News

Picture of competition

New technology and growing consumer demand are pushing established companies like Kodak to introduce new and improved photo kiosks. The influx of others, like Polaroid, into the market indicates a competitive market for retail space.

March 3, 2003

Picture this: Photo-finishing kiosks found not only in drug stores, grocery stores and photo shops, but also convenience stores, hotels and electronics outlets. Imagine them being as common as ATMs.

According to Photo Marketing Association International (PMAI), photo-finishing kiosks are making their way into all sorts of venues because of consumer demand for convenience and the technology that allows for self-service printing of photographs. There's also a number of companies introducing new products targeting retail.

"Digital cameras are growing rapidly, and there is demand for convenient prints," said Gary Pageau, PMAI's associate publisher-editorial. "Also, recent technology-like inkjet, dry film processing and thermal dye-sub printing makes photo kiosk placement possible in places where conventional processing isn't feasible. And kiosks offer in-store cross-merchandising possibilities."

As a result, Pageau said, several companies have joined established players Kodak, Fuji, Agfa and Pixel Magic in the photo-finishing kiosk niche. The relative newcomers include Lucidiom, Applied Science Fiction, Sony, Olympus, and most recently, Polaroid.

Leader of the Pack

Not surprisingly, Kodak is dominant in the industry, having developed and marketed its first photo kiosk in 1995. (see story, Picture This) Sha'Nia Dickerson, the company's consumer imaging spokeswoman, said Kodak maintains its commanding presence through, among other things, product innovations.

"We are always working to improve our kiosks such as with the new Kodak Picture Maker G3 family," Dickerson said. "This new family of Picture Maker kiosks offers a new level of consumer ease-of-use, advanced imaging features, upgradeability, configurability and connectability to meet the specific needs of Kodak retailers."

Dickerson cited Kodak's role in the growth of the technology.

"No one supports the imaging kiosk business like Kodak," she said. "We continue to drive consumer awareness and trial of Kodak Picture Maker through national TV and print advertising as well as offering turnkey national promotions for our retail partners. Kodak started the imaging kiosk industry and has an intricate understanding of consumers' needs. We continue to invest significantly in research to understand and anticipate consumer needs, thus delivering the best value proposition to consumers through the Kodak Picture Maker."

A more crowded field

Fuji spokeswoman Rosemary Valenta said her company's success in the photo-finishing sector could be attributed to its products' versatility.

"We believe that the current marketplace is adjusting from print-to-print kiosks, which could handle single images at a time, to kiosks which are more focused on printing from digital images, in multiples," Valenta said. "For example, our Aladdin kiosk can be networked to a Pictrography scanner for print-to-print, but is also a stand-alone digital imaging kiosk."

Valenta said Fuji would announce the release of a new Frontier Digital Lab System (the 340), a new Printpix DigiCam Center (the 400) and a new Fujicolor CD/DVD at the Photo Marketing Association trade show.

The most recent newcomer in the industry is Polaroid, which also introduced a kiosk product at the PMAI show - the Polaroid Instant Digital Prints Kiosk.

The Polaroid kiosk produces 4x6 digital prints at a rate of one print per two seconds. Polaroid touts its speed as a unique advantage. It also has an all-in-one, self-service ATM-like interface, and enables a customer to select, print and pay for 24 4x6 photos in less than two minutes.

Its revolutionary thermal printing platform, called "Opal," features a unique, "frozen ink" technology that is at the cornerstone of the Polaroid system and is the main driver behind the kiosk's speed. In a news release, the company said the new product marks its entry into the kiosk space, and that installations will begin this quarter.

Kodak's Dickerson said her company is making inroads into several market segments, with digital photography clearly one of the engines driving the photo-finishing industry.

"While Kodak Picture Maker kiosks continue to permeate the traditional mass market and drugstore photography market segments, we have introduced the kiosk to copy centers, office supply retailers and other non-traditional channels as well," Dickerson said. "The advent of printing from digital cameras provides an opportunity to expand imaging kiosks into more convenience-type locations."

She said Kodak has begun a market test in Atlanta which places digital printing kiosks in hotels, gas stations, electronics stores and other retailers.

Kodak is forming partnerships to promote digital photofinishing. For example, in early February 2003, Phogenix Imaging, a developer of retail thermal photofinishing solutions, began testing its DFX Digital Photofinishing System at New York area photo shops. Phogenix is a joint partnership of Kodak and Hewlett Packard. The Phogenix DFX is a mini-lab that uses commercial thermal inkjet technology to print photographs.

"As consumers develop an affinity for the benefits of choice in digital photofinishing, they'll appreciate the many options for previewing, enhancing and producing consistently better pictures in any size, format and quantity," said Fred Heigold, chief executive of Phogenix Imaging. The Phogenix DFX received an industry award for image quality and color accuracy as part of a product comparison conducted at the 2002 PMAI annual convention. The DFX, which debuted at the show, was the only digital mini-lab to garner an award for product innovation.

Other companies are making inroads in the market. For instance, Pixel Magic Imaging Inc. will provide photo-imaging kiosks to more than 100 camera centers owned by a Canadian-based one-hour photo company, according to a February 17, 2003, story in the Austin (Tex.) Business Journal. Pixel Magic will provide its iStation Systems to Japan Camera Centers Inc. of Ontario. The iStation is a countertop kiosk that provides digital camera printing, image CD burning and image enhancement.

A snapshot of the industry

The photo kiosk sector will continue its growth through 2006, but the poor economy is slowing that growth, according to a 2002 report issued by digital imaging research firm InfoTrends Research Group.

According to the organization's 2002 report "Photo Kiosk and Retail Digital Photofinishing Forecast," the number of installed photo kiosks in North America grew from about 26,000 in 2000 to 28,000 in 2001. Steady growth will continue, with 2006 estimates set at 33,000 units, but that is a far cry from 2001's prediction of 150,000 units by 2006.

The report also shows that digital kiosks are taking on an ever-increasing share of the photo kiosk market. Nearly half the photo kiosks shipped during 2002 were expected to be digital exclusive, as compared to 16 percent in 2001. Faster print speeds, the placement of kiosks in more convenient locations, and connectivity to the Internet are all expected to attract more customers to photo kiosks, according to the report.

Photo-finishing kiosk companies are trying to keep abreast of the rapid growth in digital cameras.

"With the explosive growth of digital photography, Kodak is ready to show consumers how easy it is to print their digital camera pictures at retail," said Scott Auer, vice president of photofinishing services/consumer imaging for the U.S. and Canada. "With current digital camera users taking significantly more pictures than film users, we know this retail marketplace shows unlimited growth potential. Tapping this market supports Kodak's mission to drive output and make digital easier."

Fuji spokeswoman Valenta pointed to the strong growth in the digital sector. "We've been having great success with our Digital Camera Developing initiative," she said. "The initiative includes our digital imaging kiosks, and sales took off last year and continue to be strong."

Fuji commissioned InfoTrends Research Group to study the photofinishing market. In a report issued in October 2002, InfoTrends reported that 68 percent of respondents said they would prefer to use a self-service kiosk to get their prints.

The top three reasons for an interest in using such kiosks were, "to get prints immediately," "to have more control over the final results," and to have "convenience of 24-hour access," according to the study.

For more on PhotoKiosks, go to Kiosks.org.