The TV and mobile business rent - Will the Philips be the brand lessor

Changes are taken place in the consumer electronics market

. Now the TV mobile phones are becoming very hot, but the TV is still a very necessary household equipment.The centennial corporation Royal Philips Electronics has signed a brand licensing agreement intention letter with the TPV Technology. TPV will be responsible for the 5-year purchasing, distribution, marketing and selling of Philips TV on China mainland from the fourth quarter of 2010. And Philips will charge a certain amount of royalty.

It's not the first time for it to sell the brand rights. Before, Philips also signed the TV brand license agreement of North America and Mexico with Funai Electronic Joint-stock Company. In 2005, TPV also purchased the world Philips Display Departments. The Shenzhen SED Electronics Group also gained the brand rights of mobile business in Mainland China.

Some people think that the rent of the TV brand may cause two problems. If its small household appliances will also be sold, it may cause the unsteadiness of the small appliance distributers. The frequent brand renting in the world consumer electronics field may cause the mistrust and resistance of consumers group. The Philips health care and lighting business may be impacted.

At present, the two sides concerned refuse to reveal the five-year brand rent cost. The purchasing of the Philips display business only cost 15.40 million dollars at that time. As the occupancy and consuming ability is low in the color TV market, the closing cost should not be too high.

Some consumers said,"I like the long standby time mobile phone at that time. But I don't buy it any more as it's rented by SED. It's unecessary to spend so much money for a brand." "I don't like the color TV before, and there is less possibility to buy it as it has been purchased by TPV. But the shaver of the brand is nice."

In current years, the European electronics enterprises gain the living space in China in manner of brand renting. The Electrolux rented its airconditioner brand in mainland out to Gome Electrical Appliances and rented the fridge business out to Meiling. And Whirlpool passed the airconditioner business to Suning and washing machine to Hisense Kelon.

As to the renting of brand right to TPV, Philips represented that it's in accordance with its worldwide TV strategy - to optimize the region power in different commercial modes. But there is a fact that Philips is in a long term transition process as it has experienced the great loss. It starts to decrease the consumer electronics business which is filled with firece competition and turns to the medical health and the lightling business. It shows the declining tendency in the traditional consumer electronics business.

At present, the mobile phone and TV business is running well in the brand renting mode on the Chinese market. But audio, Blu-ray disc player and computer accessories businesses still don't gain further development. And it still maintains nice market scale of the shaver, juice extractor and other small appliances.

There is discussion that there is possibility that it will rent out the right of appliances if it has enlarged the investment in other fields. However, it is not confimred by the Philips.

The TV and mobile business rent - Will the Philips be the brand lessor

By: Tracy

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