Philips RFID Chips Certified for EPC Gen2 Standard; Deployment of Gen2 Standard Enables Global Interoperability and Performance Enhancements in Supply Chain Applications.

EINDHOVEN, The Netherlands -- Royal Philips Electronics (NYSE:PHG)(AEX:PHI) is the first major supplier to have its RFID chips certified by EPCGlobal as Gen2 compliant, according to the Metlab Conformance Test. The Philips UCODE EPC Gen 2 chips are available now. EPC Gen 2 is widely supported by end-users and manufacturers within the RFID industry and will facilitate the widespread deployment of RFID technology - especially in logistic applications and the retail supply chain. With broad deployment of the EPC standard, different RFID labels and readers are fully interoperable in different global regulatory environments. As a result, suppliers and manufacturers throughout the supply chain can realize significant improvements in performance, cost and reliability as well as easy migration to future EPC classes.

Retailers such as METRO Group have already committed to implementing Gen 2 RFID technology in their supply chain management systems. "RFID has already increased transparency of our processes and traceability of objects within our supply chain. Philips UCODE EPC G2 compliance will enable the METRO Group to enlarge our existing RFID rollout," said Dr. Gerd Wolfram, Managing Director of MGI METRO Group Information Technology GmbH. "Retailers and suppliers want - and need - a single, globally-accepted standard that will deliver cost-effectiveness and full interoperability which is supported by large technology providers such as Philips."

"We want to ensure that adopters of RFID achieve a seamless migration from the previous infrastructure while capitalizing on the global interoperability and increased performance that Gen 2 offers," said Christophe Duverne, Vice President, Marketing and Sales, Identification, Philips Semiconductors. "Philips and its Gen 2 RFID solutions are answering the demand of the fast moving consumer goods (FMCG), pharmaceutical, apparel and many other industries. Compliance was the final milestone we needed to pass prior to starting volume production of our Gen2 chips, and we're pleased to be the first major supplier to deliver Gen2 chips to our customers."

Philips has been the leading provider of RFID ICs for over twenty years, selling more than one billion RFID chips to-date worldwide. Philips is an advocate of open standards and is working closely with industry partners such as EPCglobal to stimulate market adoption. Philips has driven a Gen2 Task Force program together with ASK, Avery Dennison, Checkpoint Systems, Deister, Feig, Omron, Rafsec, SAMsys, Symbol Technologies, Thingmagic and X-ident technology to develop an end-to-end Gen2 RFID solution. Wide availability of EPC Gen 2 silicon will greatly benefit the RFID tag value chain as it prepares for high volume orders in 2006. Suppliers, multinational retailers and manufacturers worldwide have been mandated to meet the Gen 2 compliance and therefore a significant uptake is expected.

Philips UCODE EPC G2 chips feature a one-time programmable memory for the 96-bit EPC, covers all mandatory commands and provides a selection of optional commands as specified in the EPCglobal Class 1 Gen 2 standard. The chip uses an anti-collision algorithm that enables the reading of up to 1,600 labels per second under current US regulations, and up to 600 labels per second under current European regulations. The EPC Gen 2 standard also allows for read/write field programmability, faster tag read/write rates and operation in dense reader environments.

Availability

The UCODE EPC G2 chip is available now. Compatible products based on the UCODE EPC G2 IC are available from the member companies of the Philips Gen2 Task Force program.

About Royal Philips Electronics

Royal Philips Electronics of the Netherlands (NYSE:PHG) (AEX:PHI) is one of the world's biggest electronics companies and Europe's largest, with sales of EUR 30.3 billion in 2004. With activities in the three interlocking domains of healthcare, lifestyle and technology and 160,900 employees in more than 60 countries, it has market leadership positions in medical diagnostic imaging and patient monitoring, color television sets, electric shavers, lighting and silicon system solutions. News from Philips is located at www.semiconductors.philips.com.