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A video room refers to a room set aside at most fan run conventions to show TV episodes, movies, or songvids. The video room is usually staffed by gofers, and con reports are filled with their comments on the running, or sometimes more often, the problems in running, this room.
It is not the same as a Vid Show.
Video Rooms Then
Blooper reels were popular favorites and at some general purpose science fiction conventions, fans were often treated to previews of films being released over the summer. Some video rooms were large and could seat hundreds, but many rooms had to fit within a hotel room. Larger conventions could afford to rent out ballroom space with large screen projectors, smaller conventions made do with the hotel room, a TV and a VCR. In the 1970s and 1980s, before VCRs became widely available, video rooms relied on projectors and 16mm film. In addition, prior to VCRs, video rooms offered fans an opportunity to watch episodes of shows that were not airing in their area or that they had missed.
Wrangling these early videos could be tricky, though. "Concerning films -- especially Trek episodes: first, there is only one official copy of the Blooper Reel in existence. It belongs to Gene Roddenberry and cannot be gotten legally from any other source. Mr. Roddenberry occasionally brings it along with him to conventions he attends, or sends it with Dorothy Fontana or Susan Sackett. In the past few years it has become extremely expensive to rent Trek episodes. Various Hollywood Guilds -- Directors', Actors', etc. -- have decided they want a piece of the action. So you pay Paramount its rental fee -- $300 to $500 per episode -- and on top of that you pay each of the guilds a fee based on how many of their members were involved in producing the specific episode. (The guilds in turn pass on the money.)" 
Programming could either be pre-selected by the convention organizers in advance or available on a sign-up basis with attendees supplying the videotapes (or a combination of the two).
Because the video equipment was already on site and set-up, video rooms often doubled as space for technical panels on art and vidding (and in later years computers) and a few conventions even allowed fans to use VCRs to make copies of tapes (aka duping). A few video rooms ran 24/7 but most had to be staffed during regular hours due to the amount of requirement and videotapes stored on-site.
In the late 1980s and the 1990s, the video viewing rooms were sometimes a subject of controversy as some fans felt that the younger generation was more interested in watching movies and television in these rooms than in interacting with other fans. [need some quotes]
Video Rooms Now
- "The video room moved from the consuite to the downstairs ballroom. More room to see stuff as it was happening (nothing pre-programmed -- if you didn't watch the board every day you'd miss something)." From Jane Mailander's Friscon convention report, 1997.
- "The Balticon Video Room presents current and past, familiar and obscure science fiction, fantasy and horror videos for your entertainment and enjoyment." From the Balticon flyer.
- In the S&H letterzine, a fan says that the shows are not being rerun in her area, and that “all we have to tide us over are fifteen poor quality video taped episodes which we guard with our lives. We get together at my house every Monday night to talk zines, ideas, and sometimes watch an episode.” She pleads for there to be a video room at Zebra Con #4.
- In the Between Friends letterzine another fan writes: "Which brings me to complaint #2, which was a real one in terms of programming. I was very disappointed that there was no video room. I had really looked forward to seeing a lot of tapes."
- Sandy Herrold remembers Escapade 1995: “The vid room went to Open Video this year, and got a real work out. I showed Megan's Starsky and Hutch blooper tape to a few people, who then showed it to a few more...It must have been played 20 times during the weekend. They also had the B7 and Red Dwarf blooper reels...” 
- "The video room showed the best angsty/slashy eps of S&H, Pros, X-Files and Voyager, British documentaries about Pros and S&H, season openers of Sentinel and Due South, and other treats." From Jane Mailander's Zebracon convention report, 1997.
- "The Video Room was a treat as always -- a genuine theatre, with big soft chairs that *rocked* -- and this year it was a tad warmer than the arctic blast that had greeted us last year. Video treats such as episodes and movies were interspersed with music vids based on said video treats, slash and gen alike. ... Two small clumps of time were reserved purely for music videos ..." From Jane Mailander's Mountain Media Con report, 1997.
- "*Saturday Morning in the Video Room 10 a.m. to 12 noon: HOW TO MAKE SONG VIDS -- A Demonstration of video making." From the 2006 Revelcon flyer.