Today, Eastman Kodak Company announced that in the first half of 2012 it plans to phase out its dedicated capture devices business- including digital picture frames, pocket video cameras and digital cameras, due to its commitment to drive sustainable profitability and ongoing strategic review process via its most valuable business lines. Instead, Kodak will seek licensees and develop its current brand licensing program in the fore-mentioned categories. The Consumer Business of Kodak will include desktop inkjet printing as well as retail-based and online photo printing following this decision.
In order to ensure a well-regulated transition, Kodak got in touch with its retails partners and is working closely with them. However, Kodak will continue to provide technical service and support for its digital picture frames, pocket video cameras and cameras as well as honoring all related product warranties.
Pradeep Jotwani, Kodak Chief Marketing Officer and President, Consumer Businesses said that for quite some time the strategy of Kodak was to improve margins that were related to the capture device business and the company managed to succeed by narrowing their participation in terms of retails outlets, geographies and product portfolio. He added that given their analyses of the industry trends, the announcement they made today is the logical continuation of that process.
Kodak anticipated to accomplish annual operating savings of nearly $100 million upon completion of the phase out. As a result of exiting the business Kodak expects to suffer a fine due to separation benefits of nearly $30 million.
Apart from its Consumer Businesses department, Kodak has a Commercial Businesses department that includes the Commercial Films, Entertainment and Graphic, Enterprise Solutions and Services, and Functional and Digital Printing units. Now, three-fourths of Kodak’s total revenues is comprised by its digital business.
In the personal imaging market, Kodak continues to have a strong position. Even though photos are growingly taken on present-day mobile devices, Kodak technology provides consumers with an easy way to create a wide range of photo products, anytime, anywhere, such as personalized calendars, photo greeting cards, photobooks and prints. These items can be made with Kodak quality at home, at retail, on Kodak products, and ordered for delivery to home.
Kodak’s current consumer services and products will include:
- Digital dry lab systems and retail-based photo kiosks, a market in which Kodak is the worldwide leader. The retail-based kiosk market was pioneered by Kodak, and the company currently has more than 100,000 order stations for dry lab systems and kiosks around the globe, and the most popular photo-sharing sites are connected with nearly 30,000 of those units.
- For several years, Kodak has outstripped overall market growth in consumer inkjet printers. The lowest total ink replacement cost and high-quality output were provided to consumers by Kodak consumer inkjet printers. From anywhere, using any web-connected device, consumers can send photos and documents to Kodak printers.
- Using photos from their Facebook albums via Kodak apps for Facebook, consumers now have an easy way to obtain photo products.
- The leading online digital photo products service called Kodak Gallery (kodakgallery.com). This service allows consumers to share their photos, and provides creation tools and products that lets people do more with their photos.
- The Kodak batteries businesses and camera accessories. With all camera brands, these products are universally compatible and extend into charging units for smartphones.
- The traditional photographic paper and film capture business, which is still providing innovative and high-quality solutions and products to professional labs, photofinishers, retailers, photographers and consumers.