onica-Minolta to quit photography market

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Can't compete in the digital era
By Tony Smith • Get more from this author
Posted in Peripherals, 19th January 2006 11:25 GMT

Konica-Minolta today revealed it is to quit photography business after

more than 103 years - with the loss of 3,700 jobs worldwide.

The company also said it will move out of the camera market - digital
and analogue - beyond the digital SLR systems and lenses it designs
for Sony under a development deal forged in July 2005.

Under a new deal with Sony, Konica-Minolta will hand over a

"portion" of its digital SLR assets, along with its own-brand digital
camera customer service operation, to Sony on 31 March. On that
date, it will also stop selling digital and film cameras of its own.

The withdrawal from the broader photography market will take longer,
KM said. It will reduce its colour film and photographic paper product
lines in stages over the next 14 months, with a view to ceasing
production entirely by 31 March 2007.

Its Minilab development system will be dropped on 31 March, when

KM's current fiscal year comes to a close. However, KM said it will
engage third-parties to ensure existing Minilab systems can continue
to be maintained.

Last year, KM's camera business lost ¥7.3bn ($62.3m) on net sales
of ¥117bn ($1.01bn). The company today said the operation will this
year contribute annual sales of ¥75bn ($650.2m), a year-on-year fall
of 35.9 per cent.

KM said the move will necessitate some job cuts, the cost of which
will be taken in the current fiscal year. Some staff will be transferred
to other firms within the group, but some 3,700 workers need to be
shed by 30 September 2007, the company warned, many through
early retirement schemes, it hopes. KM currently employs 33,000
worldwide.

KM will focus its efforts on non-consumer businesses, including

optical and display devices and medical imaging systems.

KM's move comes just a week after Nikon said it was quitting the film
camera market to focus on high-end digital SLR cameras and lenses.
In November 2005, Olympus said it too plans to focus on the digital
SLR market.