Kodak Retains Lead in U.S. Digital Cameras

By BEN DOBBIN, AP Business Writer

ROCHESTER, N.Y. Nov 10, 2005 — For the fourth straight quarter, Eastman Kodak Co. retained its lead over Japanese rivals Canon Inc. and Sony Corp. in the U.S. digital-camera market.

In the July-to-September period, digital camera shipments to domestic retailers rose nearly 13 percent to 5.6 million from 5 million a year earlier, research firm IDC of Framingham, Mass., reported Thursday.

Photography-equipment maker Kodak shipped 1.25 million digital cameras in the quarter 21 percent more than in last year’s third quarter and its market share rose to 21.3 percent from 19.8 percent, IDC said.

Canon and Sony were tied for second place, each with 1 million shipments and a 17.7 percent slice of the U.S. market. But longtime front-runner Sony, which clung to the No. 1 spot with a 20 percent share a year ago, backpedaled while Canon made up ground on its year-ago share of 16 percent.

Fuji Photo Film Co. jumped from seventh to fourth place with 483,000 shipments, an 8.6 percent share, while Olympus Corp. slipped down to a 7.1 percent share and a virtual tie for fifth with Nikon Corp. Next was Palo Alto, Calif.-based Hewlett-Packard Co. with 6.7 percent.

Worldwide, Kodak ranks third in digital camera sales behind Sony and Canon.

Kodak warned in September that a sluggish economy would likely force it to build fewer digital cameras for the end-of-year holiday season, when as much as half of all camera sales occur each year.

But IDC analyst Christopher Chute expects dealer discounts and promotions to generate around 10.5 million digital camera sales in the fourth quarter, up 15 percent from a year earlier.

Manufacturers “may not make as much money as they thought they might, but I think the shipment volumes will be there because dealers as always are willing to drive traffic no matter what’s going on,” he said, adding that the market will likely flatten out next year.

Digital cameras, a novelty item in the late 1990s, began outselling film cameras in the United States in 2003. By the end of this year, “half of American households will own at least one camera,” and the penetration rate could peak at around 62 percent in 2009, Chute said.

source – The Associated Press