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HP Charges Into Retail Photo Printing Market

Posted by iMark - 2006-02-28

Hewlett-Packard Co. Wednesday announced its entry into the $35 billion retail-photo-printing market, introducing a self-service photo kiosk and an in-store photo studio that will initially installed in Albertsons Inc. supermarkets and Longs Drug Stores.

HP, already the world's largest maker of computer printers and a leader in digital photo printers, already is strong in home printing of digital photographs and in online photo printing, with its Snapfish acquisition. Now, it hopes to complete the cycle by moving into retail photo printing.

It would be the first inkjet technology introduced into the kiosk market, aiming to take share from the more traditional dye-sublimination printing process used in photo printing kiosks, HP said. HP is targeting its HP Photosmart Studio, which also uses inkjet technology, at would-be competitors such as Fuji Photo Film Co. Ltd. and Eastman Kodak.

HP ultimately hopes that the kiosks, which are easy to use with a touch-screen and can produce 4 by 6-inch prints in as little as five seconds, will spread to hotel lobbies, cafes, airports and hotel lobbies, said Vyomesh Joshi, head of HP's imaging and printing business, in an interview.

"We really want to capture a lot of prints in retail," Joshi said, adding that HP "can really help (retailers) make money" because of higher margins on inkjet prints than in traditionally used photo printing processes.

But it won't be easy, particularly in the kiosk market, one analyst said, because of the long-established relationships that retailers have with Fuji and Kodak, among others.

"HP is not really known as a photo printing provider" among retailer, said Ron Glaz, an analyst at market research firm IDC, who tracks the digital imaging market. "They're going to have to develop these new relationships and that doesn't happen overnight."

The HP Photosmart Express kiosk works with HP's Snapfish online digital photo service so customers could upload photos at home, place an order online, for example, and then use the kiosk to retrieve them from Snapfish and print them, HP said.

The Photosmart Studio also lets customers have retailer employees do more than just make 4 by 6 or 5 by 7-inch prints. The HP product can take from one to 200 images into albums, calendars, CDs, greeting cards and posters in less than an hour, HP said.

The photos are laid out in minutes using proprietary image management software developed by HP labs, replacing the need to select, crop or place manually photos into templates on individual pages, the Palo Alto, California-based company said.

"HP, by getting into the retail business, they are basically closing a loop, Glaz said. "Now they can generate revenue from home printing, online printing and, now, retail printing."



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