The negotiations went smoothly. It could be said that Philips' representative, Mr. Thomas, was shocked by Wind and Rain's "power" and made some concessions.
In terms of branding, Philips was stronger than Wind and Rain. In terms of expertise, Philips was also stronger than Wind & Rain Electronics and Wind and Rain Electronics combined.
But Feng Yu had made it very clear that if they were to cooperate with Wind and Rain, they would be able to develop many world-changing products. The current VCD, Super VCD, DVD and CD-ROM drives in the future, and even cleaning robots, microwave ovens, etc., would bring in high profits for Philips.
It was these profits that made Thomas and Philips agree to Feng Yu's conditions. They will work together to set the industry standards and promote the popularization of VCD, DVD and other new home appliances.
Wind & Rain Electronics and Wind and Rain Electronics will share their technologies with Philips for free. Philips will also share their CD-ROM technologies, TV technologies, LCD technologies, optical communication technologies, etc. with Wind & Rain Electronics and Wind and Rain Electronics. Both parties will be exchanging technologies.
Whichever company owns the patents will continue to be owned by that company, but the other party will be able to use the patents for free. This company will also continue to own the patents for the related technologies.
Feng Yu had thought it through before he decided to exchange the VCD patents to Philips. Feng Yu had been thinking why the VCD development in this life was not as fast as his previous life. There was only one reason. Wind and Rain VCD and Aiwa VCD were the only two brands in the market, and both of them belonged to him.
No matter if it was the sales channels or marketing channels, they could not be compared to the number of companies in Feng Yu's previous life. In Feng Yu's previous life, most of the Japanese companies owned the VCD patents. They were the first to discover that Wan Yan had not registered the patents and had registered the patents first.
In the end, all the Hua Xia VCD brands had to pay the patent fees to them. They also relied on this money to continue to develop better technologies and lead the industry.
In this life, the patent was in the hands of Feng Yu, and the Japanese companies had no way of getting involved. The development of VCD players was not as fast as Feng Yu's previous life. But history is the same as Feng Yu's previous life. All the companies that are interested in DVD want to replace it.
DVD can indeed replace VCD. Whether it is in terms of technology or user experience, it is far superior to VCD. Unfortunately, although they have accelerated, the latest DVD technology is still developed by Wind & Rain Electronics.
But Feng Yu knew that if Sony and the other companies increased their R&D investments, Wind & Rain Electronics and Aiwa would not be able to maintain their lead.
It was just like the video game industry. Nintendo had left Sony behind, but Sony used two years to develop the PlayStation console. In the end, they snatched the majority of the market share!
Although AIWA had suppressed Sony in the Walkman market, it was because Sony's current focus was on the movie studio. That was their biggest investment in the 1990s, and it was also an overseas investment.
Once the movie studio starts to make profits, Sony will have the time and energy to suppress AIWA. But Feng Yu is not worried about this. When Columbia Pictures starts making profits, Walkman will be retired from the stage of history. At that time, if Sony wants to snatch Walkman, they will let him have it.
But now, Sony and Toshiba had joined forces to set the industry standard for DVD players. They realized that DVD players are better than VCD players and will replace the traditional cassette players. Also, this is what Columbia Pictures needs. With this, they can record the rights of their movies into CDs and sell them again.
Columbia owns a large number of movie copyrights. If they can introduce a good CD-ROM and VCR, it will become a new source of profit for Columbia Pictures. It will save the company in disguise.
That's why Sony will be investing a lot in the DVD industry. Feng Yu knew that if he insisted on doing this, he could still continue to invest in Aiwa and Wind and Rain Electronics. But it was not worth it.
But if he works with Philips, he will get many benefits. Especially in this agreement, Feng Yu can let Philips manufacture a batch of products for him.
AIWA only has a factory in Europe in London, and it is mainly producing Walkman. That factory needs to cover the whole Western Europe market and cannot produce VCD players. AIWA's VCD players and Wind and Rain VCD players are all produced in Hua Xia's factory. It is the same for Hua Xia's VCD players and Wind and Rain VCD players.
Those video cassette player manufacturers had lowered their selling prices to compete with VCD players. Those manufacturers had joined forces and affected the marketing of VCD players in Europe and the US.
Feng Yu had to admit that those big companies had too much influence. They had made it hard for VCD players to market overseas. Although the profits were not bad, it was still far from what Feng Yu had imagined.
In Feng Yu's previous life, the VCD market was booming. The annual production value was astronomical. Now, this industry was monopolized by Feng Yu, and the production value was not increasing. How could Feng Yu not be worried?
But now, with the addition of Philips, the VCD industry will be able to grow faster with Philips' sales channels in Europe and America. Also, Thomas and Feng Yu had the same idea. They want to introduce the Super VCD player and not the old VCD players. This way, they can widen the gap between VCD players and the traditional video cassette players. It will be easier for them to overtake them!
Also, Feng Yu had only authorized Philips to use the VCD technology. With the new technologies, he could authorize more companies to use the VCD technology. Everyone will work together to develop the VCD market, but the biggest market share will still be Wind & Rain Electronics.
But the benefits of setting the industry standards will be in the future, and the benefits of producing the Super VCD players will be immediate. Thomas also represented Philips to accept Feng Yu's request to manufacture the VCD players. This will lower the cost of Wind and Rain VCD, Aiwa VCD and Aiwa VCD players. This will reduce the time needed to introduce the new products.
Feng Yu was mainly introducing Wind and Rain VCD players and Aiwa VCD players in China. In the overseas markets, he will be introducing Wind and Rain VCD players and Aiwa VCD players. Aiwa VCD players are only targeting the Southeast Asia market or Hua Xia market.
Of course, Philips will not suffer any losses. Not to mention the Super VCD technology, the profits from the DVD and other electronic products will bring about great changes to Philips in the future.
With more profits, Philips can also increase their research on medical products. This way, Philips can overtake Siemens!
When Philips knew that Feng Yu had Aiwa Pagers, Philips felt that they can cooperate in the telecommunication industry. For example, they can develop mobile phones together. Mobile phones will replace pagers in the future. This is a fact that everyone knows.
But Philips felt that this will take more than 10 years. But Feng Yu felt that within 3 years, pagers will become a sunset industry and will decline rapidly. Within 5 years, mobile phones will replace pagers and become the leader of the telecommunication industry!
Thomas felt that Feng Yu's suggestion was too radical. He made a bet with Feng Yu. If the pagers will start to decline within 3 years, Thomas will be able to see the trend of mobile phones replacing pagers within 5 years. Thomas will agree to one condition from Feng Yu!
After the agreement was signed, Thomas immediately returned to the Netherlands. Time was tight as the DVD industry standards competition will start soon!
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