob-lems associated with conventional tube -type cameras-tube replacement, lag,comet tailing, image burn -in. Used by NBCin 1984, delivery to others began in 1985.

A key new product, the TR-800 one -inch videotape recorder developed in thelate 1970s, was expected to generate ex-cellent sales as a replacement for agingquadruplex videotape machines. However,although the product design includedmany advanced features, it proved diffi-cult to manufacture and required exten-sive field servicing. Consequently, the TR-800 was discont inued and inventory writtendown, contributing substantially to 1982-1984 operating losses.

For videotape, a new half -inch Chro-maTrak recording technique was developedin 1983 utilizing VHS videocassettes, yetachieving video quality approaching thatof the far more expensive one -inch VTRs.The new format was the basis for the one-piece recording camera, a unique conceptintroduced by RCA. The system was atechnological achievement and RCA earnedan engineering "EMMY" in 1983 for itsdevelopment. The lack of standards inhalf -inch videotape recording, however,

23

hampered industry acceptance of the for-mat, and the system has not achievedanticipated market penetration.

Among the bright spots throughout theperiod was the continued broadcaster pref-erence for RCA television antenna andtransmitter products. A new line of ad-vanced solid-state VHF transmitters wasintroduced in 1979 and expanded to cover26 models in power levels from 10 kW to100 kW. More than 100 of these G -Seriestransmitters were delivered in the firsttwo years. The transmitter line was ex-tended in 1984 with the announcement ofa solid-state 100 -kW UHF transmitter, anadvanced design system utilizing high -ef-ficiency klystrons.

In 1979, RCA completed erection of theworld's larges multiple TV antenna on topof the 110 -story World Trade center inNew York City. The 351.5 -foot RCA antennatower accommodates antennas for 10 TVstations and 15 FM radio stations.

Circular polarization of TV signals toimprove reception and reduce ghosts andsimilar reflections became increasingly pop-ular, and RCA was ready with a range ofinnovative antenna designs. In 1984, thedivision was awarded an engineering EMMYfor its pioneering role in the developmentof circular polarization for broadcast tele-vision.

Broadcast Systems entered a "new be-ginning" in 1984 with the move from Cam-den to Gibbsboro, N.J. A new buildingwith administrative, engineering, and pro-duction facilities was completed in theearly fall and was fully operational by24

1977-1984

22. The microprocessor controls of RCA's TK-47 color TV camera provide automatic set upand alignment-features which earned it anEmmy Award in 1981.

23. The G -line of VHF Transmitters developedby RCA now includes 26 models coveringpower levels from 10 kW to 100 kW.

24. RCA -designed antenna atop the WorldTrade Center's north tower in New York Cityis "topped out," as signified by the Americanflag attached to last antenna section put inplace.

25. Electronic Computer -Originated Mail (orE-COM) system for the U.S Postal Serviceunder test at RCA Government Communi-cations Systems in Camden, N.J.

26. Extensive testing of the AEGIS system iscarried out by resident Navy crew and RCAengineers under computer -simulated battleconditions at the Navy's Combat SystemEngineering Development site.

25

year end. This move consolidated all opera-tions of Broadcast Systems with the alreadyoperational Antenna Systems unit in Gibbs-boro.

Government Systems DivisionMissile & Surface Radar

The RCA Government Systems Division(GSD) work on the Navy's AEGIS weaponsystem represents the biggest defense pro-gram in RCA's history. The total dollarvalue since the program's inception in 1969exceeds $2.5 billion. AEGIS can simul-taneously and automatically detect, track,and engage multiple missile, aircraft, sur-face, and subsurface threats.

Built around a highly sophisticated radarsystem developed by RCA, the AEGIS sys-tem takes advantage of advanced electron-ics technology in radar, command and con-trol data processing, and communications.The system uses novel designs and circuit-ry, including specialized integrated cir-cuits.

The primary mission of AEGIS ships is todestroy hostile aircraft, missiles, subma-rines, and surface ships in order to prohibittheir employment against U.S. forces. AEGISships are normally assigned to carrier bat-tle groups or surface action groups. RCA'sdual role in the AEGIS program is uniquein the history of U.S. Navy Contracting. TheCorporation is the first independent con-tractor to be selected to perform systemsengineering for a total ship combat system.RCA is also the first to serve as primecontractor in the development, production,

26

integration, and testing of a complete wea-pon system for the Navy. In 1984, RCA Mis-sile and Surface Radar received a contractfor the design and development of theAEGIS Combat System that will be installedin the DDG51 class of guided -missile des-troyers. The lead ship in the multiyearbuilding program will be named ArleighBurke, after the famous World War II de-stroyer commander and later Chief of NavalOperations. DDG51 is scheduled for com-missioning in 1989.

Government CommunicationsSystems

During 1981, RCA Government Communi-cations Systems, part of GSD, developedand installed for the U.S. Postal Service anelectronic communications (E-COM) sys-tem that enables volume mailers to elec-tronically send computer -originated state-ments and letters to 25 cities. The E-COMsystem was operated successfully from 1982through 1984.

Among many communications programs,Government Communications Systems pro-vides Integrated Radio Rooms for Tridentballistic missile submarines. Developedunder a series of Navy contracts, theadvanced system controls submarine com-munications from a single console. The sys-tem gives Trident commanders a widerrange of communications capabilities thanever before. The Integrated Radio Roomalso has potential applications for othersubmarines.

Another computer -controlled communi-

1977-1984

cations system is being produced for theNavy's CG47 class cruisers. Designated theIntegrated Voice Communications Systems(IVCS), it uses two computer -assistedswitching centers to automate shipboardtelephone communications traffic. The sys-tem can be expanded to handle 2,000 to3,000 communication stations on largeships, such as aircraft carriers. The AEGISIVCS is an advanced version of equipmentdeveloped by GCS for the Navy's LHAassault ships.

Government Communications Systemsalso developed a family of small super-

high -frequency satellite communicationsterminals for the U.S. Army and U.S. AirForce. Transportable by trailer or lighttruck, they are designed to provide short -orlong-range communications within 20 min-utes after arrival at a chosen site.

Government Volume ProductionA new separate business unit, RCA Govern-ment Volume Production, was establishedto handle production programs like that forthe SHF satellite communications termi-nals. This business unit, which shares facil-ities with RCA Government Communica-tions, handles major production contractsfor U.S. government customers. One of itsfirst programs is a contract to build 111transportable ground stations and relatedequipment for the Air Force's satellitecommunications networks. This five-yearproduction contract calls for delivery offour types of ground stations and 250 low -rate multiplexers. Initial production in-cludes a large contract for secure-communi-

27

cations equipment that was an outgrowthof a research effort performed by RCAunder government contract. Later, the pro-duction program was expanded severaltimes. In late 1983, RCA was awarded asecure -communications production programbased on an equipment design provided bythe government. This program is being ful-filled by Government Volume Production.

Automated Systems

Automated Systems (AS), a business unitof GSD in New England, achieved a rapidannual growth rate through the years 1977-1984, mainly through its leadership indeveloping automatic test equipment (ATE)for electronic, communications, and auto-motive equipment. EQUATE, a third -gen-eration tri-service ATE -system was selectedas the U.S. Army standard for depot andintermediate -level maintenance. Systemsare being delivered worldwide to supportevery major combat system and combatsupport system in Army inventories intothe 21st century. Through the years to 1984,145 EQUATE Systems were ordered and 114delivered, with total contract values ex-ceeding $300 million.

AS's vehicle test system capabilitiescarried over to solve a more fundamental

testing problem. Simplified TestEquipment (STE) was developed for sol-diers to perform complex diagnostics onmilitary vehicles in the field. In 1981, theDavid Sarnoff Award for Outstanding Tech-nical Achievment was presented to the ASteam for its work on STE, and over 7,000test sets were delivered to support the M-1Abrams main battle tank, the Ml/M2 Brad-ley fighting vehicles, and all other Armycombat and training vehicles.

Another David Sarnoff Award was granted

28

to AS for the development and productionof the AN/GVS-5 hand-held laser range-finder. The AN/GVS-5 is part of AS's Com-mand, Control, Communications and Intel-ligence business area, which developedTCAC (Technical Control Analysis Center),tactical and strategic terminals and REM -BASS (Remotely Monitored Battlefield Sen-sor System), among other products. Thesesystems represented a wave of emergingtechnologies that are being applied to newmilitary readiness requirements.

Astro-Electronics

The entire 1977-1984 period was a majorone for the space endeavors of RCA Astro-Electronics. Twenty-five RCA -built satel-lites were launched into space since thecompany entered the field in 1958. SevenRCA Satcom domestic communicationssatellites were operating until RCA SatcomI was retired on June 4, 1984, after eightand a half years of service. RCA Satcom IIcontinued in operation, along with theother satellites in the RCA network: III -R,launched in 1981; IV and V, launched in1982, and I -R and II -R, launched in 1983.Satellites V, I -R, and II -R are Advanced RCASatcoms equipped with highly reliable all -solid -state power amplifiers. Each space-

ers in a redundant configuration thatallows 24 operating channels.

Astro Electonics entered a major ex-pansion program and put into operation aworldwide launch control network for track-ing, monitoring and control of communi-cations satellites as they orbit the Earthprior to being placed into equatorial orbits.

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1977-1984

27. Navy personnel work with an integratedradio room at RCA Government Communi-cations Systems in Camden, N.J.

28. Mechanics use simplified test equipmentbuilt by RCA to test and diagnose problemsin the U.S. Army's MI Abrams Main BattleTank.

29. Testing of one of the solid-state poweramplifers used in the communicationssatellites built by RCA Astro-Electronics.

30. Computer -aided design of solid-statecircuits al the Advanced TechnologyLaboratories.

31. At the Solid State Technology Center,Somerville, NJ, automatic bonding of wireswithin an integrated circuit device known asa 64 -lead flat pack.

32. RCA Service Company is known for itsnationwide network of service centersproviding prompt, reliable home service ofRCA TV sets, and certain other appliances.

30

The network placed RCA in a leadingposition in commercial satellite controloperations.

Also placed into operation by RCA wasthe nations's largest clean -pumped ther-mal vacuum chamber for testing satel-lites in a simulated space environment.The chamber can test half of a SpaceShuttle payload, including 15 -ton space-craft measuring 35 feet by 15 feet.

Astro-Electronics started work on fourRCA Satcom Ku -band satellites. (The firsttwo satellites were scheduled for launchin 1985.)

Also received were the following con-tracts for communications satellite systems:o Four dual -band "Spacenet" communica-tions satellites for GTE Spacenet Corp.Spacenets 1 and 2 were successfully launch-ed in May and November 1984. Spacenet3 is scheduled for launch in 1985.o Also for GTE, four Ku -band "GSTAR"communications satellites. GSTAR-I isscheduled for launch in 1985.o Three dual -band domestic communica-tions satellites for American Satellite Co.First launch will be in the summer of1985.

o A contract from NASA to design andbuild an Advanced Communications Tech-nology Satellite (ACTS) and supportingground stations. Direct Broadcast Satellites for SatelliteTelevision Corp. and United States Satel-lite Broadcasting Co. Inc. These satelliteswill broadcast directly to homes by way ofinexpensive, 24 -inch diameter, dish -shapedrooftop antennas.

In addition, Astro-Electronics continuedto build Advanced TIROS -N weather satel-lites for the National Oceanic and Atmos-pheric Administration (NOAA), as well asthe U.S Air Force's Block 5D defensemeteorological satellites. More than 50weather satellites have been launched

31

since 1960, when TIROS -1, the worlds's firstweather satellite, was launched.

The NOAA-8 and -9 spacecraft were thefirst American satellites equipped to assistin search and rescue missions. The numberof persons saved with the help of thesespacecraft reached 400 by the end of 1984.

In other space developments, RCA -builtNOVA navigation satellites were launchedfor the U.S Navy in 1981 and 1984, andNASA dual -launched a pair of DynamicsExplorer scientific satellites in 1981 tostudy the interactive coupling between theEarth's magnetosphere, ionosphere, andplasmasphere.

The Corporation also played a major rolein NASA's Space Shuttle program, withRCA equipment and services involved ineach flight from liftoff to touchdown. Shut-tle missions carry as many as eight televi-sion cameras that were designed and builtby Astro-Electronics. The shuttle's UHFradio system was developed by RCA Govern-ment Communications Systems.

RCA Service CompanyDuring 1977-1984, the RCA Service Com-pany set new sales records annually. Bydeveloping new advanced -technology busi-nesses, expanding existing businesses, andcultivating new servicing opportunities,the Company has met the increasing needsof its consumer, commercial, telephone,data, and government markets.

Consumer Services, while building andmaintaining a customer base of more thanone million service contracts on RCA homeentertainment products and Whirlpool ap-pliances, expanded its service capabilitiessignificantly in the past three years. In1983, the Service Company assumed the

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1977-1984

responsibility for the nationwide servicingof JC Penney home electronics productsand microwave ovens, accounting for anadditional 440,000 contracts in force. Alsoin 1983, Consumer Services helped launchthe first direct broadcast satellite (DBS)home TV service, installing and maintain-ing small earth stations and peripheralequipment. In 1984, Consumer Servicesinitiated a test of the microcomputer ser-vice market in the home and small busi-ness environments.

The Service Company's Commercial Pro-ducts activity maintained its leading posi-tion in providing commercial televisionreceivers and a wide range of communica-tions and entertainment products to thelodging, healthcare, educational and in-dustrial markets. In 1983, RCA beganmarketing a satellite TV receiving systemand premium entertainment programmingpackages for hotels and motels. Also in1983, RCA introduced two "dedicated" TVreceivers to its product line - a 9 -inchpersonal color TV for bedside use in thehealthcare market and a 25 -inch monitor/ -receiver having advanced design featuresfor industrial and educational applications.

RCA Telephone Systems installed itsone millionth line in 1983, despite theintense competition in the interconnectmarket. Throughout this period, the Ser-vice Company maintained its leadershipposition in the sale, installation, and ser-vicing of the telephone interconnect sys-tems. In 1984, RCA met the increasingcomplex high -traffic demands of its largebusiness and hotel customers by addingadvanced digital voice/data switching sys-tems to its product line. RCA currentlymarkets telecommunications and call -ac-counting systems manufactured by Mitel,Hitachi, TIE, and Summa Four.

Data Services sales and profits con-tinued to rise during the eight -year period.Growth in this activity stems from thelease, installation, and service of teleprint-

33

78

ers and peripheral equipment, as well asthe third -party maintenance of news, trans-portation, and commodities services andmicrocomputers. MAjor third -party custo-mers include American Airlines, for whichRCA provides service on reservation, opera-tion, and security terminals; the Reuters,UPI, and Commodity news services; and theNorland chain of restaurants and conven-ience stores. In 1982, Apple Computerselected RCA to be the exclusive third -party supplier of on -site maintenance ofApple's original equipment manufacturer(OEM) and national account customers. In1983, contract service was initiated in IBMpersonal computers. In 1984, RCA intro-duced a multiuser, multitasking work-station, designed to communicate withother workstations, terminals, mainframes,and peripherals in the office environment.

The Government Services activity ex-perienced significant growth while furnish-ing technical, educational, and supportservice to government customers in theU.S. and abroad. Contributing to recordsales and earnings were contracts awardedand renewed for the operation and mainte-nance of full-scale drone operations for theU.S Air Force; range instrumentation andcommunication for the testing and track-ing of missile and space operations for theAir Force; weapons testing at the MissileTest Project in Florida; remote Alaskan AirCommand aircraft control and warning sta-tions; flight simulation equipment for theAir Force and Navy; as well as the operationand support of several military bases, JobCorps Centers, and a variety of Defense,NASA, and other government programs andinstallations.

Communications -RCA Continues Its Leadership Traditions

RCA Communications, Inc. was establishedin 1981 to consolidate the Corporation'stelecommunications businesses and to pro-vide the overall strategic and financialplanning support that enables RCA tocompetemunications industry. The Communica-tions group is made up of four operatingcompanies. RCA American Communications(RCA Americom) provides domestic satel-lite services to the cable TV and broadcastindustry, to business, and to government.RCA Global Communications (RCA Glob -

34

corn) offers communications services tomore than 240 countries as well as withinthe United States. RCA Cylix Communica-tions Network (RCA Cylix) provides on-linedata network services, and RCA NetworkServices primarilytion's telecommunications network.

RCA Americom

In 1973, using channels leased from a Can-adian satellite, RCA became the first com-pany in the United States to operate adomestic satellite -communications service.By 1977, RCA Americom had reached aleading position in supplying satellitecommunications services to the cable tele-vision industry. This leadership continues.In 1984, for example, the company distrib-

35

1977-1984

33. RCA Service Company engineer conductsa post -installation check of the Mitel SX-2000integrated communications system recentlyinstalled al RCA's Broadcast SystemsDivision, Gibbsboro, N.J.

34. RCA installs and maintains satellitereceiving Earth Stations for hotels and othercommercial properties for distribution ofpremium TV programming andteleconferencing capability.

35. RCA operates and maintains multibandradar for electronic countermeasures andpattern -measurements at Egli nAir Force Base.

36. Two of the four antennas at the VernonValley, New Jersey earth station of RCAAmericom. Believed to be the largest suchfacility in the free world, this earth stationhandles voice, video, radio and datatelecommunications into and out of the Neu'York area, and via terrestrial extensions,

from Boston to Washington.

37. RCA Americom's CommunicationsConsole in Vernon Valley, N.J. providescontinuous monitoring of all communi-cations equipment within the earth stationand between the earth station and New YorkCity.

36

uted more than 30,000 hours per month ofprogramming to an estimated 36 millionhomes served by some 6,000 CATV systems.

In 1979, RCA Americom sold RCA Alas-com, its Alaskan service, to Pacific Powerand Light, but continues to provide satel-lite control services for Alaska's telephonecompany, Alascom, Inc. These servicescomprise operation of Alascom's space-craft, Aurora, which was launched by RCAAstro-Electronics in 1982 as Satcom V.RCA's first Advanced Satcom.

The company's commercial services havecontinued to expand over the years. In1983, a long-term contract was signed withMCI Telecommunications Corp. under whichRCA Americom would lease to the carrierlong-distance intermachine trunks con-necting the customer's switching centers.Similar agreements have been made withother alternative long-distance telephonecompanies as the nation's telecommunica-tions industry proceeds through divestiture.

During the same time period, the numberof private leased channels on the Satcomsatellite system increased to 12,500, mak-ing RCA Americom far and away thenation's leading domestic satellite carrierfor this service.

The NASA Shuttle video and data net-work operated by RCA Americom broughtto the public live coverage of the historicfirst launch and landing of the Space Shut-tle in 1981. The company continues to pro-vide coverage of the Shuttle missions aspart of its extensive government servicesnetwork.

A new type of satellite communicationsservice was announced in 1982 as the com-pany applied to the FCC to construct andoperate a series of spacecraft operating inthe Ku -band of the radio -frequency spec-trum. These satellites are scheduled for

37

launching starting in late 1985. This ser-vice is specially suitable for transmissionsserving satellite master antenna and direct -to -home television services as well as forthe development of direct -access privatebusiness networks for voice, data, andvideo communications. In 1984, the com-pany applied to the FCC to increase thetransponder power on its planned Ku -bandsatellites to 45 watts from 40. This increasewill make these the most powerful satel-lites in such service.

RCA Americom's in -orbit satellite fleethad grown to seven in 1983. At year end,Satcom I and Satcom II were used as in -or-bit spares. That year saw the inaugurationof the company's digital audio transmis-sion service, which has set the standard insuperior quality distribution of stereo net-work radio programs. ABC, CBS, NBC, andRKO radio as well as Westwood One, aleading syndicator, now use this service toaccess an estimated 2,500 radio stationsequipped with small receive -only antennas.The company also inaugurated its interna-tional video services in 1983. RCA Ameri-com has since expanded the service offer-ing it to and from 87 Atlantic Intelsatsignatory countries via its internationalearth stations in Etam, West Virginia andAndover, Maine.

From an historical perspective, the mostsignificant event for RCA Americom during1984 was the retirement of Satcom I andSatcom II from the orbital arc. These twospacecraft, which together logged over onebillion miles of travel, were largely respon-sible for the development of the nation'ssatellite communications industry.

By the end of 1984, the company'sgovernment services network had grown to44 antennas at 37 locations. Its commercialservices network was reaching 16 major

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1977-1984

metropolitan areas ranging from Boston toHonolulu.

RCA GlobcomThe 1977 to 1984 period was one of unprece-dented expansion of services and facilitiesfor RCA Globcom. Some of the major ser-vices introduced during this period includedhigh-speed international facsimile, telexaccess from computers, RCA Mail (full -ser-vice electronic mail), and domestic telexand leased channel services.

In 1978 the company introduced the firsthigh -quality, high-speed international fac-simile service, called Q -Fax, in concertwith Kokusai Denshin Denwa (KDD), theJapanese international telecommunicationscompany. Subsequently, this service wasexpanded to serve 28 overseas locations. In1980, RCA Globcom provided customerswith the ability to send as telex messagesASCII messages at 110 and 300 bits persecond (bps), such as from a personalcomputer.

Between 1977 and 1982, RCA Globcomexpanded its domestic gateway cities forinternational service to more than 80 cityareas, from 5 in 1976. In March of 1982, RCAGlobcom began offering domestic as wellas international telex service. During thesame year, RCA Globcom introduced itscomputer -to -telex service. This service en-abled customers to send and receive telexmessages at 300 and 1200 bps with theirpersonal computers. With access to RCA'snetwork as close as the nearest phone,every area of the country could now useRCA Globcom telex service.

In 1983, a domestic leased -channel ser-vice, ExpressNet, was inaugurated. Thisservice transmits data at speeds up to 1200bps and is suitable for both data and telexapplications. The company also began of -

38

fering DataLink service that enables over-seas customers to use telex terminals toaccess databases in the U.S.

Also in 1983 with its DDD-50 service,RCA began offering common telephone lineaccess from dedicated telex terminals.This service reduced the cost of direct con-nection to its telex service in anticipationof large increases in the rates for privateleased channels expected in 1985. Thecompany began offering an additional telexnews and information service in 1983

called "Hotline" in the United States andmarketed overseas as "FYI."

In 1984, Radio Page America was formed.This company, ajoint venture between RCAGlobcom and Page America Group, offerspocket radio message service and has beenreferred to as pocket telex. It is contem-plated that this venture will expand towardsa worldwide personal messaging service.

RCA Mail, a full -feature, sophisticatedelectronic mail system, made its debut inSeptember of 1984. The same service wasmade available through RCA Network Ser-vices to units of RCA Corporation.

The period of 1977 to 1984 was also onein which operations were carefully ana-lyzed, streamlined, and consolidated. TheLodi Communications Center and the PortArthur Marine radio station were closed.Rocky Point, originally known as RadioCentral when it was RCA Globcom's maininternational radio center in the days ofMorse code, was also closed. The com-pany's operating center in Piscataway, NewJersey, however, was expanded and by theend of 1984 handled virtually all of the

39

company's switched and leased services,including a much expanded AIRCON pub-lic shared -message switching system forlarger customers who develop and operatetheir own international networks usingleased channels.

RCA Cylix CommunicationsNetwork

In 1982, RCA Communications acquiredCylix Communications Network, a value-added data communications company. RCACylix is a satellite -based network providingend -to -end services for a wide spectrum ofindustries and applications. Routing databy RCA Satcom satellites, the network canlink any two or more locations in the Uni-ted States and Canada. At the heart of theRCA Cylix network is the central switchingsite in Memphis, Tennessee. The speciallyconstructed bunker is earthquake- and tor-nado -resistant, has back-up power sup-plies, and all network components are du-plicated for reliability.

Since the conversion to a satellite net-work was completed in 1981, RCA Cylix hasfocused a large share of its resources on thereliability of the network's technology. Atthe same time, customer service has beenviewed as an important aspect of the com-pany's product offering. RCA Cylix intensi-fied its commitment to providing reliabledata communications in January, 1985,with the introduction of the CustomerResource Team (CRT), a personal approachto customer service. The CRT service con-cept integrates each of the company'smajor operations departments into regionalteams of network specialists finely tunedto each customer's communications needs.

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1977-1984

38. This photo shows telex message beingsent via a public telephone from a hand-heldcomputer. Two-way contact with virtuallyany telex or TWX machine can be made byphone from a home computer or wordprocessor.

39. The first fully integrated electronic mailservice for business firms, called RCA Mail,offered by RCA Globcom, is designed tooperate with almost any type of computerterminal and can interface with telex.

40. An operations support director at RCACylix looks over network statistics in front ofequipment that converts digital signals intoradio -wave frequencies needed for satellitetransmission.

41. The examination of a design developedthrough CAD -CAM technology at RCALaboratories.

42. A recently installed high-energy particleaccelerator al RCA Laboratories in Princeton,N.J. provides scientists with a new tool inmaterials research.

41

RCA Network ServicesWith the formation of Network Servicesin1981, came an extensive examination ofall RCA's internal communications. Theobjective was to determine how NetworkServices could best provide existing andnew telecommunications services to thecorporation at cost as a service to the cor-poration. As a result of this examination,plans were made to improve TACNET,RCA's private long distance voice network(one of the largest in the United States) byreplacing the six AT&T switches through-out the United States with RCA owned andoperated switches. The substitution willbegin in February of 1985 and be accom-panied by the establishment of an RCAmicrowave link supporting the networkbetween New York and Camden.

In June of 1984 Nippernet, RCA's privatedata network was established making pos-sible communications among many dataterminals and host computers throughoutRCA, regardless of their interface compati-bility. At approximately the same time, anew group called Communications Con-sulting Services was formed by RCA Net-work Services. This telecommunicationsconsulting organization provides practicalsolutions to daily telecommunications pro-blems and assists in long-range planning. Itoffers information, expertise, and analyti-cal tools to its customers to help managetheir changing communications needs.These customers include real estate deve-lopers, hospitals, hotels and motels, otherbusinesses of all sizes, and governmentagencies. The group's services include tacit -

42

ities analysis, network design, user operat-ing support, and facilities management.

RCA LaboratoriesThroughout 1977-1984, RCA's central re-search organization, RCA Laboratories, con-tinued its program started in the early1970s of strengthening the working rela-tionships between the research and deve-lopment staffs of the product divisions andthe Laboratories.

To speed innovation's development intoproduct, satellite laboratories were estab-lished at product division headquarters.This arrangement began in the early 1970swhen the Solid State Technology Centerwas set up at the Solid State Division'sheadquarters in Somerville, New Jersey. Bythe end of 1981 there were four other satel-lite laboratories: the New Products, theManufacturing Technology, and the Ad-vanced Yoke Development Laboratories, allat Consumers Electronics in Indianapolis,and the Technology Transfer Laboratory atthe Video Component and Display Divisionheadquarters in Lancaster, Pa. These groupsprovide a close coupling between the pro-duct divisions and the Laboratories, there-by fostering communication and effectiveengineering development.

The establishment of Manufacturing Sys-tems and Technology Research Laborato-ries at RCA Laboratories in the mid-1970s-and their subsequent growth insize and status-is another factor in RCA'sgrowing technological strength. RCA earlyrecognized that, for a technical product to

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be successfully produced and marketed,innovation and advanced technology inproduct design requires innovation andadvanced technology in product manufac-turing. This recognition has enabled RCAto compete successfully with the Japanese,for instance, in the production of the top -rate color television receivers. During thisperiod RCA Laboratories spearheaded Com-puter -Aided Design and Computer -Aid Manu-facturing (CAD/CAM) technology to makepossible the creation of designs quicklyand efficiently.

Because of the close relationship betweenRCA Laboratories and the product divi-sions, the Laboratories are involved in bothlong-range and short-range research anddevelopment operations. One ongoing pro-gram is the development of a higher -defini-tion TV (HDTV) picture compatible withthe present NTSC broadcast standards.RCA also continues research on technolo-gies for a flat screen TV. In 1980 the Labora-tories demonstrated a basic technical con-cept for a 50 -inch (diagonal) color TVdisplay only about 4 inches thick. While theconcept remains viable, research efforts onflat panel TV have been redirected to betterunderstand the high -resolution capabili-ties of other technologies.

Several excellent examples of researchprojects that demonstrate the close rela-tionship of RCA Laboratories and the pro-duct divisions have been described pre-viously. Among them are the COTY-29 colorpicture tube, the "SelectaVision" Video -

43

Disc system, the TK47 microprocessor -con-trolled color TV camera, the use of charge -coupled -device (CCD) comb filters to improve substantially the horizontal resolutionof the TV picture, and the highly advancedsolid state portable TV camera using CCDchips.

In advanced television technology, RCAis developing digital television receivers.The processing of a television signal throughdigital techniques permits precision pic-ture control and promotes the introductionof new features while reducing the numberof electronic components. In High -Defini-tion TV research, RCA Laboratories areconstructing demonstration hardware tofurther evaluate the performance of futureTV systems. A major objective of the effortis to preserve compatibility with the pres-ent NTSC system.

In 1984, as part of an interdivisional RCAeffort, a new Information Systems Researchlaboratory was formed at RCA Laboratoriesto lay the groundwork for the developmentof a communications -oriented home infor-mation system. This laboratory is develop-ing the hardware and software that theconsumer would use.

In 1981, RCA Laboratories and RCAAutomated Systems demonstrated an ex-perimental infrared imager that by detec-ting temperature differences creates TVpictures in total darkness. The camera con-tains a high-performance solid-state imager,about the size of a dime, containing over800 infrared -sensitive elements. The heat -sensing camera has potential applicationsin the field of medicine to locate tumorsand blood clots, in industry as a detector44

for heat -leaking areas, in environmentalcontrol as a pollution -measurement system,and in the military for tracking planes,tanks, and personnel.

During 1977-1984, RCA Laboratories andGSD's Advanced Technology Laboratoriescontinued to improve an optical -disc mass -data -storage system, which features vastmemory capacity and quick random access.A major advance was the development of ahigh-powered solid-state laser-replacinga much more bulky and unwieldy gas las-er-for recording and retrieving data andpictures from optical discs up to 14 inchesin diameter. The proposed storage systemcould contain the complete EncyclopediaBritannica (100 billion bits of information)on one disc. In 1984, the Laboratoriesannounced its new multichannel opticalrecording system, by which three channelsof information can be recorded simultane-ously onto an optical disc using threesemiconductor lasers on a single chip. It isa major step in the development of a com-pact system that can store and retrieve vastamounts of information at extremely highspeeds.

Studies of direct broadcast satellite sys-tems to provide television, audio, and otherservices to individual and community re-ceiving stations were undertaken by theLaboratories and RCA Americom early in1981. The results have provided valuableguidance to RCA, NBC, and customers.

The RCA Satcom V, launched in 1982, isthe first commercial communications sat-ellite to use GaAs FET microwave amplifi-ers. These amplifiers were developed in acombined program by RCA Laboratories,

82

1977-1984

43. RCA Labs scientist aligns the optics of alaser used for multichannel high-speed datarecording. The new recording technique isconsidered a major step in the developmentof a compact system that can store andretrieve vast amounts of information atextremely high speeds.

44. In 1982, engineers and scientists fromRCA Automated Systems and RCA Labs.demonstrated the sensitivity of a heat -sensing image sensor. The inset at the lowerright shows a photomicrograph of the 64 x128 element infrared CCD image sensor.

45. Vision -assisted robot assembles parts alRCA robotics research laboratory.

46. Solid state power amplifier under test atRCA laboratories.

47. In the Zurich Laboratories, a member ofthe engineering development group works ona systems design.

45

gradual erosion in the combined audienceshare of the three commercial networkscaused by the inroads of cable, pay -TV, VCRand other rival technologies, and morecompetition from independent televisionstations. When the programming effortsfailed to stem a decline in NBC -TV's com-petitive position, a new management teamheaded by Grant A. Tinker was named inJune 1981. By the end of 1984, with suchnew hit series as "The Cosby Show" and"The A -Team," NBC-TV had advanced fromthird to second place in the prime -timeratings and was leading in those audiencegroups most attractive to advertisers.

NBC remained "the quality network"

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Astro-Electronics, and RCA Americom. Morereliable and durable than the tube unitsthey replace, the solid-state amplifiers alsoincrease the communications capacity ofthe satellite. The useful life of the RCASatcom satellites, which is now about 7years, is expected to increase to 10 years asa result of the amplifiers.

Also in microwave research, Laborato-ries scientists have been working with phy-sicians at several medical centers on theuse of microwave -induced heat for thetreatment of external and some internalcancers. Results have been encouraging.

Another noteworthy RCA Laboratoriesaccomplishment did not concern existingRCA products, but, rather, a possible futureproduct. To investigate alternative sources

of energy, an Energy Resource Laboratorywas established in 1977, the same year RCAreceived a basic patent on the use of amor-phous silicon-a low-cost but relativelyefficient material-in solar cells. Workingconstantly to improve the efficiency ofamorphous silicon solar cells, RCA Labora-tories researchers reached 6 percent in1980 and 7 percent in 1981. They "brokethe four -minute mile" in mid -1982 by reach-ing 10 percent conversion efficiency, amajor step toward large-scale power pro-duction. Despite the successful researchresults, it was determined that furtherdevelopment of solar cell technology wasnot compatible with RCA's long-range re-search goals and the technology was sold inits entirety to Solarex in 1983.

Entertainment-RCA Emphasizes High Quality

National Broadcasting Company(NBC)

The years 1977-1984 were a time of transi-tion at NBC during which the companyadapted to a changed broadcasting mar-ketplace and emerged with new strength.Over the period, revenues doubled, risingat an average annual rate of nearly 11 per-cent. Profits declined between 1978 and1981 due primarily to difficulties in theTelevision Network division-including a$33.7 million net loss resulting from theforced cancellation of NBC coverage of the1980 Moscow Olympics following the U.S.decision to boycott the Games. The slumpended in 1982, however, with a 32 percentrise in earnings, and NBC went on to exper-ience the highest profits in its history thefollowing year, a surge which continuedthrough 1984.

The 1977-1984 period was marked by

46

83

1977-1984

with award -winning programs such as "Holo-caust" (1978) and "Shogun" (1980). Themost honored drama series in televisionhistory, "Hill Street Blues," amassed 25Emmies during 1981-1984, a period in

which NBC led the networks year after yearin prime -time Emmies.

The NBC -Owned Television Stations Div-ision sustained record profits throughoutmost of 1977-1984. The NBC Radio Divisionsuccessfully adopted the "narrowcasting"approach of radio in the '80s, winning newspecialized audiences through two addi-tional networks, "The Source" and "Talk -net."

Under a $300 million 10 -year agreementwith Comsat General Corp., NBC in 1983became the first network to adopt Ku -bandsatellite distribution, assuring superiortransmission to affiliates. The system hasbeen successfully operated since January1985. In 1984, NBC-TV introduced the RCACCD television camera, which takes pic-tures in very low light and has unique spe-cial -effects capabilities. On July 26, 1984,NBC aired the first network TV broadcast instereo.

RCA Records

From 1977 to 1984, RCA Records improvedof the market, both in North

America and in major international mar-kets, including Latin America and theFar East. In addition to albums and cas-settes, RCA began marketing digital com-pact discs, the new state-of-the-art, laser -read format for recorded music.

Among the RCA artists who achievedprominence during this period are DollyParton, Kenny Rogers, Diana Ross, Ala -

48

bama, Rick Springfield, Daryl Hall & JohnOates, Irish flutist James Galway, and thenew British recording duo, Eurythmics. In1984, RCA began a year -long celebration ofElvis Presley's fiftieth anniversary. Pres-ley's recordings for RCA have sold in excessof one billion copies, worldwide.

During this period RCA added severalrecord companies to its wide distributionnetwork: Arista, in which RCA has anequity position, whose artists include AirSupply and Dionne Warwick; A&M, forwhich the Police and Supertramp record;and, outside of North America and Africa,Motown Records, home of such top -sellingartists as Stevie Wonder and Lionel Richie.

At the heart of RCA's automated, com-

puterized U.S. manufacturing and distribu-tion system are its Indianapolis pressingfacilities and warehouses, which servicethe entire nation. RCA also added strategi-cally located satellite "hits warehouses,"to provide extremely fast service on aregional basis for fast -selling new recordings.

Also during the 1977-1984 period, RCAbegan distributing the videocassettes ofColumbia Pictures Industries throughoutthe U.S. and in nine foreign countries. Inthe Direct Marketing division, RCA launchedthe Compact Disc Club, which offers laser -read digital audio discs from virtually everymajor record label. RCA's three recordclubs now service the popular, classical,and Compact Disc markets.

Other Businesses -RCA Streamlines and Strengthens Its Operations

The Hertz CorporationThe period 1977-1984 was one in whichHertz pioneered new and improved poli-cies and services for the rent -a -car indus-try. The most innovative new policy wasthe implementation of unlimited mileagerates on all rentals. This changed a 60 -year -old industry policy of charging timeand mileage on basic car rental rates.The new policy of a flat daily charge withno charge for mileage permits customersto know in advance the cost of their carrentals. The new policy was quicklydopted by others in the industry.

As car rental volume at airports con-tinued to grow and car rental counters

49

became increasingly strained, Hertz in 1980introduced Express Service to let frequenttravelers who are members of #1 Clubbypass the counters in the airport termi-nals and proceed directly to the ready -cararea where they complete their arrange-ments for the pre -assigned cars.

To expedite car return as well as carcheck-out, Hertz in 1983 introduced Ex-press Return at major airports. Availableto #1 Club members who are chargingtheir rentals on credit cards acceptableto Hertz, the computerized Express Returnsystem provides customers with instantreceipts for their car rental transactions.

1977-19 84

48. "NBC Nightly News" is produced anddirected from this control room in .NBC'sNew York studios.

49. Hertz rents and leases a variety ofequipment for construction and factory use.

50. Hertz's computerized reservation centerin Oklahoma City features the latest incommunications and data systems.

51. Coronet Industries lab technicians mixdye formulas for different shades of carpetcolors.

50

Hertz currently operates in over 120countries from more than 4,500 locationswith a fleet of nearly 400,000 rental andlease vehicles.

Coronet Industries, Inc.The years 1977-1979 were marked by recordsales and earnings return on sales asCoronet capitalized on its new innovativemulticolor dyeing technique. To expand itsproduct/coloration innovation, Coronet un-dertook major capital additions at both itsdomestic and Canada operations for newmulticolor dyeing equipment along withnew state-of-the-art continuous heat -setequipment that improved carpet qualityand performance as well as appearance.

During the last ten to fifteen years, yarnprices escalated rapidly in response to theshortage and subsequent price fixing of thepetrochemical feedstocks used in the manu-facture of carpet yarn fibers. The shortagewas brought on by an embargo on oil ship-ments from the Mid -East countries andprice fixing by the establishment of theOPEC Cartel. Coronet was able to recovermost of these cost increases because of itsstyle leadership. However, margins weredepressed.

In mid -1979 in a move to broaden itsproduct offering and to capitalize on theforecast rapid expansion of the commercialcarpet market segment, Coronet acquiredMarJon Carpet Mills, Inc. Prior to thisacquisition Coronet's line was primarilyresidential carpeting. This acquisition gave

51

Coronet immediate access to floor coveringusers such as offices, hospitals, motels, andother public buildings.

In 1980 as inflation reached double dig-its and interest rates reached peaks in thelow 20s. a recession hit the housing indus-try and carpet sales declined sharply.

The year 1981 was marked by the 25thanniversary of the founding of Coronet inthe year 1956. A new high-speed energy -ef-ficient Finishing Range was installed whichgave the carpet pile a finely tailored look inaddition to reducing the cost of the carpet.Marlon, the commercial carpet operationintroduced a new line called "Gibraltar" tomeet the needs of contract specifiers, inte-rior decorators, and architects.

In 1982 the U. S. economy was hit by amajor recession, accompanied by high in-flation and high interest rates, whichcaused a depressed market. Coronet, how-ever, launched a major transition of itsmanufacturing operations to eliminate ob-solete facilities, reduce overhead costs,and install new high-speed state-of-the-artmanufacturing technology. A major part ofthis transition was the shutdown and saleof its obsolete dyeing facilities and consol-idation of the dyeing process into the exist-ing finishing plant. Coronet Canada alsoeliminated obsolete facilities and installednew state-of-the-art equipment in 1982.

In 1983 Coronet continued its programof streamlining facilities and productivityimprovements. In a major move to reduceoverhead and provide more immediateaccess to the recently installed state -of -

85

1977-1984

the -art manufacturing equipment at itsDalton, Georgia facilities, the MarJon com-mercial carpet operations in Calhoun,Georgia were relocated and consolidatedinto the Dalton facilities. Additional ware-house space was constructed and addi-tional foam dye equipment was installed.

In 1984 key technical personnel changesand additions were made to strengthen theoverall organization. The latest of itsnewly acquired multicolor dye lines wasstarted up, which gave Coronet neededcapacity to support the sharp increase insales in 1984 over 1983. Sales in 1984reached an all time record high and keptCoronet as one of the top manufacturers inthe industry.

Divestments and AcquisitionsRCA Corporation's program of growththrough diversification began with theacquisition of Random House in 1966 andended in 1974 with the addition of two fooddistribution businesses England (OrielFoods and Morris and David Jones) to thecompany's already substantial interest inthe food industry in the U.S. Soon after,however, RCA began to sell off or discon-tinue selected portions of its businessesbecause they no longer fit or offered littleprospect of future growth.

The first major divestment came in 1976,with the sale of Cushman & Wakefield toRockefeller Center, Inc., and then RCAAlaska Communications, Inc., to PacificPower & Light Company in 1979, eachrepresenting an area of business activity inwhich RCA had no continuing interest forfurther investment.

In 1980, RCA adopted a formal plan todivest certain of its operations that wereseen as peripheral to those lines of busi-ness on which RCA intended to concen-trate its future attention. In the periodfrom 1980 through 1984, all of RCA's non-traditional businesses except Hertz,NACOLAH, and Coronet Industries weresold, including CIT Financial, which hadbeen acquired in 1980 in an effort to sta-bilize RCA's historically cyclical earningspattern. These divestments included sev-eral long -held technology -based businessesin which RCA decided not to continue.

Avionics Systems was sold in 1981 toSperry Corporation when it became ap-parent that RCA's leadership position incertain product categories could be sus-tained only with major new investment totake advantage of important new tech -

86

nology developments. Mobile Communica-tions was sold in 1981 and CablevisionSystems in 1983. In these activities, RCA'sposition had deteriorated unacceptably inhighly competitive market environments.

In 1981, RCA announced that it wouldhenceforth concentrate its resources onthe interrelated core areas of communi-cations, electronics and entertainment.Thus, as the divestment program con-tinued, interest developed in acquisitionsto expand the core businesses. The firstwas Cylix Communications Network, avalue-added data communications business purchased in 1982. Early in January1985, RCA purchased a minority interestin PageAmerica, Inc., a radio commoncarrier operator with whom RCA had beendeveloping a nation-wide radio paging ven-ture.

Future Prospects

The history of RCA recounted above showsthat the company in the main returned toits traditional and well established herit-age in electronics, communications, andentertainment - its "roots". RCA has beenand will continue to be the company thatintroduced and enhanced television, thatbrings you the nightly news, that transmitswords and pictures to and from the farcorners of this planet and beyond, thatbuilds satellites and electronic defensesystems. Its products range from the com-monplace and the ubiquitous to the highlycomplex and the very special.

What are our expectations for the future?RCA expects that the television set willevolve and merge with the functions of thehome computers and telephone systems tobecome the center of an entirely new con-cept in home entertainment and informa-tion. This evolved product will permit bothbroadcast reception and two-way commun-ications with educational institutions,

52

banks, retail stores, and a variety of data-bases. It will also have "stand alone" capa-bilities for such functions as word process-ing and keeping accounts that will exceedthose of today's personal computers and befar easier to use. Consumers will be able toretrieve information, make banking trans-actions, or shop from the home. A majorstep toward this goal has already beentaken with the establishment of the HomeInformation Systems Division that will beresponsible for developing consumer infor-mation services accessible through homecomputers.

RCA expects continued growth in itsgovernment systems business. In the deve-lopment of the AEGIS defense system forthe U.S. Navy, RCA has attained a leader-ship position at the highest technical levelin information collection and interpreta-tion. Our experience and our highly skilledscientists and engineers give us unusualstrength for developing information sys-tems for the future, both for governmentapplications and for the private sector.

RCA's communications businesses willcontinue growth, paced in large measureby satellites. "End -to -end" services for bus-inesses will be an increasingly importantcommunications product.

NBC expects that the turn -around in rat-ings will gain momentum and that its pro-grams will continue to receive both criticaland popular acclaim.

RCA has many great expectations inmany fields for its future, too many to belisted. By careful planning and astuteaction, however, we intend to transformthese expectations into practical businesssuccesses. At the close of 1984, RCA iswell positioned financially and in termsof momentum and required skills to makethese expectations become reality.

52. Work is underway at RCA Laboratorieson future products and services of the HomeInformation Systems Division.

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