Thomson Eyes New Home Phone Strategy

CARMEL, IND.— Thomson's residential telecom business, Atlinks, will expand to offer "convergent technologies and networking products" under the GE brand as well as release a slate of home phone products under the RCA brand.

Lisa Castor, VP, Atlinks North America, said the company is "redefining" its strategy in the residential phone market, taking a keen look at integrating cellular telephones with home phones similar, but not identical, to the cellular-to-landline docking stations currently on the market.

Atlinks is also looking at home networking products and other innovative uses of home telephony that would carry both the GE and RCA brands, Castor said.

The move is aimed to stave off the slow but steady decline in the home phone market. According to Castor, although some of Atlinks' "big accounts" actually enjoyed growth in the category so far this year, it is expected to "decline rapidly" over the next few years thanks to market saturation and the increasing expansion of cellular telephones.

"Our move is a key part of Thomson's overall transformation strategy," Castor said.

The company, which is the volume leader in 900MHz cordless phones, will maintain its commitment to cordless phones despite the softness of the market, Castor said. The company recently starting shipping its first 5.8GHz digital phone (the 25830GE3) and plans to offer multi-handset cordless phones as well, Castor said.

Part of the Thomson/Atlinks transformation will involve the RCA brand. Castor indicated that Atlinks plans to introduce a lineup of RCA-branded residential home phone products, including 5.8GHz cordless phones "soon." The distribution, pricing, design and marketing strategy for the RCA products "will speak to a new direction" at Atlinks, Castor said. She added that the company is targeting CES 2004 as the forum for the RCA introductions.

Atlinks was founded in January 2000 as a joint venture between Thomson and European telecommunications company Alcatel. In February of this year, Thomson bought out Alcatel and assumed a 100 percent stake in Atlinks.

Alcatel employees who worked at Atlinks in Europe will remain part of the Atlinks team, giving Thomson continued access to the European market with the Alcatel brand, Castor said.

Atlinks employs roughly 76 people in the U.S. All of Atlinks' U.S. employees were offered the recently announced buyout package as part of Thomson's cost-cutting initiative. The buyout is set to expire Oct. 3 at which time Thomson will consider layoffs if internal targets of $25-$30 million in cuts have not been met.