HP to shutter Asian digicam sales

Home photo printing will become company's new focus in Japan, Korea, China and India.

Hewlett-Packard is bowing out of the digital camera business in Asia and instead will turn its attention to home photo printing in the region, the company said on Tuesday.

The world's No. 2 PC manufacturer will stop selling digital cameras in Asia "to increase focus on products that have the highest possible return," an HP representative told CNET News.com. The company will continue to sell digital cameras in North America, Europe and Latin America, HP said.

News of the withdrawal comes just days after HP said it would stop selling Apple's popular iPod portable music players under its own brand.

HP announced plans last month to cut 10 percent of its workforce under new chief executive Mark Hurd.

Asia, and Japan in particular, is home to some of the world's best-known digital camera brands, including Pentax, Nikon, Canon and Konica Minolta. That made selling cameras in the region a Herculean effort for HP, even with its "sizable efforts," IDC analyst Chris Chute pointed out.

"HP tends to compete on price, so if you are not an affluent consumer in the coastal areas of the region, you tended to purchase local brands, which were less expensive." Chute said. "Cameras have always been ancillary to their printer announcements anyhow."

Dropping camera sales in Asia is probably a good move anyhow, Chute said. IDC's stats show HP barely made a dent in the region, with sales so small they were lumped into the "other" category, which last year made up 9 percent of the market, excluding Japan. HP fared better in the rest of the world, ranking No. 5 in the United States and No. 7 in Europe and Latin America.

Canon remains the digital camera king, according to IDC, with worldwide shipments of 12.63 million cameras, 17.1 percent of the market. Sony came in second with 12.32 million, or 16.7 percent, and Kodak was third, with 8.71 million, or 11.8 percent. Overall shipments were 74 million units.

HP separates its Photosmart digital photography line into home/office and business use. The company has also ventured out into some customized brands including its limited-edition HP Photosmart R607. Designed by pop music vocalist Gwen Stefani, the teal-colored case came with Japanese Harajuku branding along with a carrying case and charms. Only 3,000 were produced.

Reuters contributed to this report.
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