The photo industry: a changing landscape

As digital era takes hold, sector focuses on new services, supplies

	Jesse Eisenberg of New York City uses a Fuji Film digital photo kiosk at B&H Photo to print a picture from her digital camera of her 12-week old daughter Shea. While there's no hint of a falloff in the desire of Americans to freeze-frame the world around them, the overall number of images converted into prints has been slipping.
Richard Drew / AP

updated 4:18 p.m. ET May 4, 2005

ROCHESTER, N.Y. - Jesse Eisenberg came within a technological whisker of losing all her honeymoon snapshots.

The 31-year-old lawyer's digital images, stored on an online photography site, vanished while she was in the hospital this winter having her first child. She had given up all hope of retrieving them when they suddenly reappeared on her computer more than a month later.

“I can't believe we got them back!” she exclaimed. “Oh my God, I'm going to be printing all day today.”

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It's a refrain that sets the photo industry's heart racing.

As the digital revolution sidelines film, the photo industry is having to rely more heavily on high-margin services and supplies — inks, chemicals, paper — that go into making prints.

Yet the picture is not quite as it seems.

While there's no hint of a falloff in the desire of Americans to freeze-frame the world around them, the overall number of images converted into prints has been slipping since the dawn of the 21st century.

The drop-off coincided with the lightning transition to a world without film. A few years ago, there wasn't a framework in place to help digital shutterbugs print easily or cheaply.

Digital cameras are now in about 43 million homes in America, and that 40 percent penetration could reach 70 percent by 2007. The more mainstream they become, some analysts argue, the more likely that old printing habits will re-establish themselves.

“Everybody treasures memories, and what makes memories more vivid than a photograph, a print?” said Ulysses Yannas of Buckman, Buckman & Reid in New York. That impulse, he thinks, “will not fade, it's human nature.”

Bolstering Yannas' belief is a recent frenzy of acquisitions of online photo startups, which are projected to churn out 700 million prints this year, up from 400 million in 2004.

Others dismiss the notion of shoe boxes filling up to the brim again as wishful thinking.

“The pie isn't necessarily going to get any bigger,” said Frank Baillargeon, an industry consultant in Eagle, Idaho. “But the pie is going to be sliced up in many, many different ways.

“In the digital era, you can see your pictures immediately, share them instantaneously, store them in a variety of arguably safe ways and print them selectively. My children's generation is so comfortable with technology that the need to just have a print in your hand or in a shoe box doesn't sound like a very compelling proposition.”

Manufacturers like Eastman Kodak Co., however, think the meteoric rise of camera phones could turn the lucrative print business into a growth market again, possibly within two years.

CONTINUED : Pushing prints

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