Philips Propels Innovation to Center Stage at the 2007 Consumer Electronics Show.

LAS VEGAS -- A trendsetter in the development of innovative consumer technologies, Philips today announced a new range of products that will elevate consumers' entertainment experiences with unparalleled levels of design, quality and freedom of content. Showcased at the 2007 Consumer Electronics Show (CES), Philips' fresh lineup - which ranges from FlatTV[TM]s and unconventional sound systems to life-like gaming experiences - delivers relevant innovation into the hands and homes of consumers. Technology exists to help make consumers' lives easier and more productive. Philips believes in simplicity and is committed to delivering products and solutions that are easy to experience, designed around consumers and advanced.

"The 2007 Consumer Electronics Show provides us with an excellent opportunity to showcase a broad range of entertainment innovations that are pertinent to today's consumer," said Stewart Muller, president of Philips Consumer Electronics, North America. "Our newest products emphasize a deeper entertainment experience, free consumers from the existing constraints of technology and are backed by well-established partnerships to deliver the most dynamic solutions on the market. We ensure that what we bring to the consumer brings simplicity to their everyday life."

Philips' innovation in consumer experiential research enables it to discover, open and create new consumer-focused and relevant product categories. The company places an emphasis on the lifestyle of the consumer with a focus on technology to simplify and enhance day-to-day experiences. Watching a movie, making a long-distance call or playing a video game all take on a new approach with smart, sophisticated designs and intuitive operation that delivers the ultimate flexibility.

Total Immersion

Ten years ago, Philips publicly unveiled the world's first Plasma FlatTV. Since then, Philips has reinvented the FlatTV category with its unique Ambilight[TM] technology. In fact, last November Philips celebrated an exciting milestone having produced its' one millionth Ambilight FlatTV at the manufacturing and design center in Bruges, Belgium. The new line up of Ambilight FlatTVs includes sets that boast 1080p resolution and incorporate Philips' latest picture quality enhancements through its Perfect Pixel HD Engine[TM]. Utilizing this technology, each pixel of the incoming picture is enhanced to better match the surrounding pixels, resulting in a more natural picture. Artifacts and noise in all sources from multimedia to standard TV to highly-compressed high-definition (HD) are detected and reduced ensuring, that the picture is clean and razor sharp.

The Ambilight effect is now created by an innovative LED light source to generate more saturated colors, consume less power and provide a more compact design. This year, Philips has expanded the Ambilight line to include a 32-inch, 47-inch and the company's first 52-inch LCD FlatTV.

Ambience creates a superior dimension in the home theater experience. Philips adds another dimension to the ambient concept with Ambisound[TM] - a wall-mountable, integrated home theater system with an elegant and functional design. The perfect complement for a FlatTV display on a wall, Ambisound immerses the listener in an incredible sound experience.

The HTS8100 system envelops the listener with full, multi-channel surround sound from just one bar of speakers and a single subwoofer. It delivers a deep, rich sound while reducing the clutter in a home theater environment.

An evolution of Philips' multi-year research into ambient intelligence, amBX[TM] heightens the senses of sound, sight and touch in a PC game. The sensory enhancements produce a range of external effects while playing an encoded game. Stop playing the game, start living the game with these cutting-edge peripherals. The arrival of amBX not only enhances immersion for gamers, but unleashes a venue of creativity for designers. Game developers can now add new layers to the sensory experience beyond dynamic visuals. Several developers have already launched amBX-enabled games. New releases and previously issued games are expected to join this growing catalog.

Liberating content

Guided by the vision of ultimate personalization and unleashing content, portability has become a critical component in Philips' strategy. The company's portfolio of products continues to take the lead in providing people access to their entertainment and information whether at home or on the move.

Philips' new portable DVD line boasts versatility and mobility in one simple package. Each device can play a broad range of video-based media and features a memory card reader, which also can display digital photos. One new line even supports video through iPod[TM] docking, allowing users to play and view entertainment virtually anywhere and accessing CDs, DVDs plus music and videos stored on iPods.

With Philips' new 7-inch and 9-inch PhotoFrame[TM] line, consumers can free digital memories from their computer - where precious moments are stored but rarely seen - and share them with family and friends. New to the range this year is the advanced Smart Album[TM] software. This exclusive system helps users manage albums and set up, adjust and add transition effects to slideshows.

A survey commissioned by Philips revealed that Americans frequently enjoy music all around the home, and in increasingly personal ways. Nearly one-third of all respondents revealed that - thanks to multi-room audio devices - they enjoy listening in the locations they choose. Roughly 45 percent of American home listeners want to enjoy music in the living room, but are just as likely to listen in the bedroom, kitchen or even the bathroom.

Philips has addressed the growing interest for multi-room music enjoyment with its Streamium[TM] Wireless Music System. Easy to operate, the Philips Wireless Music Center freely and intuitively stores, manages and shares digital music with Wireless Music Stations that can be set up around the house. These music centers convert audio CDs into MP3 music files and store these on an 80 GB 1hard disk (up to 1550 CDs of music) to stream music around the home. The Wireless Music Center allows consumers to listen to the same songs in every room, a different selection for each room or enjoy any combination in between.

Effective Collaboration

Philips continues to align with partners for explosive potential and growth in the coming years. According to a new eMarketer report, the number of households using VoIP for phone calls will climb from 5.2 million this year to 32.6 million in the next three years. Philips' latest Skype VoIP phones operate on Digitally Enhanced Cordless Telephones (DECT[TM]) technology. DECT enhances the sound and security available in a cordless phone to create crystal-clear clarity. By teaming up with Skype, Philips offers consumers feature-rich, user-friendly cordless phones for the home or office.

Philips aims to be a top global player in the audio-visual, PC and mobility accessory market. Supporting this position is the recent acquisition of Power Sentry - the dominant player in the North American surge protection market with sales of approximately $50 million. Philips' acquired family of surge protectors (Expandable, PowerSquid([R]) and Theatre Director[TM]) provides protection and organization for today's computer or home theater applications with simple, safe solutions.

The Blu-ray Disc (BD) - today's most sophisticated home entertainment storage format - has the technological advantage to be the industry leader with the support of more than 170 companies, including seven of the eight major Hollywood studios. For Philips, the Blu-ray Disc embodies the future for playing movies in HD, storing personal content and recording and playing back HDTV programs. Philips has supported BD as a standard from the very start and has launched a Blu-ray disk player, a 'Triple Writer' PCWriter[TM] and 25 GB Blu-ray discs.

In the near future, consumers can look for Philips' Blu-ray 50 GB discs. For the ultimate HD experience, Philips' Blu-ray Disc player is loaded with features that provide the most stunning pictures available, including an HDMI output that supports the latest 1080p resolution and a component video output that provides brilliant imagery. Rich surround sound is heightened with multi-channel HD audio decoding and digital audio optical outputs. Blu-ray also upscales traditional DVDs to enhance the picture clarity.

About Royal Philips Electronics

Royal Philips Electronics of the Netherlands (NYSE: PHG)(AEX: PHI) is a global leader in healthcare, lifestyle and technology, delivering products, services and solutions through the brand promise of "sense and simplicity". Headquartered in the Netherlands, Philips employs approximately 126,000 employees in more than 60 countries worldwide. With sales of $37.7 billion (EUR 30.4 billion) in 2005, the company is a market leader in medical diagnostic imaging and patient monitoring systems, energy efficient lighting solutions, personal care and home appliances, as well as consumer electronics. News from Philips is located at www.philips.com/newscenter.

FlatTV is a trademark of Koninklijke Philips Electronics N.V.
Ambilight is a trademark of Koninklijke Philips Electronics N.V.
Ambisound is a trademark of Koninklijke Philips Electronics N.V.
amBX is a trademark of Koninklijke Philips Electronics N.V.
DECT is a registered trademark of European Telecommunications
  Standards Institute (ETSI)
PhotoFrame is a trademark of Koninklijke Philips Electronics N.V.
PowerSquid is a registered trademark of Trident Design, LLC
Theatre Director is a trademark of Koninklijke Philips Electronics
  N.V.
TripleWriter is a trademark of Koninklijke Philips Electronics N.V.
iPod is a trademark of the Apple Corp.

1 Actual storage may be less. 1 GB = 1 billion bytes