Philips

Koninklijke Philips Electronics N.V. (Royal Philips Electronics)

Type	Public (Euronext: PHIA, NYSE: PHG)
Founded	1891 Eindhoven
Headquarters	Amsterdam, the Netherlands
Key people	Gerard Kleisterlee, CEO
Industry	Electronics
Products	Consumer electronics Domestic appliances Lighting Medical systems
Revenue	▲€26.976 billion (2006)[1]
Operating income	▲ €1.183 billion (2006)[1]
Net income	▲€5.383 billion (2006)[1]
Employees	125,500 (2007)[2]
Website	www.philips.com

Philips HQ in Amsterdam

Koninklijke Philips Electronics N.V. (Royal Philips Electronics Inc.), usually known as Philips, (Euronext: PHIA, NYSE: PHG) is one of the largest electronics companies in the world, founded and headquartered in the Netherlands. In 2006, its sales were €26.976 billion^[1] and it employed 128,615 people in more than 60 countries.^[1] Philips is organized in a number of sectors: Philips Consumer Lifestyle (formerly Philips Consumer Electronics and Philips Domestic Appliances and Personal Care), Philips Lighting and Philips Healthcare (formerly Philips Medical Systems).

History

The company was founded in 1891 by Gerard Philips, a maternal cousin of Karl Marx, in Eindhoven, the Netherlands. Its first products were light bulbs and other electro technical equipment. Its first factory remains as a museum. In the 1920s, the company started to manufacture other products, such as vacuum tubes (also known worldwide as 'valves'), In 1927 they acquired the British electronic valve manufacturers Mullard and in 1932 the German tube manufacturer Valvo, both of which became subsidiaries. In 1939 they introduced their electric razor, the Philishave (marketed in the USA using the Norelco brand name). Also on March 11th, 1927 Philips went on the air with a station called PCJ now known as Radio Netherlands. It was broadcast to the Dutch East Indies. The host of the first broadcast was Eddy Startz and from 1927 until he retired in 1969 hosted a show called Happy Station. The only time the station went off air was when the Nazis invaded Holland. At the end of the war PCJ changed its name to Radio Netherlands and has been broadcasting to this day.

The company was also instrumental in the revival of the Stirling engine.

World War II

On May 9, 1940, the Philips directors were informed about the German invasion of the Netherlands to take place on May 10. They decided to leave the country and flee to the United States, taking a large amount of the company capital with them. Operating from the US as the North American Philips Company, they managed to run the company throughout the war. At the same time, the company itself was moved to the Netherlands Antilles (just on paper) to keep it out of German hands.

It is also believed that Philips - both before and during the war - supplied enormous amounts of electric equipment to the German occupation forces, which has led some people to think that the company collaborated with the Nazis, like many other firms in their day. However, there is no evidence to suggest that Philips itself or its management ever sympathized with the Nazis or their ideologies. The only Philips family member who did not leave the country, Frits Philips, saved the lives of 382 Jews by indicating to the Nazis that they were indispensable for the production process at Philips^[3]. In 1996, he was awarded the Yad Vashem reward by the Israeli ambassador for his actions. There is little Philips could have done to prevent the Germans from abusing their production facilities and forcing their employees to perform slave labor during the occupation. The production facility in Eindhoven was the only Dutch industrial target that was deliberately bombed by the allied forces during the war.

Postwar era

After the war the company was moved back to the Netherlands, with their headquarters in Eindhoven. Many secret research facilities had been locked and successfully hidden from the invaders, which allowed the company to get up to speed again quickly after the war.

Philips introduced the audio Compact Cassette tape in 1963 and was wildly successful, though its attempt to set a standard for video cassette recorders, the V2000, was unsuccessful in the face of competition from the Betamax and especially VHS standards. It had introduced a video cassette recorder system in the early 1970s, the N1500 could record/play for about 30 minutes while the N1700 extended this to over 1 hour.

In 1982, Philips developed the Compact Disc in partnership with Sony.

In 1991, the company's name was changed from N.V. Philips Gloeilampenfabrieken to Philips Electronics N.V. At the same time, North American Philips was formally dissolved, and a new corporate division was formed in the U.S. with the name Philips Electronics North America Corp.

In 1997 the decision was made to move the headquarters from Eindhoven to Amsterdam, along with the corporate name change to Koninklijke Philips Electronics N.V. The move was completed in 2001. Initially, the company was housed in the Rembrandt tower, but in 2002 they moved again, this time to the Breitner tower. In a sense, the move to Amsterdam can be considered a return to the company's roots, because Gerard Philips lived in Amsterdam when he came up with the idea of building a light bulb factory. He also conducted his first experiments in the field of mass production of light bulbs there, together with Jan Reesse. Philips Lighting, Philips Research, Philips Semiconductors (spun off as NXP in September 2006) and Philips Design, are still based in Eindhoven. Philips Healthcare is headquartered in both Best, Netherlands (just outside Eindhoven) and Andover, Massachusetts, United States (near Boston).

Sale of semiconductors

As a chip maker, Philips Semiconductors was among the Worldwide Top 20 Semiconductor Sales Leaders.

In December 2005, Philips announced its intention to make the Semiconductor Division into a separate legal entity. This process of "disentanglement" was completed on 1 October2006.

On 2 August 2006, Philips completed an agreement to sell a controlling 80.1% stake in Philips Semiconductors to a consortium of private equity investors consisting of Kohlberg Kravis Roberts & Co. (KKR), Silver Lake Partners and AlpInvest Partners. The sale completed a process, which began December 2005, with its decision to create a separate legal entity for Semiconductors and to pursue all strategic options. Six weeks before, ahead of its online dialogue, through a letter to 8,000 of Philips managers, it was announced that they were speeding up the transformation of Semiconductors into a stand-alone entity with majority ownership by a third party. It was stated then that "this is much more than just a transaction: it is probably the most significant milestone on a long journey of change for Philips and the beginning of a new chapter for everyone – especially those involved with Semiconductors".

In its more than 115 year history, this counts as a big step that is definitely changing the profile of the company. Philips was one of few companies that successfully made the transition from the electrical world of the 19th century into the electronic age, starting its semiconductor activity in 1953 and building it into a global top 10 player in its industry. As such, Semiconductors was at the heart of many innovations in Philips over the past 50 years.

Agreeing to start a process that would ultimately lead to the decision to sell the Semiconductor Division therefore was one of the toughest decisions that the Board of Management ever had to make.

On 21 August 2006, Bain Capital and Apax Partners announced that they had signed definitive commitments to join the expanded consortium headed by KKR that is to acquire the controlling stake in the Semiconductors Division.

On 1 September 2006, it was announced in Berlin that the name of the new semiconductor company founded by Philips is NXP Semiconductors.

Coinciding with the sale of the Semiconductor Division, Philips also announced that they would drop the word 'Electronics' from the company name, thus becoming simply Koninklijke Philips N.V. (Royal Philips N.V.).

Corporate affairs

In 2004, Philips abandoned the slogan "Let's make things better" in favour of a new one: "Sense and Simplicity".

ASM Lithography is a spin-off from a division of Philips.

Origin, now part of Atos Origin, is a former division of Philips.

Its record division, Polygram, was sold to Seagram in 1998 to form Universal Music Group.

CEOs

Past and present CEOs:

• 1891–1922: Gerard Philips
• 1922–1939: Anton Philips
• 1939–1961: Frans Otten
• 1961–1971: Frits Philips
• 1971–1977: Henk van Riemsdijk
• 1977–1981: Nico Rodenburg
• 1982–1986: Wisse Dekker
• 1986–1990: Cornelis Van der Klugt
• 1990–1996: Jan Timmer
• 1996–2001: Cor Boonstra
• 2001 to date: Gerard Kleisterlee

Acquisitions, subsidiaries and spinouts

Acquisitions

Companies acquired by Philips through the years include Amperex, Magnavox, Signetics, Mullard, VLSI, Agilent Healthcare Solutions Group, Marconi Medical Systems, ADAC Labs, ATL Ultrasound, portions of Westinghouse and the consumer electronics operations of Philco and Sylvania. Philips abandoned the Sylvania trademark which is now owned by SLI (Sylvania Lighting International) except in Australia, Canada, Mexico, New Zealand, Puerto Rico and the USA where it's owned by the Osram unit of Siemens. Philips also owns the light-emitting diode manufacturer Lumileds. In 2006 Philips bought out the company Lifeline Systems headquartered in Framingham, Massachusetts. In 2007 Philips acquired the company Ximis, Inc. headquartered in El Paso, TX for their Medical Informatics Division.^[4] In October 2007, it purchased a Moore Microprocessor Patent (MPP) Portfolio license from The TPL Group.

On Friday, 21st of December 2007 Philips and Respironics, Inc. announced a definitive merger agreement pursuant to which Philips will commence a tender offer to acquire all of the outstanding shares of Respironics for US$66 per share, or a total purchase price of approximately €3.6 billion (US$5.1 billion) to be paid in cash upon completion.^[5]

Spinouts

Polymer Vision ^[6], the maker of The Readius ^[7], is a spin out from Philips Electronics.

Sports, sponsorships and naming rights

Traditionally Philips has a vested interest in sports, originally as a means to provide a healthy form of recreation for its employees. In 1913, in celebration of the Centenary of Dutch independence from France, Philips founded a sports club called Philips Sport Vereniging (Philips Sports Club), or PSV, as it is now known. The sports club encompasses all kinds of sports, but is currently most famous for its Premier League football team and its swimming team. Philips owns the naming rights to Philips Stadion, located in Eindhoven, which is home to Dutch football team PSV Eindhoven.

Abroad, Philips sponsors and has sponsored numerous sport clubs, sport facilities, and events. Philips recently (November 2008) extended its very successful F1 partnership with AT&T Williams to include many more product groups.

Furthermore, Philips owns the naming rights to the Philips Arena in Atlanta, Georgia and to the Philips Championship, the premier basketball league in Australia, traditionally known as the National Basketball League. Between 1988 and 1993 Philips were also the major sponsors of The Balmain Tigers, an Australian rugby league team.

Outside of sports Philips sponsors the Philips Monsters of Rock festival, held in many countries all over the world.

Worldwide presence

Philips also used to sell major household appliances (whitegoods) under the name Philips. After selling the Major Domestic Appliances division to Whirlpool Corporation it changed via Philips Whirlpool and Whirlpool Philips to Whirlpool only. Whirlpool bought a 53% stake in Philips' major appliance operations to form Whirlpool International. Whirlpool bought Philips' remaining interest in Whirlpool International in 1991.

Australia

Philips in Australia has its headquarters in Sydney, New South Wales. The company employs over 400 people nationwide.
Regional offices are located in Melbourne, Brisbane, Adelaide and Perth.
IT services are provided by P-GIS (CAS, CIS & BTS).

Current operating divisions/activities include;

• Philips Healthcare (also responsible for New Zealand operations)
• Philips Consumer Electronics
• Philips Lighting (also responsible for New Zealand operations)
• Philips Dictation Systems

Philips Australia was founded in 1927 and has been involved in many activities over the years, esp manufacturing.
Today it is essentially a sales and support office.

As a result of Project LION (divestment of semiconductors), Australia's ranking rises from 43rd in the Philips world in terms of turnover to 18th.

Brazil

Philips do Brasil was founded in 1924^[8]. In 1929, Philips started to sell radio receivers. In the 1930s, Philips was making its light bulbs and radio receivers in Brazil. From 1939 to 1945, World War II forced Brazilian branch of Philips to sell bicycles, refrigerators and insecticides. After the war, Philips had a great industrial expansion in Brazil,and was among first groups to establish in Manaus Free Zone. In the 1970s, Philips Records was a major player in Brazil recording industry. Nowadays, Philips do Brasil is one of the greatest foreigner companies in Brazil.

China

In early 2008 Philips Lighting, a division of Royal Philips Electronics, opened a small engineering center to adapt the company’s products to vehicles in Asia. ^[9]

India

Philips started operations in India at Kolkata (Calcutta) in 1930 under the name Philips Electrical Co. (India) Pvt Ltd, comprising a staff of 75. It was a sales outlet for Philips lamps imported from overseas.

In 1938 ,Philips India set up its first Indian lamp-manufacturing factory in Kolkata. After the Second World War in 1948, Philips started manufacturing radios in Kolkata. In 1959, a second radio factory is established near Pune.

• In 1957, the company is converted into a public limited company, renamed "Philips India Ltd".
• In 1965 on 3rd April, the millionth Philips radio is manufactured in India.
• In 1970 a new consumer electronics factory is started in Pimpri near Pune. (This factory was shut down in 2006.)
• In 1982, Philips brought colour television transmission to India with the supply of four outdoor broadcast vans to DD National during the IX Asian Games.
• In 1996, the Philips Software Centre was established in Bangalore (It is now called the Philips Innovation Campus).
• In 2008, Philips India entered a new product category, water purifiers designed and made in India, and exported to other countries.

As of 2008, Philips India has about 4,000 employees.

Mexico

• The Philips Mexicana SA de CV corporate office is based in Mexico City

There several manufacturing plants in Mexico, some are:

Philips Lighting in:

• Monterrey, Nuevo León
• Ciudad Juárez, Chihuahua
• Tijuana, Baja California

Philips Consumer Electronics in:

• Ciudad Juárez, Chihuahua

Philios Domestic Appliances used to be manufactured in a large factory in Industrial Vallejo sector of Mexico City but was closed in 2003-2004.

Poland

• European financial and accounting centre: Łódź
• Philips Lighting: Pabianice, Piła
• Philips Domestic Appliances: Białystok

United Kingdom

Philips UK has its headquarters in Guildford, Surrey. The company employs over 2500 people nationwide. Official website in the UK.

• Philips Applied Technology, Redhill, Surrey develops new products and sub-systems including digital TV and communication technologies.
• Philips Healthcare Informatics, Belfast develops healthcare software products.
• Philips Business Communications, Cambridge offers voice and data communications products, specialising in Customer Relationship Management (CRM) applications, IP Telephony, data networking, voice processing, command and control systems and cordless and mobile telephony.
• Philips Consumer Products, Guildford provides sales and marketing for televisions, including High Definition televisions, DVD recorders, hi-fi and portable audio, CD recorders, PC peripherals, cordless telephones, home and kitchen appliances, personal care (shavers, hair dryers, body beauty and oral hygiene ).
• Philips Dictation Systems, Colchester, Essex.
• Philips Lighting: sales from Guildford and manufacture in Hamilton, Lanarkshire.
• Philips Healthcare, Reigate, Surrey. Sales and technical support for X-ray, ultrasound, nuclear medicine, patient monitoring, magnetic resonance, computed tomography, and resuscitation products.
• Philips Research Laboratories, Redhill, Surrey. Originally these were the Mullard Research Laboratories.
• Philips Semiconductors, Hazel Grove, Stockport, Greater Manchester and Southampton, Hampshire, both also earlier part of Mullard. These now become part of NXP.

In the past, Philips UK also included

• Consumer product manufacturing in Croydon
• Philips Domestic Appliances: Electric kettles production at Hastings
• London Carriers, logistics and transport division.
• Mullard Equipment Limited (MEL) which produced products for the military
• Pye Telecommunications Ltd of Cambridge
• TMC Limited of Malmesbury

United States

Philips' American headquarters is Philips Electronics North America Corporation, 1251 Avenue of the Americas, New York City, New York.[1] Official website in the US.

Philips Lighting has its corporate office in Somerset, New Jersey

with manufacturing plants in:

• Danville, KY
• Bath, NY
• Salina, KS
• Fairmont, WV
• Paris, TX

distribution centers in:

• Mountaintop, PA
• Ontario, CA
• Memphis, TN
• Atlanta, GA

Philips Healthcare is headquartered in Andover, Massachusetts. The North American sales organization is based in Bothell, Washington. There are also manufacturing facilities in:

• Andover, MA
• Bothell, WA
• Cleveland, OH
• Foster City, CA
• Milpitas, CA
• Reedsville, PA

Philips Domestic Appliances and Personal Care Company has its corporate office in Stamford, Connecticut. It has a manufacturing plant in Snoqualmie, Washington which makes Sonicare electric toothbrushes.

Philips Research has a laboratory in Briarcliff Manor, NY.

In 2007, Philips has entered into a definitive merger agreement with North American luminaires company Genlyte Group Incorporated, which provides the company with a leading position in the North American luminaires (also known as ˜lighting fixtures"), controls and related products for a wide variety of applications, including solid state lighting. Philips has also been ranked as the most award winning company in the United States of America.

Major consumer electronics products

Philips Videopac G7000

1951 - introduced the Philishave two-headed rotary shaver, marketed in the USA under the Norelco name.

1963 - introduced the Compact cassette.

1978 - introduced the laserdisc player, using technology invented in the 1960s.

1979 - introduced the Video 2000-system: a technically superior design, but a commercial failure.

1982 - launched the Compact Disc in partnership with Sony.

1991 - introduced the CD-i, the Compact Disc Interactive system which had many video-game console-type features,^[10] but was not a sales success .

1992 - launched the ill-fated Digital Compact Cassette format.

1995 - manufactured the Atari Jaguar's CD add-on for Atari.

1999 - launched the Super Audio CD in partnership with Sony.

2001 - successfully launched the Senseo coffeemaker, first in the Netherlands and from 2002 onwards, in other countries across Europe. It produces coffee by brewing from custom-made pads containing coffee grounds. The original Senseo pads are produced by Douwe Egberts. The Senseo has been available in the US since 2004.

2004 - Philips HomeLabs research center created the Mirror TV technology used in their MiraVision television line.

2006 - introduced the Blu-ray Disc in partnership with Sony.

2008 - introduced flatscreen with WOW VX technology. (3D tv)

2008 - introduced the Relationship Care range of Philips Intimate Massagers to the UK market.

The company receives a royalty on every DVD manufactured.^[11]

Healthcare products

See also

• Philips Records
• Philips Classics Records
• SpeechMagic

Spin-offs

• Atos Origin
• ASML Holding
• NXP Semiconductors

References

External links

General

• Philips Global - access to world wide local sites, research, consumer products, Healthcare, lighting etc.
• Royal Philips Electronics NV - Fact Sheet - Hoover's Online
• Bloomberg report on Semiconductors spinoff (Dec 2005)
• Member of the Digital Watermarking Alliance - Furthering the Adoption of Digital Watermarking
• Photo history of Philips and Eindhoven

Semiconductors

• Philips to sell majority stake in semiconductors business to private equity consortium KKR, Silver Lake and Alpinvest — Press release 2006-08-03
• NXP Semiconductors
• NXP Semiconductors - related articles

Lighting

• Philips Lumileds Lighting Company - LED Lighting
• Lighting Distributor
• Genlytegroup

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