Philips, which has been known worldwide for its lighting, electrical appliances and medical equipment , is increasing its investment in health technology.
The company plans to launch smart-assisted diagnostic software that will help doctors better diagnose diseases such as cancer, thereby competing with rivals GE and Siemens and gaining greater market share in the potential medical solutions market.
These software will further enhance the ability of doctors to interpret data. For example, in the analysis of scan results, new intelligent software can use different colors to display more subtle differences between scan results, which were often ignored by the human eye.
According to Philips CEO Frans van Houten, the medical software market has great potential and will likely double the growth rate of the traditional medical instrument business. At present, the Philips software business has annual sales of 3 billion euros, accounting for nearly 18% of Philips' overall sales.
Philips' traditional medical instrument business includes scanners and other large medical devices. In Van Houten's view, the market needs a better interpretation of existing data than more scanners.
At a meeting in London earlier this month, Van Houten also told investors that he hoped that Philips would be seen more as a software provider than a traditional manufacturer of light bulbs, televisions and CD players.
In fact, Philips has withdrawn from many traditional industries to focus on the medical field. Every year, Philips invests 1.7 billion euros in research and development, and the information department is also the focus of investment. Van Houten hopes to expand its information product line through internal research and development rather than acquisition.
In the medical field, the gap between Philips and the old rival has been widened. Bloomberg Intelligence data shows that in the past 12 months, the profit margins of GE and Siemens medical departments were 16.9% and 15.7%, respectively, while Philips' figure in this block was only 8.9%.
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