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Extraordinary Times

The Origin of the Sound Recording Industry
A Victor Emerges

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"It was a close race with failure even for me - neck and neck for a long time. I did not win by superior speed; it was a question of endurance."

-Eldridge R. Johnson

Seaman's business was in a state of uncertainty. The American Graphophone Company and its record subsidiary, Columbia, which represented the Bell and Tainter interests, took advantage of the situation and sued Seaman (and thus Berliner) for patent infringement. Seaman admitted the offense (though Berliner's design did not truly infringe), and left the Berliner company to drown in legal entanglements. In an agreement with Columbia, Seaman was allowed to proceed with selling the Zonophone.

By 1900, Berliner cancelled Seaman's sales contract. But he responded with an injunction that forbade anyone from selling Berliner products. Berliner couldn't even use the word Gramophone in reference to his own invention.

Stripped of the right to sell his own invention, Berliner's fate in the Gramophone Business seemed dismal. Johnson had invested his entire life savings of about $50,000 in plant expansion and labor force, expecting an increase in orders from Philadelphia and England. He now stood to lose everything he had worked for since first setting foot in a machine shop nearly 15 years earlier. He realized that his survival depended on distancing himself from Berliner, and thus the Seaman legal dispute.

Johnson promptly founded the Consolidated Talking Machine Company, with the help of Leon F. Douglass, who would become a major figure in his future ventures. Seaman retaliated again, claiming Berliner's Consolidated Talking Machine Company of America, formed earlier, and only as a holding company for his operations, proved the two were still working together to sell Berliner products. Johnson was forced to change his company name once again, to Eldridge Johnson: Manufacturing Machinist.

But Seaman, ever aggressive in the courts, prevented him from using the word Gramophone on his products. By 1901, Johnson was billing the Gramophone as a "Disk Talking Machine". He also registered a new trademark name, "Victor", and was using it in association with his products. In June of that year, Seaman again filed suit against Johnson, claiming his new company was a ruse to cover up his partnership with Berliner. This time, Johnson emerged victorious. With the Seaman threat out of the way, he began to make plans for a major business move. Johnson offered to buy out Berliner's interest in their production operation for an astounding $350,000, but was refused. Instead, they combined their patents and production facilities to form an entirely new company.

The Victor Talking Machine Company was incorporated in Camden, NJ, in October of 1901. Johnson released the first product line, bearing the name of Victor and the "His Master's Voice" logo. An agreement was made with the Gramophone Company, by which they would share the selling rights to the world markets. The Gramophone Company would sell to the British Empire and Europe, The remaining Berliner Gramophone Company of Montreal would handle Canada, and Victor would have rights to North America, South America and China.

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