News

Philips Cuts Crystal Line Products

10/18/1998 8:00 PM Eastern

Philips Broadband Networks took dramatic steps to change
its position on cable-telecommunications products last week, canceling its existing
product line and laying off one-dozen workers who were affiliated with it.

Effective immediately, Philips will shift its focus toward
packet-based telecommunications, a spokesman for the company said.

Until last week, Philips had been marketing an HFC (hybrid
fiber-coaxial) telephony product under the brand name, "Crystal Line." The line
included a "daughter card" for a nonstandardized cable modem, which had briefly
been branded as "the un-modem" to differentiate it from other, standards-based
offerings.

But neither the phone equipment nor the cable-modem gear
had enjoyed much market success, in terms of major MSO orders. Last year, Oneonta
Telephone Co. -- an independent telephone operator in northern Alabama, with 7,100 cable
and telephone customers -- ordered the Crystal Line system. A few other small independents
and international operators also used the gear.

The equipment consisted of transport and home electronics,
including a subscriber-interface unit that offered two lines of telephony and a place for
the 128-kilobit-per-second "un-modem" card.

All of that goes away, effective immediately, the Philips
spokesman said.

According to a prepared statement, Philips plans to
"increase its investment in cable modems, digital and packet-based"
technologies, while "ceasing development of circuit-switched cable-phone" gear.

"The original plan was for a migration, but we decided
to shortcut," the spokesman said.

The statement went on to say that Philips is now
"focused on developing next-generation digital-access platforms capable of digital
voice, data and video application segments."

Specific product announcements "will be
forthcoming," the manufacturer said.

Philips officials were quick to point out that the demise
of Crystal Line will not affect the company's broadband-cable division, which
produces fiber optic and network-amplification products for cable operators.