Eastman Kodak Co, the inventor of the digital camera, plans to get out of that business in the first half of the year as the bankrupt company looks to cut costs.
The decision to stop selling digital cameras along with pocket video cameras and digital picture frames marks the end of an era for the inventor of the handheld camera.
Kodak, which filed for bankruptcy protection last month, said that getting out of cameras would result in "significant" job losses. Most of the 400 people in that business are based in Rochester, New York, and work in research and development and marketing.
The news comes as Kodak meets obstacles in another cost cutting move tied to its illustrious past. The company will be unable to end its 20-year sponsorship of the Hollywood Theater that hosts the Academy Awards before this year's Oscars.
Now, instead of designing its own cameras, Kodak will try to license its brand to other camera makers, several of which have already expressed "significant interest," said spokesman Christopher Veronda.
Kodak, which as recently as 2006 was one of the top three digital camera makers in the world, will stick with its desktop printer business, on which it has focused more recently.
"The printer initiative took over (in the last decade), and they took their eye off the ball in the camera and camcorder space," said IDC analyst Christopher Chute.
However, even in printers, Kodak is far from the top of the pile. It still lags in sixth place in the U.S. market despite being the only brand to grow in the double-digit percentage range in the last two years, according to NPD Group research. The U.S. printer market is led by HP, Epson and Canon.
Kodak, which opened for business in 1880, also invented digital cameras with Wi-Fi connections and touch-screens as well as docking stations that made it easy to transfer photos to computers, according to IDC's Chute.
These were among the products that gave Kodak a 10% market share in 2006, behind Canon and Sony Corp. By 2010 it had dropped to seventh place behind rivals like Nikon and Samsung, according to IDC.
But as the quality of digital cameras in cellphones improved, stand-alone cameras' relevance became somewhat limited to the higher-end market, where Kodak did not compete in recent years.
Kodak — which once employed more than 60,000 people — has not disclosed its employee numbers since the end of 2010, when it announced that it had a work force of 18,800. Today's employee base is smaller than that.
FROM HOLLYWOOD TO INKJETS
Kodak came under pressure from investors because margins are higher for products such as photography film and printer ink cartridges, which consumers buy far more frequently than cameras.
Before the digital age, Kodak cameras included the Brownie — launched in 1900 with a $1 price tag — and the Instamatic, which was launched in 1963.
A Kodak camera was used on the Apollo 11 mission in 1969. And NASA said that a Kodak camera was used by astronauts to film lunar soil from only inches away.
Kodak film has been used on 80 movies that have won Best Picture Oscars.
In a stark move away from its more glamorous past, Kodak recently had to ask for permission to end its 20-year Hollywood Theater sponsorship, worth $72 million. However, it was told in a filing late Wednesday that it could not get out of the deal ahead of the Feb 26. Oscars ceremony.
"The invitations and advertisements for the 2012 Academy Awards show are out. They cannot be recalled," CIM Group, the owner of the theater said in a court filing.
