Your humble editor sat down with Zia Eftekhar, President, Lighting North America, at Light and Building tradeshow in Frankfurt.
Randy: What is the overall focus for Philips at this show?
Zia: The overall focus for Philips is the presence of LED, not so much from a technical basis, but how Philips can use this fantastic technology in more flexible applications. Not only is energy reduction important, but we also want to enhance the environment and atmosphere
Today, we have much more emphasis on control of products. The products are more intelligent and improve productivity in the work environment, while improving comfort. Schools will be able to manage the color of light to improve or enhance learning ability. Philips created the SchoolVision solution to give teachers flexibility in creating the right lighting for the right activity within the classroom. By making the learning environment as comfortable as possible for each activity, Philips’ SchoolVision solution helps to optimize the learning environment for teachers and pupils.
Randy: I have heard discussion about improving productivity for students but are there actual independent studies?
Zia: Yes, there is a study out of Hamburg which had a series of features that were geared toward following kids’ reactions to the various colors and intensities of light. It went through the whole circadian cycle and concluded that lighting could improve attention by adjusting the color intensity throughout the day. Similar tests are occurring in Tupelo, MS, and Fall River, MA.
Randy: What about LED costs?
Zia: Price points have reached the tipping point in some markets, like outdoor lighting. The value proposition is really achieved now in certain applications, especially with commercial developments where the owner is concerned about total owning costs. The payback for new construction in many cases is two years. For retrofit, we are looking at a three year payback for many applications. LED offers flexibility, great color, and intelligence—now it offers a value proposition as well.
Randy: But are the consumers responding as fast?
Zia: The consumers are more focused on initial cost. Total cost of ownership is not in their vocabulary. They think about one dollar versus twenty dollars. Early adopters are picking it up.
As you know, Philips has a large presence in DIY and our LED sales are growing quite fast. With Utility rebates we are getting to a $20 equivalent price. Now, for the masses to follow, the A19 lamp will need to be about $10. Philips has already announced in Europe that we will get to the 10 Euro range for a 40 watt replacement and we think that will be a tipping point. In Europe the 40 watt is important. In the US, it is the 60 and 75 watt that are important. Let me stress the 10Euro in the EU is before rebates.
Randy: What are your projections for LED penetration?
Zia: We think that LED will achieve a 45% penetration rate by 2015 and as much as 75% by 2020. Let me stress, this is an adoption rate for all of lighting globally. Obviously, when looking at the commercial sector by itself, it will be significantly faster. One example is Exit Sign lighting: Exit Sign lighting went from incandescent to fluorescent and now it is virtually 100%LED in the last ten years. Traffic lights have tipped over to LED with most people not even noticing.
Randy: What about OLED?
Zia. Definitely OLEDS will be a big part of the future. We have invested an additional 40M Euro in that technology
There are inherent flexibilities in both applications and manufacturing as OLEDs are applied directly on surfaces and we do not need the multiple structures that are needed with LED. We are focusing to improve efficiency and cost. These cost reductions will come from technology improvements and mass production. Will it replace LED? No, but it brings another set of tools, both in the professional arena and consumer.
OLEDS offer so much application flexibility. For example, today lighting cannot be added to windows as the windows need to remain open for daylight to enter. With OLEDs, we can place a panel on the window that allows sunlight to enter by day and the OLEDs do the job in the evening.
Randy: We are hearing stories of cities turning off streetlights, especially in the UK. What are your thoughts?
Zia: If changing lifestyles is the only solution, that would be very sad. In a few minutes we will demonstrate to you our City Touch system that allows Streetlights to dim. It is our latest offering and it joins a strong line of customized solutions for outdoor applications that save energy and boost efficiency.
For example, there is a highway in The Netherlands that is fitted Philips’ Speedstar LED solution, which can recognize congestion, as well as pedestrians and adjust accordingly.
This is a holistic approach to lighting and it is extremely efficient.
Randy: What is going on with your other technologies, such as HID?
Zia: A lot. We have fantastic Ceramic Metal Halide lamps for many applications. Even halogen will be with us for quite some time, as will fluorescent. The Cosmopolis is really taking off, which is an intermediate step between HPS and LED.
Remember, more candles are sold today than when they were the only source of light. So there are a lot of legacy technologies that will remain viable for many decades.
Randy: Do you see the channels of distribution continuing to blur?
Zia: The old compartmentalized relationships have changed. Ultimately, we provide solutions to end users through various channels. It is a much more collaborative partnership. There is no passing a baton from one department to the other.
Clearly we must understand what the end user needs, regardless of channel. One of the best sources from gaining insight is from the specification community, which was the most important continuity in the Genlyte days and it is still extremely important to us now. Let me emphasize that all of our trade partners play an important role.
Philips showed me several new products:
City Touch is a communication system that controls and monitors streetlights. It is available in power line carrier and RF. In addition to controlling the fittings, City Touch can report outages as well.
Pure Detail is an attractive name for an attractive product. Part of the issue in retail today is that most everything can be purchased on the Internet. People do like to go out for social reasons and stores have to do much more to pull them in. Pure Detail is a high-end LED system, designed to display high-end products. Because of the intensity of the light, many shadows are created giving the merchandise depth. This 90 CRI lamp will bring out every detail. Warning—it will also bring out every flaw.
Think of how a television in sports bars brings people inside. Retailers are using video to draw people as well. We witnessed a product demonstration, where a customer walks near a display, which immediately lights up. When the customer reaches to touch a product, the product is bathed in light. Picking up the product signals the monitor to explain its features and benefits. Research indicates that once a consumer touches a product, there is an 80% chance it will be purchased.
AmbiScene. Pure Detail convinces the customer of the attractiveness of the clothes—on the mannequin. The real test is how the consumer will look in those new clothes. Push one button on the magic mirror on the wall and the ambient lighting is set for an office environment. Push a different button, which I will call the lingerie button, and you will look stunning.
It is exciting to see companies featuring more than sources and fittings. Philips is truly selling an entire experience and that helps the retailer sell as well.