This Time, a Maximum Effort for the Mini

It’s baaaack.

Six years after Sony’s ill-fated introduction of the MiniDisc as an alternative to the CD, the 2.5-inch disc is being resurrected--this time as a portable, recordable alternative to the audiocassette.

At the Consumer Electronics Show in Las Vegas last week, Pioneer Electronics and Yamaha unveiled their first MiniDisc players for the U.S. market. JVC said it would reenter the market, while Aiwa, Denon, Kenwood and Sharp all introduced expanded player lines.

Sony, which launched the format in December 1992, kicked off a yearlong promotional campaign it hopes will help boost MiniDisc player sales this year to 500,000 units--more than twice the number shipped in 1997--and propel the format to 5% household penetration by 2000.

“We’ve talked to thousands of consumers, and we believe the timing is perfect,” said Mark Viken, senior vice president of personal audio-video products for Sony Electronics. “People are not real happy with the cassette.”

“I don’t want to knock it--the audiocassette has been around for 30 years and it remains one of the most successful audio products ever launched,” he said. “But sales have been declining, and our research tells us that consumers are ready for a digital format to replace what the cassette has done for them.”

Sony’s ad campaign, which Viken said is the largest audio product advertising and marketing program the company has ever mounted, revolves around the theme “Make It With MD.” The company will spend an estimated $30 million and will include extensive retail promotions, co-branding opportunities and sponsorships.

The campaign will begin Feb. 5 during NBC’s top-rated Thursday night prime-time lineup, with a series of teaser spots featuring various celebrities Viken declined to identify. The ads will run through Feb. 9, when the yearlong media blitz officially kicks off.

Sony will also introduce an array of MiniDisc products, including three home MD players with suggested retail prices of $360 to $480; two bookshelf component systems ($360 and $800, both including a three-disc CD changer); four portable MD players ($250 to $550); and two car MD players ($450 and $600). The portable players will be rolled out between now and May, with home systems hitting the market over the summer. Car players will be available beginning next month.

Other consumer electronics manufacturers are following suit. Among them are Sharp, which in February will introduce two portable player-recorders, priced at $500 and $350, along with two MiniDisc “bundles” that include a portable player and a home component deck.

Kenwood plans to offer a full line of MiniDisc products for car, home and personal use, including a six-disc car changer that will retail for $600. Pioneer Electronics, a newcomer to the MiniDisc field, will release its first home player in June for about $400.

“The MiniDisc has been very popular in Japan,” said David McCullough, a Pioneer brand manager. “It has a very big appeal to the younger consumer because of its size, its portability and the high cost [in Japan] of CDs. So we decided to introduce it here in the United States to complement our new line of recordable CD players.”

McCullough said Pioneer wants to wait and see how well its home unit is received before releasing a portable player; he concedes that the Walkman crowd will ultimately make or break the MiniDisc.

“You definitely have a more knowledgeable and upscale consumer who finds the MiniDisc offers better quality than the cassette, and the price points have come down to where it’s more attractive than ever,” McCullough said. “But at this point, our strategy is to get people familiar with the recording ability of the MiniDisc, and then offer them a portable player later.”

When the MiniDisc format was introduced in the U.S. in 1992, it was almost instantly relegated to the heap of failed technologies that includes eight-track cartridges, Beta videocassettes and Quadrophonic audio sound systems--at least, in the public’s eye.

In truth, Viken said, the format never went away--it just grew a lot slower than expected. “We have had reasonably good success, but it hasn’t been an explosion,” he said.

Viken blames the lackluster debut on a combination of timing and Sony’s failure to properly deliver its MiniDisc message.

“If you look at 1992, the CD was still in an amazing growth stage,” Viken said. “People were still converting their LP collections to CD, and the MiniDisc didn’t appear to offer them anything new. We did a lot of soul-searching about two years ago, and we realized that we could have done a much better job getting our message across.

“At the time of the launch, we were talking about instant access and the digital disc quality rather than portability and recordability. We were trying to explain all the great things about the MiniDisc in one fell swoop, and the message that came across to consumers was that here’s an alternative to the CD.”

This time, Viken said, the message will be clear.

“We want people to look at the MiniDisc as a replacement for the audiocassette in the digital world,” he said. “Many people today have more than 1,000 CDs in their libraries. They love the CD, and while it’s transportable to some degree, they see it as a great home-based system.

Viken said Sony’s optimism for the relaunch is buoyed by the MiniDisc’s success in Japan, where the penetration rate is now well over 25% and more than 70% of all audio products sold include a MiniDisc player. He also points out that players are a lot more affordable than the first MiniDisc models Sony put on the market five years ago, which cost upward of $800.

And the software has come down in price as well, from an initial $15 in 1992 to street prices of less than $5 today. Viken said about 600 prerecorded MiniDisc titles are also on the market today, mostly from Sony Music artists. While that’s slim pickings compared with the hundreds of thousands of CD titles currently available, Viken isn’t worried.

“Recordability will drive interest,” he said.

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Thomas K. Arnold is editor in chief of Video Store magazine, a weekly trade publication serving the home entertainment industry.