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Philips was eager to join forces with B&O in the upscale consumer electronics market. Philips had
a product designed for this market but it did not possess the high-quality image of B&O’s products.
Philips was also worried that if financial pressure continued, B&O might choose a competitor as a
partner. A Japanese competitor would be very damaging. Philips had always been supported politically
by B&O in its efforts to gain national and EU support to make the remaining European companies
more competitive vis-à-vis Japanese competitors. Philips was also interested in cementing relations with
B&O as a major customer for Philips’ components.
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LouCypher
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