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Photofinishing Alliance Made
via NewsEdge Corporation

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Nov. 7, 2006) - PhotoChannel Networks Inc. (TSX VENTURE:PN)(OTCBB:PNWIF) ("PhotoChannel" or "PNI") today announces signing an agreement with Qualex Inc. (a wholly owned subsidiary of Eastman Kodak Company). This agreement enables both companies to mutually develop new and existing opportunities in the retail photofinishing marketplace and pursue new customers outside of traditional photofinishing players. PhotoChannel and Qualex will collaborate in the development and deployment of new business opportunities fulfilling specific market needs with an array of online products and services. The agreement facilitates leveraging each company's core competencies, namely PhotoChannel's PNI Digital Media Platform and Qualex and Kodak's digital fulfillment systems.

"We have recognized the need for many businesses to provide their customer base with digital lifestyle services and products that can be offered by combining the capabilities of both PhotoChannel, Kodak and Qualex," says Peter Fitzgerald, Chairman and CEO of PhotoChannel. "By utilizing our market leading PNI Digital Media Platform with Kodak & Qualex's immense production and fulfillment capabilities, we can provide photofinishing and non-photofinishing retailers with products and services that will enhance their revenue and customer retention. This new program has the ability to provide significant revenue opportunities."

This new agreement will see PhotoChannel and Kodak target various sectors of the market that have to date not been able to participate in the burgeoning growth of digital imaging, specifically concentrating on retail, commercial, industrial and seasonal lifestyle product markets. "While we focus on delivering solutions for all of our current photofinishing customers we also see that, as the digital imaging industry evolves, there are numerous untapped opportunities across current and alternative channels to profitably grow the market," says Mark DeSimone, President of Qualex. "Together, with PhotoChannel, we will explore many ways of expanding our customers' online products and services such as PhotoBooks and other innovative consumer focused new products. Our goal is to provide the most comprehensive online imaging solutions in the industry with as many products, service and delivery options as possible."

About PhotoChannel- Founded in 1995, PhotoChannel operates PNI Digital Media to provide services for major retailers, wireless carriers and content providers. The PNI Digital Media Platform connects consumer ordered digital content with retailers that have on demand manufacturing capabilities for the production of merchandise. Currently PNI Digital Media generates transactions for retailers and their thousands of locations across North America, including Wal-Mart Canada, CVS/pharmacy, Eckerd Drugs and Costco Canada. For more information please visit

About Qualex and Kodak- Qualex Inc. is one of the largest wholesale photofinishing companies in the world. Qualex offers traditional print and digital output solutions by operating a large network of commercial labs throughout the United States and Canada. The company is a wholly owned subsidiary of Eastman Kodak and is headquartered in Durham, NC. Qualex and Kodak are continuously researching, designing, and implementing innovative output technologies that allow consumers to enjoy their pictures and images in ways never before imagined.


Mr. Kyle HallPhotoChannel Networks Inc.(604) 893-8955 ext. 313

Ms. Niti MainiPhotoChannel Networks Inc.(604) 893-8955 ext. 313Email:

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