Editing PolyGram (section)

=== Philips Phonografische Industrie (PPI), 1950–1962 ===
In the 1940s, the record business was spread out within Philips: research in the [[Eindhoven]] labs, development elsewhere in Eindhoven, recording in [[Hilversum]], manufacturing in [[Doetinchem]], distribution from [[Amsterdam]], and exports from Eindhoven. During the late 1940s, Philips combined its various music businesses into '''Philips Phonografische Industrie''' ('''PPI'''), a wholly owned subsidiary.

PPI's early growth was based on alliances. A merger was first proposed with Decca of London in late 1945, but was rejected by [[Edward Lewis (Decca)|Edward Lewis]], Decca's owner. (PolyGram finally acquired Decca in 1980.)

In the early 1950s, Philips set itself the goal of making PPI the largest record company in Europe.

PPI's second attempt at a merger was with [[Deutsche Grammophon]] Gesellschaft (DGG). DGG, owned by [[Siemens|Siemens AG]], and well known for its classical repertoire, had been the German licensee for Decca from 1935. DGG also owned [[Polydor Records]]. Shortly after PPI was founded it had made a formal alliance with DGG to manufacture each other's records, coordinate releases, and refrain from poaching each other's artists or bidding against each other for new talent. PPI and DGG finally merged in 1962.

The alliance with DGG still left PPI without repertoire in Britain or the United States. But in 1951, after [[Columbia Records|Columbia]] had failed to renew its international distribution agreement with [[EMI]], PPI agreed to distribute Columbia recordings outside the United States. Columbia became PPI's distributor within the US. This agreement ran until 1961 when Columbia set up its own European network. PPI signed a worldwide distribution deal with [[Mercury Records]] in 1961. PPI's parent company Philips, through its U.S. affiliate '''Consolidated Electronics Industries Corp''' (a.k.a. '''Conelco'''), acquired Mercury in 1962.

PPI built or bought factories in smaller countries. In 1962, PPI had a large factory in [[Baarn]] and factories in France, Britain, Denmark, Norway, Spain, Italy, Egypt, Nigeria, and Brazil.

PPI played an important role in the introduction of the long-playing vinyl record to Europe. Columbia introduced their [[gramophone record|LP record]] in 1948, and Philips presented its first LP at a record retailers' convention in 1949. Philips' commitment to LP technology was an important factor in its 1951–1961 deal with Columbia.<ref>Bakker, p.17. "Philips' commitment to the LP technology was an important factor for Columbia's willingness to enter the long-term alliance with PPI in 1950. "</ref>