After several years of mounting financial losses and the apparent inability of the management to find a way to make its lighting division profitable as the market shifts to newer technologies, the announcement to pull out of yet another of Philips' core businesses has been made.

Last week the other two remaining business units, Healthcare and Consumer Appliances have been merged, and Lighting has been split off as a separate legal entity to facilitate its eventual change of ownership. It's not yet known whether Philips will keep some shareholding in the business as Siemens did with Osram, or simply sell it all off to new owners.

The move follows a similar announcement of a few weeks ago to quit LED semiconductor operations by selling of its Lumileds division, and also the Philips automotive lighting business. Now it seems that the rest of Philips lighting is also up for grabs.

It's really incredible to see how this once giant corporation has been dismantled and sold off in the past two decades. One by one its key divisions have been spun off, and now it seems it's time for the lighting division on which the whole company was founded. You have to wonder what will be left of Philips in another few years time, perhaps other than its still powerful brand which will undoubtedly continue to be licensed and used by whoever should take over.

http://luxreview.com/news/404/philips-pushing-lighting-business-out-the-door
http://luxreview.com/news/405/philips-and-lighting-a-long-goodbye
http://www.edisonreport.net/lighting-industry-news/philips-laas-lighting-standalone/
 

Such a shame.  Well not really.  Seems a lot like what Westinghouse when thru.. Hmmmmm... 

Holy crap! I definitely did NOT expect Philips to fall apart any time soon! I'm off to HD to buy a couple cases of "the good old" Philips F40/CWS lamps!

I see there's also speculation that GE may seek out a buyer for their lighting business now that they've agreed to sell off their appliance division to Electrolux.

Electrolux also acquired the rights to use the GE name on appliances for at least the next 40 years, so it doesn't look like the brand will vanish anytime soon.  I feel like this kind of brand licensing is rather misleading, especially when the brand name is also a former company name.  At least Electrolux is acquiring the actual GE products, technology, and workforce.

It's better than Westinghouse.  They even had the arrogance to create a false heritage.  It's truthful in the sense that it was all "Westinghouse," but they present themselves as being the same company that made those innovations of the past.  They are not.  The current Westinghouse licensees only purchased the brand.  They did not acquire any of the patents, facilities, or employees of the former Westinghouse Electric Corporation.  In addition, they are not a single company today like their history page suggests, but rather a collection of independent companies that have nothing to do with each other besides a licensing agreement.  The only division that can trace it's roots to the former Westinghouse is the nuclear power division, now owned by Toshiba.

Hopefully if GE and Philips spin off lighting, they'll either remain independent or go reputable buyers.  It'd be a shame to see quality deteriorate or manufacturing outsourced.  Enough of that has happened already.

That "Westinghouse" page and all of its false information disgust me.

Holy crap!   I never would've expected the biggest force behind the LED revolution to write off their lighting division altogether! I too wonder what's gonna be left of them... All I know them for are lighting, A/V equipment, and their Norelco personal care stuffs.

I've got some "Westinghouse" incandescent closet lights I need to upload here some day. They even came with "Westinghouse" heavy duty batteries whose metal casings are so thin, you can squeeze the battery flat between your fingers!

WOAH! Those batteries must be super cheesy! You should show us.

Regarding the "brand prostitution" (how else call that), I see GE being the most "active", at least in Europe...

But Philips is quite strange company, I have sometimes the feeling, they get "tunelled" by their management, already for quite long time.
Otherwise how to eexplain even the few cases I know:
- Their electron microscope division was "loosing money", but once it was sold as a FEI company, it become quite profitable Even when that mean loosing the finantial backup form the mother company.
- Very similar to the Semiconductor division as NXP (but that is in worse health now, as far as I know)
- Even the passive electronic component division sold way earllier (I don't know the name anymore), it is one of the major passive component supplier and it is quite healthy.

How that come, when all these were lossy as part of Philips, but become profitable after they split? When the business theory says they would have worse position to survive the market fluctuations...

It is strange that Philips reached to this state, if they were actually the once that rised the idea to ask governments around the world to ban incandescent lamps and the rest traditional lighting technologies, in the name of the environment, in order to make profits.

Id have a funny feeling when philips is breaking apart
Cause here in USA they got rid of the 34 watt fluorescent line, and only  putting gaurds on one
End of the tubes sure sign  philip was struggling
To keep up. Closeing the bath hid plant
 Id think philip shot them self in the foot
   When they impose on the american goverment
 To phase out certain lamps, causing lamp prices
To go silly even when the new energy saving
Lamps took it  place.  Now i have to rely on
Lamps from second hand shops.
 

Your analysis is very good Medved.  It makes you start to doubt the competence of the heads of some of the world's giant corporations which have exceeded a certain age.  Often a company grows tremendously when it is run by its original founders, who are typically people who developed the original technology on which their companies were founded and truly understand the products and their applications.  They spend their lives fighting to make their baby successful, and have the personal drive and motivation to win in their chosen market.  Then as those people become older and retire, the second generation takes over.  Sometimes they may be from the original family or by chance and good recruitment have a similar personal love for what they do, but invariably there is some dilution of the skills and experience needed to run the business.  By the third generation, it is typically people from completely different backgrounds that take over - frequently from legal or financial backgrounds, with very little understanding of the products that actually fund their salaries.  As such, instead of spending whole lifetimes with the same company these people tend to change jobs every year or two, always shifting on to something that will grow their personal position.  Then things become dangerous and badly-informed decisions start to happen, which often focus on the short-term benefits rather than working on the expensive and difficult tasks that lead to long-term growth and stability - but which they know will only benefit their successors rather than themselves.  In a short space of time the founding principles on which the company was established begin to become less relevant, and this is not always in the best interests of the company.  

The former R&D Director of Sylvania has written an outstanding paper on his dim view of the management of big corporations, which you can read at: http://scitation.aip.org/content/aip/magazine/physicstoday/article/54/2/10.1063/1.1359708

He doesn't go so far as to explain why small companies who get the chance to snap up elements of giant corporations manage to turn loss-making business around and put them back on track, but it could be as simple as that they are newer enterprises, still being run by 1st or 2nd generation management who know their business inside out and make more experienced decisions for the good of that company.  I can believe that this is the case for the examples that you give.  The same also applies to other companies like Dr. Fischer, Nordeon, Isolde etc who have taken over some of the Philips lamp operations in recent years which would otherwise have been closed and turned them around to become powerful and profitable again.

I can therefore only conclude that it is not so much the size and historical importance of a company that determines its long-term success, but having what Waymouth calls a 1st or 2nd generation management team that is truly devoted to the long-term good of their business is also of crucial importance.  That ended about 20 years ago at Philips, and 20 years ago the selling-off of the key business units started, one by one, which has brought the company to its present position.  No doubt scores of managers have profited very nicely on a personal level from the short-term financial fortunes that they brought to their company, but bit by bit it takes its toll on the long-term health of the entire organisation.

Practically all Philips, Westinghouse, Osram, GE etc. are already just brand stickers that importers pay for stamp in their products, not only lighting, a lot of things really. 

For me, I would probably grieve the death of CDO TT and CDO ET lamps.