ABSTRACT
When, in October 1997, Philips and Lucent combined their mobile telephone activities in a joint venture (JV), expectations ran high for what was presumed to be a win-win situation. The cooperation with Lucent provided Philips with the opportunity to enter the American market, where Lucent had well-developed distribution channels and strong brand names. Furthermore, Philips would gain access to Lucent’s renowned research institute, Bell Labs. For Lucent, a JV relationship with Philips seemed to be just what it needed for its consumer product activities. As one of the three split-offs of AT&T, Lucent had become responsible for AT&T’s consumer products. However, Lucent had no expertise in or affi nity with consumer products as its actual ambitions were directed toward the business-to-business market. So, when Philips, which did have experience in the fi eld of consumer products and, moreover, had a strong position in Europe, asked Lucent to combine their consumer product activities in a JV, Lucent agreed. It was decided to set up a ‘shared subsidiary’ with the ambition of achieving a ‘top three position’ on the mobile phone market by 2000.
