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March 27, 1997updated 05 Sep 2016 12:41pm

PHILIPS SEEKS GREATER BRAND RECOGNITION IN US

By CBR Staff Writer

A household name across Europe but little known as a product brand in the US, $40bn Philips Electronics NV is trying to raise its profile in North America. The company’s Magnavox brand of televisions, VCRs and other home appliances are now branded Philips/Magnavox and later this year the company’s Personal Communications group will begin selling the cellular phones it already offers in Europe under its own name in the US market. As part of the exercise Philips has sent some of its more established US units out on a tub-thumping mission to raise interest in the company’s products and services. The $4bn Philips Semiconductors group – formerly Signetics Inc – was one of the bright spots in Philips’ disappointing fourth quarter in which it made a loss from ordinary operations of $43m. The group also managed to buck the general decline in the chip business; since we do not sell memory products, we were able to show positive though moderate nominal growth of 6% (in dollar terms 1%), said Arthur van der Poel, chairman of Philips Semiconductors. The group expects to grow by more than that margin this fiscal year, mainly by exploiting the convergence of audio, video, graphics and communications in home appliances and PCs. It is placing large stall by its TriMedia multimedia digital signal processor, although the chipset was originally promised this quarter but is now put off until later this year (CI No 3,023). The unit says Apple Computer Inc’s restructuring plans haven’t tempered its enthusiasm for the part. Philips has traditionally been closely allied to Motorola Inc on microprocessors – its Signetics unit, which became Philips Semiconductor – was an official 68000 second source, and it still uses a variant of the 68000 in its Compact Disk-interactive games and educational multimedia system. However it sees a dwindling future for the part and for RISCs, hitched its wagon to the MIPS Technologies Inc star a couple of years ago after a brief flirtation with Sun Microsystems Inc’s Sparc camp, licensing the basic R-series design for embedded applications. Its first and only major MIPS part, which it calls the One Chip PDA, was actually announced back in 1995 (CI No 2,082), though the chipset wasn’t foundried at Philips and the company still hasn’t produced a MIPS-based controller of its own. The unit says it’s going to have another go at marketing the PDA chipset this year, presumably because the PDA market is only now beginning to develop the potential which was wrongly forecast to materialize a couple of years ago. It is currently readying a new line of the Paradise graphics controllers it picked up with its 1995 acquisition of Western Digital Corp’s multimedia products unit (CI No 2,759). Philips Semiconductor has 26,000 employees, the vast majority at its assembly plants in South East Asia. It has 15 manufacturing sites in 11 countries and five R&D centers. It claims to be the world’s tenth largest semiconductor manufacturer – behind Intel, NEC, Motorola, Hitachi, Toshiba, Texas Instruments, Samsung, Fujitsu and Mitsubishi – and the fourth biggest in Europe. It does $3bn on integrated circuits and $1bn on discrete semiconductors. In North America its primary market is telecoms, accounting for 35% of sales; consumer and multimedia, 25%; automotive, 17% and other, 23%.

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