High definition entertainment will be the centre of attention at the IFA consumer electronics show which opens in Berlin on Thursday.
The Blu-Ray format goes head to head with HD-DVD
More than 1,000 exhibitors will show their latest products and gadgets to more than 273,000 visitors.
High definition TVs and next-generation DVD players - HD-DVD and Blu-Ray - will be on display.
An estimated 14 million HDTVs are expected to have been sold in western Europe by the end of 2006.
Lucas Covers, Philips' chief marketing officer for consumer electronics, said: "High definition is at the heart of our product line.
"We believe the European market is ready for high definition DVD. The World Cup was a real catalyst."
The success of the 2006 World Cup in driving sales of high-end home entertainment systems has raised expectations at the IFA show, which this year makes its debut as an annual event.
Demand for flat screen TVs, MP3 players and digital and HD TV equipment shows little sign of abating, analysts at the show said ahead of its opening.
For many, continued high demand has raised the stakes in Berlin.
"The industry will continue on the road to digital convergence, but I don't expect major new products," said Jurgen Smit, of Dutch retailer Polectro.
Instead, attention at the IFA show is likely to fall on the growing battle between rival HD video formats.
Philips is backing the Blu-Ray format, which goes head to head with rival system HD-DVD.
Analyst Screen Digest recently predicted that the battle between formats to win over consumers would end in stalemate and said the overall market for high-definition DVDs would be depressed as a result.
Philips' Mr Covers said he did not think the rivalry was a problem for the consumer and dismissed suggestions that they could be confused.
Philips is showing trial technologies such as clothing with images
"In the end the consumer has to make the choice to buy or to wait."
Some analysts predict dual-format DVD players capable of playing both HD-DVD and Blu-Ray may be the answer but they are not on the horizon for the mass market.
"We really have confidence we are doing the right thing," said Mr Covers.
The Dutch giant is also showcasing technology which puts moving images into fabric.
The Lumalive technology means dynamic adverts and graphics can feature on clothing.
Bas Zeper, managing director of Photonic Textiles, Philips Research, said: "The light emitting textiles have to be flexible, durable and operated by reasonably compact batteries.
"Fitting all that into a comfortable, lightweight garment is a considerable engineering success."