Philips today has gracefully bowed out of the audio and video business by selling off the part of the company that deals with TV and audio tech to Japanese company Funai Electric in order to focus on its home appliance and healthcare products.
This ends a long reign of the Dutch company being a big name in the home entertainment business, as Japan’s Funai Electric will now own all of Philip’s work for a cool sum of £130m.
This is after Philips reported a €355m loss for the last three months of 2012, but unlike other companies that have been relying on the Xmas sales figures, Philips has acted fast to try and secure the future of the company. The company has long been losing money via its TV division which it transferred to a joint venture agreement with Hong Kong company TPV in March 2012.
With the sale of the audio and visual section of the business Philips now states that it will focus more on homeware and bathroom electronics such as shavers, toasters, coffee makers and lightbulbs.
“With consumers going online for music, films and games rather than buying CDs and DVDs, Philips decided to get out of home entertainment even though it was profitable last year,” Philips chief executive Frans van Houten told Reuters.
This isn’t a quick move either as Philips won’t be dropping production on audio and visual products immediately, with the audio side of its business changing over to Funai at the end of the year but the video side not passing over until 2017.
It’s a sad day for a company which was considered a big name brand in the 90’s but it’s good to see them moving with the times and sticking to an area that they can compete in.