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Kodak's Big Picture Focusing on Image Change
via NewsEdge Corporation



Kodak's transformation won't be deemed successful until it can demonstrate sustained earnings from continuing operations, Vleeschhouwer said. In the third quarter, Kodak lost $103 million from continuing operations.

"The question is can Kodak show profitability and/or market share sufficient to compensate for their older businesses," Vleeschhouwer said. "Once a large base of digital cameras are set, the end game will be which company has captured the printing market."

In decades past, no company outside of Fuji was able to make much of a dent in Kodak's domination of the film market. These days, Hewlett-Packard, Canon and Sony have much the same game plan as Kodak: sell digital cameras and get trigger-happy consumers to buy their printing services. In addition, Kodak faces online competition from a number of Internet-based digital operations.

"There are no more 'moats' anymore," Gerard said. "You can no longer build a moat that another competitor can't bridge in six months."

The company's strength, Gerard said, is its brand name: Kodak still is equated with photography, especially in the United States. But, experts said, that brand needs sharpening.

Too many people, Gerard said, think of Kodak as a film processor with orange counters in drugstores. But Kodak's new dual-lens camera and thermal photo printers, for example, have received high marks.

Perez has the daunting task of giving an older company a new look while simultaneously appeasing investors interested in short-term results.

"Perez and management completely understand what they must do," Gerard said. "But it's no picnic making all these transitions in products and people while Wall Street is breathing down your neck."

E-mail llazaroff@tribune.com.

<<Chicago Tribune (KRT) -- 01/30/06>>


   







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