Commentary: Kodak is getting off the dime with digital

By James Lundy, Gartner Analyst

Eastman Kodak's purchase of a piece of digital-photography Web site PhotoAlley.com and Kodak's CD deal with Circuit City are encouraging signs that the world's largest photography company is getting serious about the digital-photography market.

	See news story: Kodak sharpens its digital focus

Kodak seems to be recognizing--somewhat belatedly--that it must form partnerships with companies that can provide digital photography services that will enhance Kodak's camera lines and paper products, since as the digital photography revolution progresses, Kodak will inevitably sell less film. The alliances announced this week are likely only a first step.

It is probably not accidental that Kodak's announcement of the PhotoAlley.com and Circuit City marketing initiatives coincides with its hiring of Ted Lewis to oversee digital-business development. Lewis helped create DaimlerChrysler's Silicon Valley venture capital fund and will now attempt to create the same kind of digital-business incubator for Kodak.

Kodak has the right idea here; however, it must execute aggressively. Although digital-photography products have not yet reached the stage of widespread adoption, they're getting there fast. Kodak is in an excellent position to leverage its high brand recognition and consumer trust into a solid position of leadership in the digital photography market, provided it does not allow itself to fall too far behind its competitors.

(For related commentary on digital-camera storage technologies, see TechRepublic.com--free registration required.)

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