MCA, Sony: Why mergers didn't work
It seemed like a good idea at the time. With a booming stock market at home and robust markets abroad, Japan's cash-rich consumer-electronic makers came to the United States six years ago to marry their expertise in making entertainment "hardware" with Hollywood's world-dominating "software."</br></br>But the sum of those parts--the buzzword was "synergy"--has never come close to exceeding the whole, it's clear now. Instead, Japanese have learned painfully that movie and TV shows can't be cranked out like VCRs or memory chips.</br></br>Matsushita Electric Industrial Co.'s sale of 80 percent of MCA Inc. to the Canadian beverage conglomerate Seagram Co., which industry sources say will be announced officially on Sunday, represents only the latest misadventure by a Japanese industrial conglomerate in American entertainment.</br></br>Sony Corp. has posted huge losses on its $3.2 billion purchase of Columbia and Tri-Star Pictures in 1989. Japan Victor Co. and Pioneer Electronics Corp., two other Japanese electronics companies that made smaller investments in independent film companies, also are still waiting to see their first profits.</br></br>While the individual circumstances vary, the common problem for these companies, say observers, has been the culture gap between Japan and Hollywood. As mystifying as some Americans may find Japan, they say the Japanese fundamentally misunderstood how to manage the hit-or-miss business of entertainment.