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Philips Deploys Upmarket TV Strategy

BRUGES, BELGIUM -With the deliveries of its first flat widescreen HDTV direct-view monitors for the U.S. market, Philips Consumer Electronics hopes to expand its push into more profitable and prestigious “up-market” electronics.

The manufacturer brought a group of journalists to its television assembly factory, here, last month, to underscore the latest developments in these efforts and to highlight its recently launched line of flat-faced direct-view products for the U.S. market. The company’s business creation unit based at the facility is charged with global product planning and strategy for the high-end (or upmarket) direct-view TV segment.

In the United States, Philips is represented in this market niche by three so-called “Real Flat” widescreen direct-view models, including the 34PW9846 34W-inch 16:9 model that will be shipping to dealers soon. The piece includes a piano-black enamel cabinet, matching stand and Pronto touch-screen universal remote.

The HDTV monitor will present digital broadcasts in both 480p and 1080i native-scan formats and will carry a $4,999.95 suggested retail. Philips will direct distribution of the product toward specialty electronics dealers with value-added sales floors.

The other two U.S. models originating here began shipping several weeks ago and include the 34PW9815 ($3,499.95), a widescreen model with silver cabinet, and a 30W-inch widescreen model ($2,499.95) with silver cabinet.

According to Philips’ Wytze Werkhoven, the company will use picture quality and value to help capture a leadership position in the global digital television market. Philips, he said, is currently third-ranked in the United States, and first in Europe and Latin America.

The Bruges plant is roughly split between a massive TV assembly area and a printed circuit board assembly area. The operation is used to initiate production of new upmarket TV models. As volume increases, manufacturing is typically shifted to other facilities closer to the local market.

Widescreen sets made in Bruges for the U.S. market today will eventually be moved to Juarez, Mexico, which is now used for mainstream analog products.

Currently, Bruges produces 380,000 direct-view models per year, and 3 percent of those are earmarked for the United States. Nearly 96 percent of that production is widescreen product.

During his presentation, global product manager Danny Tack said Philips Real Flat tubes (34W-inch models are currently sourced from Matsushita) employ a completely flat design that uses 20 percent less glass than competitive flat-screen tubes. Among other things, this makes Philips’ sets lighter than competitive models.

Key features in the sets include Digital Natural Motion, which eliminates blurring and jitter in motion sequences, and Gun Pitch Modulation, which modulates the distance between three electron beams as they are scanned on the screen for enhanced sharpness across the screen.

Also assembled in Bruges are Philips plasma-display panels. An estimated 10,000 42W-inch plasma TVs will come out of the facility this year. Fujitsu produces the glass panels for Philips PDPs. Plasma production will be expanded to include 32W-inch models in September 2001 and a larger model in 2002, executives said.