This article is from the rec.audio.* FAQ, by with numerous contributions by Bob Neidorff others.
The HiFi recording format is subject to two different problems:
Head-switching noise and compression errors.
To get perfect reproduction, the FM subcarrier waveform being
played back by one audio head must perfectly match the waveform
from the other head at the point of head switching if a glitch
is to be avoided. If you record and then play the tape on the
same VCR under exactly the same conditions, you have a
reasonable chance of this working. But if the tape stretches
just a bit, or you play it on another VCR whose heads are not in
exactly the same position, or the tracking is off, the waveforms
will no longer match exactly, and you will get a glitch in the
recovered waveform every time the heads switch. This sounds
like a 60 Hz buzz in the audio, which is often audible through
headphones even if not through speakers.
The same glitch will occur in the video waveform too, but since
head switching always happens during vertical retrace, you won't
Some VCRs have azimuth correctors or Dynamic Track Following
which minimize these problems (Philips V2000 and some VHS).
The wonderful signal to noise ratio of VHS HiFi is achieved
through the use of compression before recording and expansion
after playback. The actual signal to noise ratio of the tape
itself is about 35 dB and a 2.5:1 compressor is used to
"squeeze" things to fit. Like all companders, this produces
audible errors at certain places on certain signals, such as
noise "tails" immediately after the end of particularly loud
Worse, compressors often have problems simply getting levels
right. That is, if you record a series of tones, starting at
-90 dB and working up in 1 dB increments to 0 dB, and then play
them back, you will almost invariably have level errors. The
trend from soft to loud will be there but the steps won't be
accurate. Two or three of your tones might come out at
essentially the same level, then the next one takes a big jump
to catch up or even overshoot.
For music, the result will be that the relative levels of some
instruments, passages, etc. will not be accurate.
This doesn't matter as much for movies, which tend to have
steady volume level. Also, movie enjoyment is rarely hurt by
these level errors. VHS and Beta HiFi is fine for reproduction
of movie and tv soundtracks. They are also perfectly fine for
non-critical audio applications. But VHS and Beta HiFi are not
serious competitors to DAT, CD, open-reel analog tape, or even a
high quality cassette deck.