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Carlton takes step into video discs

CARLTON Communications yesterday took a further step into the world of cutting-edge entertainment technology by paying pounds 160m for Nimbus Technologies, a leading manufacturer of video discs.

The move will help silence critics who questioned Carlton's reliance on manufacturing and distributing video cassettes in the midst of sweeping technological changes.

Carlton already owns California-based Technicolor, the world's biggest producer of pre-recorded video cassettes. It hopes to expand Nimbus, a leading maker of video discs, alongside Technicolor.

Video discs have superseded previous technologies in the drive to put visual and audio recordings on to a disc format. They are the size of a compact disc but can store more data, with better clarity of sound and vision than video cassettes.

A previous attempt to market new video technology by Philips, the electronics giant, failed to take off. Philips introduced laser discs - akin to CDs but the size of a vinyl album - over three years ago. However, video discs - also known as Digital Versatile Discs - are proving more popular. Last year over 200,000 video disc players were sold in the US. That compares to sales of 100,000 video recorders when they were introduced in 1975.

Video discs also generate fatter profit margins for their manufacturers because they are cheaper to make than CDs, but sell at higher prices.

Prices for the discs are usually around $25 (pounds 15) in the US, compared to $10 for CDs. They cannot yet be used to record films, although more than one film can be stored on each disc.

Michael Green, chairman of Carlton, said: "Just as the company added video cassettes to its film operations in the 1980s, now we are adding optical discs in the 1990s. Penetration of VCRs, DVD players and PC disc drives are all growing as part of the world expansion of screen-based entertainment."

Lydon Faulkner, chairman and chief executive of Nimbus, said: "Nimbus and Technicolor are an excellent match, and we look forward to working with one of the most respected names in the packaged media industry. We believe there is great potential for rapid growth as a supplier of [video disc] products to the home entertainment and computer software industries."

Nimbus has been a leading manufacturer of video discs - as well as compact discs - since it entered an alliance with Philips in 1982.