KODAK LOOSES WAL-MART CONTRACT TO HP

[Anonymous]

http://online.wsj.com/article/BT-CO-20100302-717851.html?mod=WSJ_latestheadlines
KODAK LOOSES WAL-MART CONTRACT TO HP
HP Photo Kiosks Replacing Kodak At Wal-Mart
SAN FRANCISCO hp is pushing rival printer giant Eastman Kodak
Co.  out of an important location: Wal-Mart Stores Inc.stores.Since last
year, the retail giant has been quietly installing H-P “Prints in
Minutes” photo booths, which customers use to make photo prints from
their digital cameras, a Wal-Mart spokeswoman said.The H-P kiosk
rollout, which Wal-Mart says will be completed by this summer, will
dislodge existing photo booths made by Kodak, which has provided its
kiosks to Wal-Mart since at least 2006.Wal-Mart has 8,416 retail units
under various brand names in 15 countries.

The battle over
Wal-Mart is the latest development in a bitter face-off between the two
printing giants. Executives at both companies have lobbed barbs at the
other and disputed claims about their technology. Both covet Wal-Mart
because the retailer’s huge reach means not only the placement of lots
of printer kiosks but also continued revenue from the ink, toner and
paper the photo booths require for operation.”These kiosks stay
installed for nine or 10 years,” H-P Chief Executive Mark Hurd told
investors at a conference in San Francisco on Tuesday morning. H-P gets
“100% supplies connect,” he said, referring to the sales of the
additional printing products.

An H-P spokeswoman didn’t return
phone calls seeking additional comment. A Kodak spokesman said
Wal-Mart’s decision “is in no way a reflection on the quality of our
products.”

The Wal-Mart deal will likely help H-P as it endeavors
to turn around its printer division. During its first-quarter earnings
last month, H-P said its printer division reported a 4% jump in revenue
to $6.2 billion, a performance that exceeded expectations.On Tuesday,
H-P shares fell 0.8% to $51.12, while Kodak shares lost 0.8% to $5.92.
Wal-Mart fell nearly 0.6% to $53.59.

The Wal-Mart deal comes as
the H-P and Kodak exchange cutting comments sparked by Kodak’s claims
its printers can dramatically cut printing costs. Kodak has been
reengineering itself since the digital photography boomeroded its
traditional photographic film and equipment business.”Shame on your
tactics,” Kodak Chief Marketing Officer Jeffrey Hayzlett said in a
message posted on micro-blogging site Twitter. Hayzlett says H-P
undercuts rivals by drastically lowering printer prices, then profits by
keeping the price of ink refills artificially high.”You have a fight
you can’t possibly win,” tweeted Angela LoSasso, the head of social
media strategy for H-P’s imaging and printing group.

[Author]

March 8, 2010 at 2:09 PM