As of September, Philips will no longer make televisions for the U.S. and Canada.
Instead, it is transferring that job to Japanese electronics maker Funai. The two companies agreed to a brand-licensing agreement in which Funai will source, distribute, market and sell all consumer TVs under the Philips and Magnavox brand names in the U.S. and Canada.
The deal begins September 1 and is good for five years. Funai will pay a royalty to Philips.
Beginning in September, Funai will distribute all Philips TV in the U.S. and Canada.
(Credit: Philips)"This agreement secures continued presence of Philips and Magnavox branded TVs in North America in a model that safeguards Philips profitability in this highly competitive market," Philips said in a statement Tuesday.
And so begins the thinning of the herd. The television market is becoming an especially tough business, as prices continue to fall and more inexpensive brands like Vizio and Olevia attempt to edge out the traditional market leaders. Pioneer, a leader in plasma TV tech, also recently announced it would sell TVs but no longer make its own plasma panels.
This means that though the Philips brand name will live on in the U.S., the materials inside those televisions aren't necessarily the same. But the biggest blow is to brand perception.
Philips is a top-tier television maker--it won the Best of CES 2008 Best in Show Award from my CNET Reviews colleague David Katzmaier for its Eco TV--and Funai is, well, not as a highly regarded. This is a boon to Funai, and Chief Executive Tetsuro Funai's comment is pretty much the understatement of the year: "As a premium brand, Philips will add lustre to our existing portfolio."
To be fair, Philips has definitely struggled to compete in the flat-panel TV market. Though the company has attempted to differentiate its brand with Ambilight technology aimed at home theater enthusiasts, it still trailed the big guys, like Sony, Panasonic, and Sharp, in both production and panache.
Now that Blu-ray has won the high-definition disc format war, the industry is moving on to the next step: recruiting companies to produce players and media.
And to help that process along, MPEG LA, the standards and licensing group, is floating the concept of a creating an organization that will be able to license all of the patents necessary to make Blu-ray products.
The idea was discussed back in early 2007 during a meeting of 18 of the holders of necessary Blu-ray patents. With the format war over, MPEG LA is once again talking up the concept. The mechanisms and rates for Blu-ray licenses have yet to be fully hammered out, industry sources say.
While Blu-ray backers talked up customer convenience and experience, royalties were at the heart of the Blu-ray push. A successful standard can result in millions of royalties every year for patent holders. The licensing fees for making an individual DVD player totaled $15 to $20 a few years ago. (For those of you who believe manufacturers should only adopt free and open standards, please feel free to spend 10 years of your life inventing a complex optical storage and retrieval standard.)
Philips and Sony garnered millions in revenue from CD licensing.
If one-stop shopping becomes a reality for Blu-ray, it would prevent one of the major headaches of the DVD world from repeating. To make a DVD player or disc, manufacturers have had to ink deals with three separate organizations, which represented various patent holders. There is DVD 6c (Hitachi, Panasonic, JVC, and six others), DVD 3c (Philips, Sony, Pioneer), and MPEG LA (representing encoders and decoders). To make a DVD player, manufacturers have to pay $4 to DVD 6c per player, $2.50 to MPEG LA, and I'm not sure about the amount to DVD 3c.
For DVD movies, DVD 6c charges about 4 cents per disc and MPEG LA charges 3 cents. I wrote an article last month on the subject but low-balled the royalties required.
Her Royal Highness will pwn your sorry hide!
(Credit: Official Royal Images Library)Here in the U.S., our head of state couldn't seem to master the Segway, but Britain's Queen Elizabeth II is apparently quite the video game diva.
The undoubtedly reputable U.K. publication The People reported earlier this week that the 81-year-old royal got a hold of a Wii console (according to a "Palace source," it belongs to her 25-year-old grandson, Prince William) and "showed all the signs of becoming a Nintendo addict."
The Queen's game of choice seems to be Wii Bowling (what, did you expect Call of Duty 3?) and the source told The People that her "hand-eye coordination was as good as somebody half her age."
Prince William, meanwhile, "was in fits of laughter," but allegedly will have a tough time prying the console away from his grandmother. She is, The People notes, an unusually tech-savvy dame. She has reportedly had a cell phone since 2001, a BlackBerry since last year, and listens to an iPod regularly. (The People reports that it contains over 100,000 songs, which means that Steve Jobs must have custom-made it for her since the 160GB version holds only 40,000 songs, tops. Hey, Brits, do some fact-checking!)
And we here at CNET suppose it's good that Her Majesty is raiding Prince William's video game library rather than Prince Harry's liquor cabinet.
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