Connected Consumers: Connected China: Connected Planet

Piet Coeleweij, Senior VP and General Manager, Philips Consumer Electronics, China

From our humble roots to a global leader, today Philips is one of the largest global electronics companies, with over 160,000 employees in over 60 countries. Here in China we're one of the largest multi-nationals employing more than 20,000 employees. This gives us a unique insight into how people experience the realities of the digital age.

Our vision for the digital age is called the "Connected Planet", and the strategy is based on a vision to deliver the freedom to experience digital content from any location, regardless of the source. How then do we ensure that this is built into future innovation?

Drawing on our heritage, our vision drives technological innovations that are designed to improve our customers' quality of life. Rather than just one niche, Philips excels at producing innovative products in three interlocking domains: healthcare, lifestyle and technology. Easy-to-use interfaces are as much an issue for CT scanners as they are for operating the remote control for your television. Our mission is simple and it's our business' backbone: give the customer what she or he wants through products that are simple to use and enhance their quality of life.

In China as never before we see a market changing rapidly, poised to leap-frog traditional technologies. The Government is hugely supportive of the embrace of technology whether in infrastructure, talent development or encouraging the consumption of new goods and services. Already, the pace of change is moving fast. According to CNNIC's recent report, there are 103 million internet users (53 million using broadband) which represents an 18% year on year growth rate. The appetite for becoming connected consumers is never more apparent.

So what's holding us back? It's certainly not consumers. Too often our customers tell us that technology is a burden, rather than an enabler. Our challenge is to integrate technology into the modern lifestyle creating products that are smart on the inside, yet simple on the outside. This idea is embraced in our brand promise: Sense & Simplicity

In 2004, we commissioned research across the world that showed that 30% of home-networking products were returned because customers couldn't get them to work and 48% of people thinking of buying a digital camera didn't because they thought they were too complicated.

The inherent complexity of technology need not be a trap. Simplicity must be the face the consumer sees. Our experience and research suggests the public is, in fact, tired. Tired of not being able to record a program on TV (unless you have a teenager in the house!), tired of spending hours reading an instruction manual, tired of complexity for its own sakeĦ­

Sense & Simplicity embraces three pillars that are designed to inform and influence everything the company does - from business processes to application creation.

?Designed around you, so that activities are driven by insights into how the customer experiences the benefits of technology.

?Easy to experience, our belief that people should be able to enjoy the benefits of technology without hassle or frustration. Sophistication, yes. Difficult to use, no.

?Advanced, a product is only truly advanced when it improves the lives of people. It's not about technology for its own sake.

Having the foundation we then look at the elements that will shape the "Connected Planet" from a consumers point of view. Three core elements come together:

- the content itself
- the distribution of that content
- the platform on which we experience it.

Today, we use a variety of platforms, depending on the type of activity we are doing. For inter-personal communication, we tend to use the telephone (landline and mobile) and PC-based email. For information access, we use PC-based or TV-based text services. For pure sit-back and relax experiences, we turn on the TV, listen to music and playback favorite movies and recorded memories.

Convergence won't change the fact that certain experiences are still predominantly enjoyed on certain platforms. But it will mean that the same experiences can be made available on multiple platforms too. Just think of the news alerts on your mobiles, or the emails sent by PDA.

In-home networks, which are beginning to enter the mainstream, will play a crucial role in this. They will route content stored locally on devices such as personal video recorders, DVD players or PCs. They will also route content accessed remotely via broadcast networks or the Internet. This content will cross the network to get to wherever it is needed, and in the right format for the display device being used.

In this Connected Planet, people will have the freedom to enjoy their favourite digital content and access services or information where and when they want. They will be free of constraints in time and place. And they can use the type of device they prefer with no need to worry where the content or services are located.

The expectations for what digital technology should be able to achieve are high. In fact, the first ten years of the 21st century have been dubbed the "digital decade" by some - in anticipation of the positive effects that digital technology will have on our everyday lives.

In China the journey towards digitatization is mapped out in readiness for the Beijing Olympics. The Chinese Government has declared that in 2008 digital broadcast signals carrying Olympics programming will be made available to TV stations worldwide, and officials have predicted a timeline of digital broadcasting throughout China by 2010 and termination of analog broadcast by 2015. At the same period China will also provide commercial 3G services to more than 349 million subscribers . Digitization has already enhanced everyday pastimes as listening to music and watching TV. The arrival of broadband connections into the home has given us a wealth of content from which to choose.

Philips is committed to liberating people from the existing constraints of technology by building products that encourage them to explore a new, richer world. Giving people choices that enrich their home life - choices that are easy to analyze and, thus, select. Choice, perhaps, they didn't even know they had.

Drawing on our key strengths of technology and innovation, Philips has produced a series of products that are specifically designed around the customer, easy to use and advanced such as Philips award-winning Ambilight technology.

Applied in a number of Philips FlatTV LCD and plasma TV sets, Ambilight changes the viewing experience by producing ambient light to compliment the image onscreen by projecting background lighting from the rear of the TV set onto the wall behind the set.

Ambilight was developed following detailed consumer analysis into how people watch television at home. Consumer testing proved to be extremely positive with viewers reporting overwhelmingly that lighting around the TV set contributes to picture quality and, most importantly, an enhanced viewing experience.

And just think of a DVD recorder that you don't need your teenage son at home! A DVD recorder that's easy to operate and records your favorite programs; imagine recording any TV program on impulse at the touch of a button or pausing live TV when the phone rings - what a difference for the World Cup! The Philips DVDR-HDD demonstrates how traditionally strong technologies such as DVD can be combined into one easy-to-use package.

Choice is also apparent in our mobile phones; PHILIPS 968 enables consumers to shoot, and share video. It is a great multimedia phone with camcorder and 1.3 Megapixel still camera plus TV Link to view your A/V footage and photos. Thanks to the touch screen, consumers can tag photos with fun messages and easily enter SMSs with hand-writing recognition technology.

For the busy professional or fast-paced urbanite there's the Philips Xenium 9@9e, the latest flagship phone in the range. Sharing the extremely long battery life of its predecessors, this latest Xenium phone will appeal to people who will appreciate its reliability, design, record-breaking seven hours of talk time, and ability to provide up to four weeks of standby power together with multimedia functions such as the 1.3 Megal-pixel built-in camera.

During 2006 a variety of product lines will be introduced to bring the vision of the connected consumer that much closer, allowing us to interconnect all CE appliances in the home from wireless hubs, and an audio systems that allows multiple choices of music to played around the house from just one system.

And what can Government do to further support further innovation? The Chinese Government is very much behind the progress and opportunity presented by new technology. But there are of course challenges - how to produce quicker and clearer standards in line with global developments that allow content and technology to work seamlessly? How to create an overarching platform on which multiple ministries may align? Perhaps most importantly is the creativity and innovation that comes from creating win-win partnerships across Government, industry and consumers to ensure that the high expectations and anticipation are delivered in a way that most benefits the consumer living in the Connected Planet.

(October 12, 2005)

Copyright 2004 by All rights reserved.