Philips, Accton to merge wireless networking units

Koninklijke Philips Electronics NV and Taiwanese networking equipment maker Accton Technology Corp. have signed a letter of intent to create a joint-venture company that would combine the wireless connectivity module units of both partners, the companies said in a statement Wednesday.

The joint venture will develop wireless products based on the Wi-Fi (802.11b, 802.11a, 802.11g) and Bluetooth networking standards, the statement said, noting these products would be intended for a broad range of applications, including service providers, consumer electronics, computers and mobile phones. The joint venture would manufacture these products under contract for other companies, it said.

The company, which has yet to be named, will also develop a product to bridge networks based on Powerline Communication, which uses AC (alternating current) power lines to transmit data, and Wi-Fi networks, the statement said. Down the road, the joint venture is also expected to focus on the development of broadband networking applications, such as streaming video and music, multimedia messaging, and voice over IP (Internet Protocol), it said.

The joint venture, which is expected to be established before the middle of the year, will be based in Hsinchu, Taiwan, and employ around 200 staff drawn from both companies with expected initial annual revenue of around US$250 million, the statement said. Ownership of the joint venture will be split roughly evenly between Philips and Accton, it said.

The new company will not incorporate all of Accton’s wireless networking business and the company will continue to develop and manufacture wireless networking products, said Kris Chien, a spokeswoman for the company.

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