During his two months in North America, Morita concluded export contracts for 1,000 microphones and ten tape recorders for radio news gathering. In addition, Bulova, a major U.S. watch manufacturer, expressed interest in the sample TR-52 model.
"Yes, your price is okay with us. We'll order 100,000 sets," Bulova said. The deal seemed as good as closed. But there was a catch: "We won't sell them under the Sony name. We'll have to market them under our own brand name. Nobody in this country has ever heard of Sony."
Morita was convinced that he should refuse, but he could not turn down an offer of this magnitude on his own. He returned to his hotel and cabled Japan: "Received order for 100,000 sets, but intend to turn it down due to the condition that they must use their own brand name."
The reply came back smartly: "Order for 100,000 sets is too large to let go. Forget the name, get the order." Morita understood only too well how they felt. But that was not a good enough reason to change his mind. He cabled back: "I want to refuse." At an impasse, Morita ended up phoning the head office and saying, "On no account should we permit the use of their brand name. We have our own, Sony, and we should stand by it. Apart from anything else, Totsuko cannot fill an order for 100,000 sets with our present production capacity." As the phone bill ate into his precious supply of dollars, Morita reasoned with his colleagues. Once he had their consent, he went to inform the prospective client.
Bulova's president was scornful of Morita's lack of business sense. "Whoever heard of Sony? Our brand has a worldwide reputation with 50 years of history behind it." "Fifty years ago, how many people knew your name?" Morita countered. "We are in the same position as you were then, and this is the first of our own 50 years. In 50 years' time we will have made the name Sony as famous as yours. So it's no, thank you. With Totsuko's future to consider, they could not afford to look just at short-term returns. Morita passed up the offer and headed home. It was April 1955.
The TR-52 had been nicknamed "the UN Building," a reference to the white plastic grid on the front of the cabinet. Just after Morita returned from this second overseas trip, a major disaster struck. It was May, the beginning of summer. As temperatures climbed, the front lattice section gradually peeled away from the black cabinet. It was not just one radio that was warped, but nearly all of the 100 sets that were manufactured so far. Ibuka and his team turned pale. The radios were unsalable. Immediately before this first Totsuko transistor radio was due to be officially introduced, they were forced to call off the launch.
The cabinet incident served as a good lesson. Instead of designing a product just based on external appearance and color scheme, Totsuko searched for an attractive yet durable material that would never lose its shape.
In August that year the remodelled TR-55 went on sale. It had the honor of being Japan's first transistor radio.