<roflmao>
...nuts & bolts //// bits & gigabytes....
Its all the same ain't it?
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Philip sseeks digital market lead
Reuters Story - March 03, 1998 18:07
By Philip Blenkinsop
AMSTERDAM, March 3 (Reuters) - Philips Electronics NV
wants to be the world's leading supplier of digital
consumer products, the chief of its new consumer electronics
division told Reuters in an interview.
"My aspiration is to be the number one in digital products.
That's what we drive for. In reality it's going to be a
significant battle," said Doug Dunn, chairman and chief
executive of the Consumer Electronics division established at
the start of this year.
"We're number three in the world in consumer electronics. I
expect to be better than that in digital products."
In Europe, Dunn said he expected the number of digital
television receivers to rise to five million by the year 2000,
although he would not say what market share Philips was
targeting.
The consumer electronics chief was in Amsterdam to launch
Philips range of new consumer products ahead of the CeBIT
computer fair in Hannover later this month.
Dunn said Philips would launch 15 products "of importance,"
with a further 20 or so of the "less earth-shattering" variety.
Last year, he said, marked a sea-change at the company -- with
the aggressive thrust of the likes of CD recordable, DVD, flat
panel televisions and digital still camera -- and this year was
a further advance.
"In the middle of 1996, we had a very poor product
development process in place with very few innovative
products...My message is that I want that tempo increasing as
time goes on with new innovative products being brought out more
quickly," Dunn said.
Philips' new approach is to launch a series of products and
discover which is successful, rather than provide the customer
with whatever Philips happens to make.
"Quick to market, range of products, see which ones really
take off and push them hard.... that's the new style," Dunn
said.
Costs, he said, were not unduly higher. The variety of
products had increased the R&D spend for example, but Philips
policy of increasingly outsourcing software production and unit
manufacturing to third parties had capped any escalation.
But profits, Dunn said, should rise.
"We don't only focus on individual products to launch. We
will launch concepts, generics, like home theatre.. built up of
many products... so we can reduce the risk of focusing on one
black box."
One cost that certainly is increasing is marketing. Last
month, Philips chairman Cor Boonstra pledged one billion
guilders both for information technology and for advertising.
Of the extra billion, Dunn said roughly half was to be spent
on advertising to trumpet the Philips brand.
One key battleground will be the United States. Dunn said
expenditure on advertising had increased, brand recognition had
risen and for certain of its newer products, notably the digital
ones, Philips would replace Magnavox as the brand name.
"We're now linking Philips to Magnavox... We migrate from
Magnavox to Philips Magnavox and most of our innovative digital
products will be launched as Philips...We're now among the top
100 spenders on marketing products in the USA."
Dunn says Philips can achieve all this without compromising
company targets of double-digit earnings growth and 24 percent
return on net operating capital.
"I don't think there's any conflict here... We can do these
things and remain profitable to the level to which we have
established ourselves," he said. |
