The best answer is D. VHS producers formed “strategic alliances with other producers and distributors” that helped manufacture and market their product, whereas Beta manufacturers “were reluctant to form such alliances and eventually lost ground”.
Choice A is incorrect because it describes the strategy used by Beta producers.
Choice B is incorrect because, although VHS producers held an early lead in sales, they did not give up their advantage.
Choice C is also incorrect: the passage states that VHS manufacturers took advantage of “strategic alignments with producers of prerecorded tapes”, but no mention is made of a strict VHS monopoly on such tapes.