Fuji outlines digital strategy! By
Michael R. Tomkins, The Imaging Resource
(Tuesday, June 12, 2001 - 21:03 EDT)In interviews with Reuters' Edmund Klamann, the Japanese manufacturer discusses its plans in the emerging digital marketplace...
Press agency Reuters has today posted a news item detailing Fuji Photo Film Co. Ltd.'s plans for the digital imaging marketplace. Reuters' Edmund Klamann spoke with Fuji executives for the piece, which reveals a number of interesting points:
Fuji is aiming for a 25% share of the global market. Last year, Nikkei Market Access reported that Fuji had a 15.2% share; the company claims a 20% figure for the year.
Fuji doesn't agree with the idea that the entry-level market is vital to be present in; the company instead thinks entry-level has unnecessary risk due to the need for high sales volumes to get high profits - something that could potentially leave a company with vast quantities of unsold cameras in warehouses.
Fuji launched 9 digital camera models last year; it plans to have 10 models this year.
Company execs consider digital cameras to have a short shelf-life 'like fresh produce' - cameras have a life expectancy of about a year, and can only create a profit for about half of that time.
Fuji's reasoning for creating things like sensors in-house (most companies make their digicams with off-the-shelf sensors or even buy in the entire digicam design from a third party) is that this allows for quicker reaction to marketplace changes. The company keeps costs down by doing more than half of its digital camera assembly in China...
The company is working hard to create a 'consumables' market for digital photos, as it stands to lose at least a large part of its film consumables market to digital imaging. One example of this is a network of 1,000 digital photo kiosks in 7-Eleven stores across Japan which provide prints at a cost of ¥50 (¢41) each.
Fuji says it isn't planning to create a link between its acquisition of NEC's laser printer operations or its increased (now 75%) stake in Fuji Xerox Corp. to its digital photo printing operations. Analysts however are expecting that the company will look for possible links in the future.
The company isn't expecting a drastic decline in the film business, and in fact expects emerging film markets in India and China to take up the slack created by digital elsewhere.
Fuji already gets 40%+ of its revenues from digital products.
The company has seen an almost 30% gain in its share price over the past year, whilst the Nikkei average has fallen nearly 25% in the same time...
