• U.S.

Industry: Peace, It’s Wonderful

2 minute read

One of the lengthiest and most acerbic feuds ever waged by two grown U.S. corporations ended last week. In a joint announcement, Radio Corp. of America and Philco declared that they had settled a six-year battle of claims, counterclaims and court suits over color television patents. Under a complicated out-of-court agreement, RCA will pay Philco $9 million for permanent patent rights on all its color TV processes; in addition, Philco will have access without charge to all RCA color patents granted before October 1958.

The fight started as a mere skirmish between television giants maneuvering for position in the uncertain color-TV market. Philco charged that RCA, with some 12,700 patents, was freezing other manufacturers out of color, and in an antitrust suit asked $150 million in treble damages. RCA in rebuttal accused Philco of patent infringements and false attacks on the reliability of RCA’s three-gun color tube, demanded $174 million in damages. As years went by, the fight descended into a hopeless tangle of side issues, including a Philco attempt to take over a Philadelphia television station operated by RCA’s NBC subsidiary.

When the Ford Motor Co. acquired Philco 13 months ago, RCA speculated rightly that Ford had no enthusiasm for continuing the controversy, and made overtures that led to last week’s settlement. Still far from clear is who comes out ahead. Philco, to be sure, gets the money. But RCA has such a commanding lead in color television sales that even by using RCA patents, Philco is likely to have a difficult time catching up.

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