Philips exits the audio business: "underperformer"

[GP49]

> Royal Philips Electronics NV (PHIA), 50 years after unveiling the
> compact cassette for music mixtapes, agreed to sell its audio and
> video unit to focus on more profitable cancer scanners and
> energy-saving light bulbs.
>
> Japan’s Funai Electric Co. will pay 150 million euros ($202 million)
> in cash and a license fee for the Lifestyle Entertainment unit, said
> Amsterdam-based Philips, which also invented the compact disc with
> Sony Corp. The deal is part of a revamp that helped quarterly
> profit beat analysts’ estimates.
>
> Philips Chief Executive Officer Frans van Houten is pushing the
> manufacturer into high-margin areas such as lighting products that
> save energy and health- and wellness offerings to move away from its
> consumer-electronics past...
>
> “Lifestyle entertainment has been an absolute underperformer in the
> consumer lifestyle business,” said Rabobank analyst Hans Slob, who
> has a “buy” rating on the stock. “It’s definitely positive news Van
> Houten is taking more steps to improve the margins, by divesting this
> low-margin business.”
>
> The deal for the audio unit will probably close in the second half of
> 2013, while the video business will transfer in 2017 because of
> intellectual property licensing arrangements, Philips said.

Philips Sells DVD Business as Health Demand Boosts Profit

[1tumbleweed]

Philips has had problems in the consumer electronics arena for decades. The story in the industry is that, in all the years they owned Magnavox (and associated US TV business), they never made a dime. They ended up selling that business to Funai as well.

I was a rep for Marantz during the period that they were owned by Philips, and everyone seemed in agreement that the best thing that ever happened to Marantz was getting away from Philips. Some people forecast doom for the Denon/Marantz affiliation, but it certainly seems to have worked out so far - for both companies.

Funai is a very sharp company. They first started making inroads into the US by making VCRs sold under other brand names, and have edged their way bit by bit. Their stuff is by no means cutting edge, but it's not junk, either.

By the way, one of the first things I learned while selling Marantz was the comment, "Stop anyone on the street in Europe and ask them what Philips makes, and they'll tell you light bulbs."

[mr_fred]

too bad -- I had a nice Philips shortwave radio during my time in the Peace Corps (Liberia, 1976-78). Truly, it was a great radio.

[coonmanx]

I have a couple of Philips flash drives. Nothing in the way of audio equipment.

[typesix]

My mom had a Magnavox VHS/DVD combo unit made by Funai(it's still made) that had the VHS die within a year and the DVD quit two years later despite only been used less than 10 plays. Lot of online horror stories with Funai made stuff of recent years .

[33&athird]

Never really listened to much of Philips gear, the one thing that I have is a Magnavox CD player, which is quite nice, but I attribute that to Magnavox. Also have(had) a Philips/Magnavox TV that lasted a good long while, pretty decent stuff.

Just checking the philips wiki page to check some years, I had no idea it was founded to sell moving-coil speakers, which the founders invented...all the way back in 1918

[reggaenaut]

Philips just could not compete against the Asian Power houses. The emergence of South Korea has exacerbate the struggle.

[frommerstop]

My first CDP was a Sylvania branded top loader made by Philips... it still works, some 30 years later! I used to have a really nice 80wpc integrated amp by Philips too, I can't recall the model... 386 maybe?, not sure, but it was a great amp, much better than the run of the mill Japanese stuff from the late seventies.

[Battra92]

Originally Posted by 1tumbleweed

By the way, one of the first things I learned while selling Marantz was the comment, "Stop anyone on the street in Europe and ask them what Philips makes, and they'll tell you light bulbs."

Kind of like GE over here. :P

Well, maybe not around here (close to the capital region of NY) since GE had manufacturing plants in Western MA and in Schenectady NY people seemed to be loyal to GE. When my wife and I were house shopping most of the older houses had several vintage GE appliances. Kind of neat to see how they evolved over the years, style wise.

The only Phillips product I ever had success with was a DVD player I got on Woot that, thanks to a few button presses, is region free and will convert PAL to NTSC.

[1tumbleweed]

Originally Posted by frommerstop

I used to have a really nice 80wpc integrated amp by Philips too, I can't recall the model... 386 maybe?, not sure, but it was a great amp, much better than the run of the mill Japanese stuff from the late seventies.

Very nice amp, I remember seeing one of those years back. Magnavox-era Philips design, made in Japan but likely not by Marantz.

[chicks]

I built some speakers way back in the late '60's - early '70's using Philips drivers, IIRC a 1" dome and an 8" mid/woofer.

Only current Philips product is one of their earliest CDP's. Still works flawlessly.

[ebacon]

I briefly owned a Philips PC sound card a little over ten years ago. The software was buggy as hell so I changed to a Creative Labs SoundBlaster.

[Arkay]

I have a 54" Phillips Plasma TV on in the room as I'm typing this. It works great! These models were a little more expensive than some when they first came out, but were known for picture quality. The built-in sound isn't bad for TV sound, either (although I use other devices for better sound quality, as most people do). They sold well enough initially, but I don't think they kept up with the competitors like Samsung when it came to lowering prices, though, and over time became marginalized.

Years ago, a similar thing happened with CD players. Phillips had some of the best CD drives ever made for a few years --some of them were OEM'd into some big-bucks name-brand hi fi units-- but after a while they lost the edge to competitors making larger numbers of cheaper units. I have one of those CD players, and it still sounds good. Also a DCC player that likewise works (when I can be bothered to use it; too few tapes to make much use of it! LOL).

A little sad to see them leave this market, but it's understandable. Companies need to focus on where they are competitive, and cut business lines where they aren't. "Survival of the fittest" applies to corporate life, just as much as to organic life.

[Battra92]

Originally Posted by chicks

I built some speakers way back in the late '60's - early '70's using Philips drivers, IIRC a 1" dome and an 8" mid/woofer.

Only current Philips product is one of their earliest CDP's. Still works flawlessly.

I really wish there was a modern CD player or transport that looked like that. I would certainly buy that. Why can't gear look cool like that instead of black boxes? :P

[coonmanx]

I forgot that my Speakerlabs use Philips soft dome tweeters which are really nice. Goldwood is now making copies of them. My Avid 102s which are in the need of cabinets right now also use Philips tweeters.