Traffic warden on the information highway

THE MONDAY INTERVIEW; Richard de Lange; Philips UK's new chief has seen the future - and it's called 'infotainment'
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Richard de Lange has a driver to take him to work each day. But the new chief of Philips UK is firmly in the driving seat as the company motors down the information superhighway.

As for his eventual destination, Mr de Lange says much depends on future traffic conditions. And Philips will be a key player in determining just that.

"If you look at multimedia in the broad sense of the word, you see data, picture, video and sound coming together," Mr de Lange says. "The future is not about the highway but about the traffic on the highway."

For Philips, that traffic includes multimedia titles developed by the company itself, as well as the music and film properties released by PolyGram, which is 75 per cent owned by Philips. The PolyGram connection opens up a rich seam of popular cultural products, ranging from music by top recording artists to hit films such as Four Weddings and a Funeral.

With Philips' new CD-Rom interactive technology now available in shops, and with a growing list of multimedia titles on the market, the Dutch- based electronics giant is "well positioned", Mr de Lange maintains, to be a pre-eminent player in the evolving "infotainment" sector.

Putting the emphasis on product rather than on the means of transmission may seem odd, coming from a senior executive of a company that makes television sets, video recorders and electronic components used in home and business equipment.

But increasingly, conventional wisdom appears to be shifting in favour of those who own the "content" rather than control the "carriage".

Communications giants such as Viacom or News International seem far more interested in building a catalogue of popular titles than in controlling one or another of the "on-ramps" that will serve to deliver movies, music and information into homes and offices. Philips, not surprisingly, is hedging its bets. The company is spending serious money developing new technology for the delivery of multimedia products. The CDi format is the best known, even if it is selling less well than the company had hoped.

Philips is also working with Sony on a new standard for CD-Rom material, in competition with Toshiba and a host of leading computer companies that are sticking to a rival standard.

In the end, Mr de Lange does not believe that one format will win out. After all, he points out, we all use audio tapes and CDs, and watch TV as well as videos. The key, he believes, is to ensure that consumers are able to buy hardware without fear of having their equipment become quickly obsolete. He says it is a matter of corporate responsiblity. "With the new platforms [such as CDi] you can still use the old formats."

A focus on the hardware part of the equation is logical for Philips, which made its mark developing TV and VCR technology, the audio cassette, and increasingly sophisticated versions of one of the oldest "modern" products of all - the lightbulb.

Equally, there is logic in the appointment of Mr de Lange, formerly the head of the European lighting division, to his new post at Philips UK.

"My main assignment with Philips Lighting was to ensure that the business was strong and healthy," says the carefully spoken, indeed dour, Mr de Lange. "We wanted to turn it from a loose federation into a much more structured, integrated European marketing and sales operation."

That approach cut across geographical boundaries, allowing Mr de Lange to ignore frontiers in the quest for efficiency. At the helm of Philips UK, the task is distinctly border-bound, however, presenting Mr de Lange with a slightly different challenge.

Philips UK employs 10,000 people at 15 manufacturing plants and makes products ranging from TV tubes and magnets to electronic components such as computer chips.

It also makes 25 million compact discs a year, along with 250 million light bulbs, and is a key part of Philips' world-wide research and development activities. The UK operations are increasingly viewed as a showcase within Philips globally. But that was not always the case.

"For a very long time, the view of the UK was not very positive," Mr de Lange says. "But the depth and width of improvement and turnaround here in the UK over the past three years has been striking. When I make my rounds now I get confirmation of what I had already heard from my colleagues. Most of the operations today are among the best in their class world-wide."

The company's more positive view of the UK operations is made plain in the pounds 150m Philips spent on capital investments last year. "If you had asked two or three years ago if we should spend this kind of money in the UK, few would have predicted it," he says.

"There is now a strong conviction that you have to face the world: you can't find excuses any more. You have to look at your cost base, services, your speed in reacting to shifting technology and markets."

The turnaround in the UK mirrored changes at Philips' head office. Poor results in the early 1990s threatened to tarnish the company's reputation and prodded Jan Timmer, the company's chief executive, into action. Under his leadership, the Centurion plan was launched, leading to redundancies and a refocusing of the corporation.

Mr de Lange is a fervent supporter of the new approach, although he keeps his enthusiasm in check - at least with the press. He learnt to be circumspect following a difficult few days in the Netherlands when he was in charge of labour negotiations. Philips' decision to institute Saturday shifts caused a stir; Mr de Lange, joking with a journalist, said the company might have to have Sunday shifts too - a remark reported on the front page of a leading Dutch daily the next morning.

Off the record, Mr de Lange is less reserved, and reveals - eventually - a sense of humour. But there is no doubt about his commitment to work. He admits to few hobbies, other than listening to classical music and a bit of bicycle riding. He is delighted to be in London, however, where, he says, "you have the best of everything there is, in theatre, in music and so on".

The only drawback? The traffic, of course, even for a man with a driver and car to ply the long distance between a Croydon office and central London. At least he is in better control of traffic on the information superhighway.