Hero no more: Kodak to exit the inkjet printer market

posted Monday, October 1, 2012 at 5:41 PM EDT

A little over a month ago, we reported on Kodak's plan to divest itself of its film and imaging businesses, after having previously exited the digital camera, camcorder, and picture frame markets, shuttered its image sharing service, and sold its image sensor business. Now, Kodak has announced its exit from yet another area of the market--but this time it's one in which the company was until recently suggesting it was seeing strong growth.

Starting next year, Kodak will apparently stop sales of its consumer inkjet printers. Currently, there are a total of nine all-in-one printer models on offer from the company, across the HERO and ESP printer lines. The most recent of these, the KODAK ESP 3.2 All-in-One, was launched last May.

Putting a brave face on the news, Kodak suggested that it will refocus its Consumer Inkjet business on selling ink to existing owners of its printers, but that is clearly not a long-term strategy. With no new models shipping, the installed base of Kodak inkjet printers will dwindle over time. That will inevitably leave Kodak with little option but to halt ink sales as well. The only alternatives would be to relaunch itself in the inkjet business, or to attempt an entry into the market for third-party ink refills, neither of which seems likely. At least the news does mean that owners of Kodak inkjets will be able to continue to obtain supplies for their device for the time being, however, something that will be key to Kodak's ability to clear out its existing printer inventories.

The announcement effectively brings to an end Kodak's participation in the consumer market, with only a business-to-business presence remaining. As we've already noted, Kodak no longer sells cameras, camcorders, and picture frames, and a quick look at the Kodak Store suggests that its few remaining accessories are all being sold at a deep discount as well. The company's retail kiosks and the like come under the aegis of the Personalized Imaging business, which the company is working to sell, and one would presume that its app development--which exists primarily to service the kiosks and printers--will likely also halt without the company's involvement in those areas.

Kodak's OFFICE HERO 6.1 AIO printer. From 2013, Kodak won't sell consumer inkjet printers.

While sad, the news is hardly surprising, as pointed out by the Democrat and Chronicle newspaper in Kodak's hometown of Rochester, New York. Early in the bankruptcy process, the company seemed to believe that an auction of its intellectual property would provide the funds necessary for its reinvention as a viable entity. Response from potential buyers was unenthusiastic, with the Wall Street Journal reporting that bids barely surpassed 20% of Kodak's expected sale price. The last news on that front from Reuters suggested that the company had simply given up on selling the patents, and was instead considering setting up a company through which it would seek out licensees, using the funds thus generated to help repay its creditors.

As sad as all of this is for those who remember Kodak's long history as a pioneer in the market, the news is worse still for another 200 Kodak employees who now find themselves included in an expanded layoff plan, bringing Kodak's total workforce down to just 13,100 employees.