Reuters

NEW YORK -- Storied high-tech executive George Fisher will lay down his biggest bet Tuesday since becoming chairman of Eastman Kodak Co. 16 months ago.

In a slick Silicon Valley-style marketing event, Fisher will roll out his strategy, deals and products for developing what he has described as the century-old company's growth engine of the late 1990s and beyond -- digital imaging.

``Kodak wants to put a stake in the ground and say it's the leader in digital imaging,'' said Tim Bajarin, an industry consultant with Creative Strategies.

A $1,000 digital camera, licensing pacts for its PhotoCD technology with personal computer makers, strategic alliances with other companies, and scanners and printers for professionals will be announced at a San Francisco news conference, industry sources said.

Kodak and its famous yellow-and-black film boxes virtually spell photography for hundreds of millions of consumers around the world, but the business is growing ever more competitive.

Traditional film and camera sales are stagnating and face still more competition from digital imaging, or electronic photography, which is growing cheaper and technically more sophisticated every year.

``Devices will become central in digital imaging, as the processing of film is eliminated,'' Bajarin said. Much processing of film and photographs, along with the huge amounts of Kodak papers and other supplies used in traditional print-making, are on the way out, he said.

Kodak declined to comment on the San Francisco event, other than to say Fisher and Carl Grusin, a former Apple Computer Inc. executive who now heads Kodak's digital businesses, will give televised talks in San Francisco next Tuesday. The speeches will be carried live in New York, Washington and London and televised later in Sydney and Tokyo.

``It's as close as we can make it to a live global news event,'' a Kodak spokesman said.

Industry sources said Kodak was talking to telecommunications companies AT&T and Sprint about employing Kodak technology to carry digital images such as X-rays over long-distance lines but any deals were unlikely to be announced Tuesday.

Fisher, former head of Motorola Inc., in the past year has sold off Kodak's drug unit and other businesses, cut debt and worked to bolster morale among employees weary of repeated restructurings.

Analysts question whether the strategy will work, despite Kodak's $5 billion investment in digital research.

``Kodak has to establish a culture that's more entrepreneurial, more like that of the scores of companies which compete in these areas,'' said Eugene Glazer, analyst at Dean Witter Reynolds.

Industry sources said Kodak will introduce a $1,000 digital camera aimed at up-market hobbyists. Kodak and others such as Sony Corp. already sell digital cameras, which produce images without film, but they generally cost $3,000 to $5,000.

Kodak also will try to revive its PhotoCD system with consumers, who spurned the digital technology for displaying and storing photographic images in a stand-alone machine. Kodak is expected to position PhotoCD as a computer product.

``Alliances with PC makers will be key,'' said Bajarin.

Bajarin said he could see the influence of ex-Apple Computer Chairman John Sculley in the high-profile rollout of Kodak's digital strategy. Sculley is a consultant to Kodak.

``Sculley played a big role in this. At Apple, they perfected event marketing of this sort,'' Bajarin said.

Published 3/23/95 in the San Jose Mercury News.

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