ANTON PHILIPS Biography - Bussiness people and enterpreneurs

 
 

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ANTON PHILIPS

Anton Philips (1874 - 1951)                                                                                                   
In January 1895 young Anton Philips travelled to Eindhoven, a small town in the southern                                     
part of The Netherlands. His brother Gerard had a little factory there for the production of                                 
electric light bulbs and needed a sales-assistant. He was twenty and expected to spend half a                                 
year in Eindhoven, at the most. Things turned out differently. As a trade school student he                                   
had been a failure but he did like the practice of selling and buying. So he decided to stay.                                 
Anton was gifted with natural charm, a negotiating talent, energy and confidence. He                                         
had courage: In 1898, just twenty-four years old and hardly speaking any foreign languages,                                   
he took a train to Russia and returned with huge orders. He became a formidable salesman:                                     
in 1912, he started a joint venture in the USA and in a couple of years reached 10 percent of                                 
General Electric's sales numbers, making this giant fear that he would eventually threaten its                               
dominant market position. He had an excellent nose for business opportunities. When World                                     
War One broke out in 1914, the Russians wouldn't buy German lamps anymore. Anton                                             
immediately sent one of his salesmen to St. Petersburg. His speed of action was unparalleled.                                 
When the war ended in November 1918 and British forces re-captured Brussels, he was right                                     
behind them to start Philips' first foreign sales subsidiary.                                                                 
It took the Philips Incandescent Light Works (NV Philips' Gloeilampenfabrieken), officially                                   
founded in 1891, four decades to reach the top of the lighting industry. In the first two                                     
decades the company became Europe's third largest producer of light bulbs, with a turnover                                   
of some 33 million in 1911 (3.7 million Dutch guilders, converted to Euros of 2003). But                                   
its technological basis was relatively weak. Philips was a one-product-company. Its major                                     
competitors - General Electric in the USA, AEG and Siemens in Germany - were large                                           
electro-technical conglomerates, which could afford well-staffed laboratories and shared                                     
patents. Gerard had to do his research by himself, with the help of one or two assistants. In                                 
1911, the GE-laboratory came with a major innovation: the 'drawn' tungsten wire filament.                                     
Anton quickly travelled to America to search for the details of this innovation and succeeded                                 
in filching them from GE's business relations, using every trick in his box. He came home                                     
with enough information and machinery to help Gerard make his own 'drawn' tungsten                                           
filaments. However, in 1913 GE, using advanced physics, produced an even more superior                                       
novelty: a gas-filled lamp with a spiral filament, which used much less energy. This was                                     
beyond Gerard's technological limits and Philips was not able to produce these so-called                                     
'half-watt' lamps without GE-licenses.                                                                                       
Up to that point, the impressive business performance of the Philips-brothers had                                             
been based almost entirely on their combined development and sales capabilities. Gerard, the                                 
engineer, was a master at quickly converting new technology - regardless of whether he had                                   
developed, 'stolen' or licensed it - into marketable lamps, and manufacturing these at a large                               
scale and at low costs. In 1911/1912 he prepared the market introduction of the new lamps                                     
with 'drawn' tungsten filaments in just a few months' time. Anton's subsequent commercial                                     
approach was equally impressive. He immediately started selling the new lamps in Europe                                       
and the United States, essentially playing va banque. General Electric, tricked out of the                                   
'drawn' tungsten technology by the brothers, would surely react to this provocation and so                                   
would the mighty German combination of the Patentgemeinschaft, who owned the GE-patents in Europe.                           
Together, the Germans and the Americans might have squeezed the Dutch. Fortunately their reactions were not in unison.       
The Patentgemeinschaft launched a legal attack and forced Philips to accept a licensing                                       
agreement which curtailed its European sales to about half the production capacity. GE                                       
however, fearing it might be accused of monopolistic behaviour and violation of the antitrust                                 
laws, refrained from such an aggressive approach in the USA and aimed at negotiations. As                                     
soon as Anton sensed GE's leniency, he increased his cross-Atlantic exports, compensating                                     
for the sales limitations in Europe. Sometimes betting on two horses pays off.