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RCA and GE


This note deals with RCA and GE.


It covers -

  • introduction
  • General Electric
  • GE and the NBC takeover
  • RCA
  • RKO
  • studies

Introduction

As the discussion of NBC elsewhere on this site has suggested, NBC (and other media interests such as RKO) have been situated at the heart of the US 'financial-industrial complex', associated for much of their existence with the GE electrotechnical colossus and major financial interests such as those centred on the pre-1930s Morgan banking group.

General Electric

GE dates from the 1892 merger of Edison General Electric (embodying most of Thomas Edison's electrical patents) with competitor Thomson-Houston. The group initially encompassed lighting, gramophone, motor (particularly for streetcars), electricity generation and transmission interests but within a decade had expanded into machinery for business and domestic appliances. By 1912 it had assets of around US$132 million, annual sales of around US$89 million and 60,000 staff.

In 1905 GE formed Electric Bond & Share (EBASCO) to finance establishment and growth of electricity utilities. The group subsequently became one of the three dominant US gas and electricity utility holding companies - with control of eg American Power & Light, Idaho Power, Pennsylvania Power & Light, Texas Power & Light, Montana Power and Florida Power & Light - before spinning off its assets after 1943 following the Supreme Court's decision in Electric Bond & Share v SEC affirming the 1938 Public Utility Holding Co Act. EBASCO also expanded through investment in Latin America and other regions. GE distributed EBASCO's stock to its shareholders in 1924.

GE and the NBC takeover

GE had revenue in 2003 of US$134.7bn, earnings of US$15.1bn and assets of US$575bn, with around 315,000 employees in over 100 nations. It ranks as the 5th largest US company by sales and is the 8th largest in the world. GE Capital, which accounts for over 50% of the group’s profits, would rank as the 9th largest company in the US and 30th largest in the world.

Following the NBC Universal deal GE has been continuing to acquire and dispose of substantial assets, with for example acquisition of the UK-based Amersham radiopharmaceuticals group in 2003 for US$9.5bn.

As of June 2004 GE comprises

  • Capital
  • Appliances
  • Industrial Products and Systems
  • Medical Systems
  • Power Systems
  • Aircraft Engines
  • Advanced Materials
  • Technical Products and Services
  • NBC

GE Capital embraces consumer credit cards, equipment leasing, health insurance, home mortgages, airplane leasing, consumer lending, commercial lending, large project financing and financial guaranty insurance. The Medical Systems Division includes magnetic resonance, ultrasound, and computed tomography scanners; patient monitoring systems; clinical information systems and the Patient Channel, a television network aimed at the captive audience in hospitals.

GE Power Systems products include nuclear reactors, turbines, compressors and generators. It also provides fuel and support services and equipment that supports oil and gas distribution. The Aircraft Engines Division manufactures and services jet and turboprop engines, along with marine engines and industrial power sources.

GE Advanced Materials encompasses GE Plastics (high performance polymers, plastics compounding, and sheet and films), GE Silicones (adhesives and sealants for industries ranging from construction to aerospace to healthcare), and GE Quartz (material for semiconductors, lamps, fibre optics and crucibles).

RCA

[under development]

The history of RCA parallels that of Westinghouse: stunning early success followed by a mix of technological innovation, engineering excellence and strategic indirection as executives wandered on a diversification safari rather than maintaining existing markets and fending off expansion by Japanese and European consumer electronics groups such as Matsushita and Electrolux.

RKO

The Radio Keith Orpheum film group - more commonly known as RKO and distinguished by its radio transmission tower logo - integrated feature film production, distribution and exhibition at the height of the 'studio system'. It was was formed in 1929 when RCA merged its film interests with the Film Booking Office (FBO) studio and KAO, absorbing Pathe Exchange in 1930 and became the distributor for Disney.

In 1948, amid jitters about dismantling of the studio system and demands for investment in television RCA sold a controlling stake to Howard Hughes.

Hughes exited in 1955, splitting RKO into RKO Pictures (a production and operation operation) and RKO Theaters (real estate and cinema operations). RKO Pictures was sold to General Teleradio, an arm of emerging conglomerate General Tire & Rubber, for US$25 million. In 1959 it was rebadged as RKO General Inc, exploiting its film library (with many features ultimately acquired by Ted Turner) and selling its studios to Desilu Productions. General Teleradio subsequently expired in controversy over alleged impropriety at its television broadcasting stations. RKO Theaters was absorbed by Cineplex Odeon.

RKO and its successors are considered in a more detailed profile elsewhere on this site.

Studies

There's been no comprehensive history of General Electric and much of the coverage comprises triumphalist biographies of figures such as Welch or Owen Young.

For its significance in technological development see Bernard Carlson's Innovation as a Social Process: Elihu Thomson & the Rise of General Electric, 1870-1900 (Cambridge: Cambridge Uni Press 1991), Leonard Reich's The Making of American Industrial Research: Science & Business at GE and Bell, 1876-1926 (Cambridge: Cambridge Uni Press 1985) and George Wise' Willis R Whitney: General Electric & the Origins of US Industrial Research (New York: Columbia Uni Press 1985). A perpective on EBASCO is provided by Jose Gomez Ibanez' 1999 The Future of Private Einfrastructure: Lessons from the Nationalisation of Electric Utilities in Latin America, 1943-1979 (PDF) and Louis Brandeis' Other People's Money, available here.

Ronald Kline's Steinmetz: Engineer & Socialist (Baltimore: Johns Hopkins Uni Press 1992) is an account of the leading technocrat. For 'Neutron Jack' Welch see Welch: An American Icon (New York: Wiley 2001) by Janet Lowe, The New GE: How Jack Welch Revived an American Institution (New York: McGraw-Hill 1992) by Robert Slater and Jack: Straight From the Gut (New York: Warner 2001) by Jack Welch & John Byrne - boys with very large toys. There is a less ebullient account in Thomas O'Boyle's At Any Cost: Jack Welch, General Electric & the Pursuit of Profit (New York: Random 2001).

David Nye's Image Worlds: Corporate Identities at General Electric, 1890-1930 (Cambridge: MIT Press 1985) and Thomas Hughes' Networks of Power: Electrification in Western Society, 1880-1930 (Baltimore: Johns Hopkins Uni Press 1983) are exemplary. A point of reference is provided by Astrid Zipfel's Public Relations in der Elektroindustrie - Die Firmen Siemens und AEG 1847 bis 1939 (Cologne: Böhlau Verlag 1997).

The major history of RCA is Robert Sobel's RCA (New York: Stein & Day 1986). Benjamin Aldridge's The Victor Talking Machine Co (New York 1964) offers a view of RCA's roots. Context is provided by The Global Jukebox: The International Music Industry (London: Routledge 1996) by Robert Burnett, An International History of the Recording Industry (London: Cassell 1998) by Pekka Gronow & Ilpo Saunio and Timothy Day's A Century of Recorded Music: Listening to Musical History (New Haven: Yale Uni Press 2000). Margaret Graham's RCA & the Videodisc (Cambridge: Cambridge Uni Press 1986) considers why RCA dropped the ball, influencing Sony's decision to create both content and hardware.

There is a similar account in Homer Oldfield's King of the Seven Dwarfs: General Electric's Ambiguous Challenge to the Computer Industry (Los Alamitos: IEEE Computer Society Press 1996), the major study of the failure of GE and other consumer giants to achieve success as computing hardware/software manufacturers. It's complemented by Simon Partner's Assembled In Japan: Electrical Goods & The Making Of The Japanese Consumer (Berkeley: Uni of California Press 1999) and Alfred Chandler's Inventing the Electronic Century: The Epic Story of the Consumer Electronics & Computer Science Industries (New York: Free Press 2001) Jefferson Cowie's intelligent Capital Moves: RCA's Seventy-Year Quest for Cheap Labour (New York: New Press 1999) looks under the hood.