Amsterdam, the Netherlands/Tokyo, Japan, September 5, 2002 - Royal Philips Electronics (AEX: PHI, NYSE:PHG) and Sony Corporation today announced that they will jointly develop a new near field radio-frequency communication technology, 'Near Field Communication' (NFC). The technology enables short-range communication networks between consumer devices incorporating an NFC interface, and is set to greatly improve the way consumers access data and services wirelessly.

Wireless NFC technology will operate on 13.56 MHz and allow for the transfer of any kind of data between NFC enabled devices such as mobile phones, digital cameras and PDA's as well as to PC's, laptops, game consoles or PC Peripherals, across a distance of up to twenty centimeters and aiming at speeds fast enough to transfer high quality images. At communication speed up to 212 kbit/s the NFC technology is fully compliant to both Philips' existing Mifare™ and Sony's FeliCa™ contactless smartcard technologies.

The aim is to build a ubiquitous open infrastructure of NFC-compliant devices which effectively incorporate smart-key and smartcard reader functions, providing a convenient communication method for services such as payment (including credit card), ticketing, and accessing online entertainment content (e.g. gaming) through the devices. This can be done simply by holding devices or smartcards near each other. It is anticipated that the technology will play a key role in allowing content and service providers to offer various new ways of accessing their services. The consumer's primary NFC device (e.g. mobile phone or PDA) acts as a smart-key to gain access to chosen services from any NFC device, anywhere, anytime.

"This cooperation between Philips and Sony marks a breakthrough in establishing a new solution for an easy communication network between consumer electronic devices," commented Mr. Yuki Nozoe, Corporate Executive Vice President, Sony Corporation. "Together with Philips, we will study a vast range of new applications for NFC, and we look forward to welcoming other electronics and service companies in support of the technology."

Karsten Ottenberg, General Manager of Philips Semiconductors' Identification business, said: "This agreement will revolutionize the way consumers access services and see the penetration of identification chips move far beyond smart cards, with NFC becoming a standard component of new electronic devices, including those from Philips. It is another demonstration of Philips' strengths in the area of connectivity, and what our technologies can bring to the consumer, at home, in the office, or on the move. With the CD Philips and Sony demonstrated what their cooperation can bring to the electronics industry - we look forward to the success of this partnership."

Philips is already the global industry leader in contactless smartcards through its Philips'Mifare™ technology, supplying some of the world's major transport systems, and the banking sector, with supply to customers such as Visa. Sony has a significant market position in Hong Kong and Shenzhen (China), Singapore and Japan utilizing Sony's FeliCa™ contactless smartcard technology, mainly in the transportation and financial sectors. As NFC is fully operable on both platforms, all consumer devices containing NFC technology will be compatible.

Philips and Sony will promote the NFC technology as an open standard in order to integrate it into consumer devices, including those of other manufacturers in the CE, PC, automotive, and other industries. The companies intend to explore new applications together with relevant content and network service providers.

About Sony
Sony Corporation is a leading manufacturer of audio, video, communications and information technology products for the consumer and professional markets. Its music, pictures and computer entertainment operations make Sony one of the most comprehensive entertainment companies in the world. Sony recorded consolidated annual sales of over $57 billion for the fiscal year ended March 31, 2002.
Sony's Home Page URL

About Royal Philips Electronics
Royal Philips Electronics of the Netherlands is one of the world's biggest electronics companies and Europe's largest, with sales of EUR 32.3 billion in 2001. It is a global leader in color television sets, lighting, electric shavers, medical diagnostic imaging and patient monitoring, and one-chip TV products. Its 184,000 employees in more than 60 countries are active in the areas of lighting, consumer electronics, domestic appliances, components, semiconductors, and medical systems. Philips is quoted on the NYSE (symbol: PHG), London, Frankfurt, Amsterdam and other stock exchanges. News from Philips is located at www.philips.com/newscenter

Safe Harbor Statement
This document contains certain forward-looking statements with respect to the financial condition, results of operations and business of Philips and certain of the plans and objectives of Philips with respect to these items. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements. These factors include, but are not limited to, levels of consumer and business spending in major economies, changes in consumer tastes and preferences, the levels of marketing and promotional expenditures by Philips and its competitors, raw materials and employee costs, changes in future exchange and interest rates (in particular, changes in the euro and the US dollar can materially effect results), tax rates and future business combinations, acquisitions or dispositions and the rate of technical changes. Market share estimates contained in this report are based on outside sources such as specialized research institutes, industry and dealer panels, etc. in combination with management estimates.