Polaroid to Exit Instant Film as Demand Goes Digital
By Courtney Dentch
Feb. 8 (Bloomberg) -- Polaroid Corp., the company that pioneered instant photography, is exiting the film business and closing plants in the U.S., Mexico and the Netherlands as it focuses on digital photography and flat-panel televisions.
Polaroid, founded by Harvard University dropout Edwin Land in 1937 and bought out by Petters Group Worldwide three years ago, will make enough instant film to last into 2009. It plans to license the technology to third-party companies for diehard customers. Polaroid stopped making instant cameras for commercial use in 2006 and halted production of consumer models last year.
``We're trying to help what have been extremely loyal Polaroid customers to make our film categories last as long as we can,'' Tom Beaudoin, chief operating officer of the Concord, Massachusetts- based company, said in an interview today. ``The most popular film is the one everyone recognizes. It's the 600 series with the white border that you see in advertisements. It's become an icon.''
Polaroid made protective glasses and goggles for the U.S. military during World War II and sold the first instant camera in 1948, raking in $5 million in sales in the first year, according to the company's Web site.
Land, who left Harvard just months before graduation in 1932 to establish the company, held more U.S. patents than anyone except Thomas Edison, including one for the first synthetic polarizer. Land kept Polaroid innovative with inventions such as 3-D film.
`Swinger'
Polaroid introduced the $20 Swinger in 1965 and in 1972 Sir Laurence Olivier became the spokesman for the SX-70 camera in a series of TV and radio ads. During the late 1970s, the Polaroid OneStep camera was the best-selling camera of any type.
In the 1960s and early 1970s, the stock was among a group of companies known as the ``Nifty 50'' for their consistent growth records, continual dividend raises and high price-to- earnings ratios.
Polaroid will close large-format film facilities in Norwood and Waltham, Massachusetts, and cut 150 jobs by the end of the quarter, Beaudoin said. A professional-grade film factory in Mexico and a site in the Netherlands that makes consumer film packs also are slated to close this year, slashing about 300 jobs, Beaudoin said. The story was first reported in the Boston Globe today.
Last month, Polaroid unveiled a line of Zink printers that can develop wallet-sized photos from digital cameras in 60 seconds. The company plans to roll out larger-format printers in coming years, Beaudoin said. Polaroid also makes DVD players, TVs and other electronics, which brings in about $1 billion in annual sales, he said.
Sales Decline
``Our main product line was in a technologically driven decline,'' Beaudoin said. ``The Zink printers will complete the transformation from analog instant to digital instant.''
The company filed for bankruptcy in October 2001 after losing money for three straight quarters as customers moved to digital cameras. Sales fell from a peak of $2.3 billion in 1994 to $752.7 million in 2003 amid increased demand for digital cameras.
JPMorgan Chase & Co.'s private equity unit, One Equity Partners LLC, in 2002 purchased a 53 percent stake in then- bankrupt Polaroid for $56 million. Closely held Petters began licensing Polaroid's consumer electronic products in 2002 and bought the company in 2005 for $426 million.
To contact the reporter on this story: Courtney Dentch in New York at cdentch1@bloomberg.net .
Last Updated: February 8, 2008 17:02 EST
bloomberg.com |
