After spending untold hundreds of millions of dollars on creating a whole new line of business in desktop inkjet printers, Eastman Kodak Co. is pulling the plug on the printers themselves.
The struggling printing and imaging company on Friday said that it would shift its focus in 2013 on ink sales to the printers it has already sold and end selling the printers themselves. The company has long talked about the profits in its desktop inkjet printers being in the consumables, such as the ink, and according to the company getting out of the printer business itself “will significantly improve cash flow in the U.S. beginning in the first half of 2013.”
The inks used in Kodak’s desktop inkjet printers are manufactured at Eastman Business Park.
The shut down of the printer line points to a major and abrupt shift in Kodak’s business plans. In recent years, Kodak has continually pointed to desktop inkjet printing — along with commercial printing, packaging printing and printer workflow software — as the four legs that would be its foundation in a post-film, digital world. As recently as August, Kodak plans after bankruptcy included desktop inkjet printing as one of its anchors.
But Kodak’s move comes as the desktop printer market overall has been suffering from slipping sales.
Along with the announcement about the printer business change, Kodak said Friday it was asking U.S. Bankruptcy Court for more time to put together a Chapter 11 bankruptcy reorganization plan. Such plans — which ultimately have to be approved by the federal bankruptcy court — spell out how a bankrupt company will operate after bankruptcy and what steps it will take to make its creditors as whole as possible.
According to Kodak, it is seeking a Feb. 28 deadline. That raises the likelihood that Kodak’s much-repeated intention to get out of Chapter 11 early in 2013 won’t happen and that such an emergence — if it happens — would come sometime in the second or third quarter of the year.
Since filing for Chapter 11 bankruptcy protection in January, Kodak has made a number of huge sweeping changes to its business to raise money and cut costs, from shutting down its digital camera business and selling such operations as its online Kodak Gallery. The company currently has a variety of other business lines up for sale, including document scanners and still camera film. It has laid off 2,700 people worldwide so far this year, and said Friday it plans to lay off another 1,200 — 200 more than previously announced.
And, Kodak said Friday, it is in negotiations to find “a fair, equitable and permanent resolution of Kodak’s U.S. retiree benefit liability, which amounts to approximately $1.2 billion.”
- Kodak to quit making its desktop inkjet printers; 200 more to lose jobs (democratandchronicle.com)