In a major announcement today Kodak has stated that it will stop selling its APS and reloadable 35 mm film cameras in the United States, Canada and Western Europe. It will continue to make disposable 'single use' film cameras for all markets and will continue to sell reloadable 35 mm film cameras into 'emerging markets' such as China, India, Eastern Europe and Latin America. This effectively means the end of all APS cameras from Kodak, worldwide. Kodak is shifting more of its efforts towards the ever more popular digital camera products.

Press Release:

Kodak to Accelerate 35mm Consumer Film Effort in Emerging Markets

ROCHESTER, Jan. 13 -- Eastman Kodak Company today announced that it will accelerate its 35mm consumer film efforts in growing emerging markets, one of a series of moves that represents the continued implementation of the digitally oriented growth strategy announced by the company in September.

As part of that strategy, Kodak will manage its worldwide traditional photographic business through selective investments for growth that serve customers' needs.

"Kodak is, and will remain, committed to manufacturing and marketing the world's highest quality film," said Bernard Masson, President, Digital & Film Imaging Systems, and a Senior Vice President, Eastman Kodak Company. "Consistent with our strategy, we will focus our film investments on opportunities that provide faster and attractive returns, while reducing investments where we see unsatisfactory returns."

In keeping with that approach, the company will:

• Increase its commitment to 35mm reloadable camera sales and manufacturing in emerging markets, such as China, India, Eastern Europe and Latin America;
• Introduce worldwide new high performance 35mm and APS films next month;
• Continue to manufacture APS films, consistent with consumer demand;
• And, end distribution of reloadable APS cameras worldwide, and reloadable 35 mm cameras in the U.S., Canada, and Western Europe by the end of 2004.

"We are reinforcing and expanding our commitment to 35mm film and cameras in emerging markets because of the significant demand from China, India, Eastern Europe and Latin America," Masson said. "The 35 mm film industry continues to grow at double-digit rates in those markets."

As a result, Kodak will introduce this year six new cameras designed specifically for emerging markets. Additionally, Kodak has been driving significant distribution expansion of Kodak 35mm cameras in emerging markets, where the company expects to sell cameras at more than 85,000 locations in 2004, up 55% from 2003. Kodak will be supplying this increased demand out of their existing operations in China and India.

Kodak is committed to delivering enhanced, feature-rich film products that not only meet the needs of the marketplace, but that also provide consumers with a tangible benefit, whether digital images from film, clearer pictures or more flexibility in photo-taking environments.

"We are exiting the APS camera business because of declining consumer demand, which has led to unsatisfactory returns," Masson said. "Selling APS film and photofinishing remains a very attractive business for retailers. In addition, consumers who use APS film are highly loyal to the format. We remain committed to delivering enhanced consumer benefits in our APS films, and we will continue to provide service and support for retailers and consumers."

Kodak will work with its retailers throughout 2004 to provide assistance in sales and merchandising as they sell existing inventories of APS cameras to consumers.

Underscoring its dedication to the film category, Kodak has introduced eight new films and photofinishing services in the last two years, including KODAK 35 MM and APS High Definition Film, KODAK PLUSDigital one-time-use-camera and KODAK PERFECT TOUCH processing. Kodak will continue to provide innovative film products that meet new channel needs and drive new consumer applications.