1998-02-05 , ESC-9852

Philips Semiconductors and Hitachi Ltd. today announced an agreement to cooperate in the development of contactless smart card ICs utilising Philips Semiconductors MIFARE ® Technology. Hitachi is confident that contactless smart cards will play a major role in the future growth of the smart card industry and, after in-depth evaluation of available technologies, has chosen to take a technology transfer contract from Philips Semiconductors.

With 30 million cards in use and more than a billion transactions conducted so far, the MIFARE ® Architecture Platform has emerged as the industrial standard for contactless smart cards covering about 90% of this fast growing market. The increasing number of installations in applications such as public transport, road toll, airline ticketing and ID cards enlarges the circle of MIFARE ® system partners offering their services as system integrators, card manufacturers or service providers.

The broad range of products already available on the MIFARE ® Architecture Platform, from low end contactless hardwired ICs up to contactless microcontroller card ICs for Dual-Interface applications, has convinced Hitachi that MIFARE ® offers the best available set of features for contactless smart cards. With the technology transfer contract Hitachi will be free to produce, market and sell products based on the MIFARE ® Technology without any limitations.

Arthur van der Poel, Chairman and Chief Executive of Philips Semiconductors, states: "This agreement is a further endorsement of our MIFARE ® strategy. Our goal is to make it the only relevant technology for contactless smart card ICs in the world. Now with Philips Semiconductors, Hitachi and Siemens as existing licencees there are three leading semiconductor suppliers to independently provide MIFARE ® chip card ICs. This puts us in the unique position to offer the most advanced product portfolio in a highly competitive way.

Commenting on the agreement, Dr. Tsugio Makimoto, Senior Executive Managing Director of Hitachi, said, "Today, MIFARE ® is the leading proven and reliable contactless smart card technology used on a global scale. And the potential of the MIFARE ® Architecture Platform for the future is enormous. The Agreement with Philips Semiconductors is a major step in our strategy to become a leading global supplier of contactless smart card ICs.

Philips Semiconductors, a division of Philips Electronics NV, headquartered in Eindhoven, The Netherlands, is the ninth largest semiconductor supplier in the world. Philips Semiconductors is a leader with a proven reputation in the development and production of cryptocontroller and contactless Smart Card ICs. Philips Semiconductors' innovations in digital audio, video and mobile technology position the company as a leader in the consumer, multimedia and wireless communications markets. Sales offices are located in all major markets around the world and are supported by regional application labs. For more information on Philips Semiconductors Identification, please visit  http://cdrom.semiconductors.com/identification/

Hitachi, Ltd., headquartered in Tokyo, Japan, is one of the world's leading global electronics companies, with fiscal 1996 (ending March 31, 1997) consolidated sales of 8,523 billion ($68.7 billion*). The company manufactures and markets a wide range of products, including computers, semiconductors, consumer products and power and industrial equipment. For more information on Hitachi, Ltd., please visit Hitachi s Web site at www.hitachi.co.jp

(* At an exchange rate of 124 yen to the dollar.)

MIFARE ® is a registered trademark of Philips Electronics N.V.