Kodak set for gamble on re-entry to japan

Japan’s digital camera market is a brutal battleground where even some of the country’s leading manufacturers are finding it difficult to survive.

In spite of buoyant demand, many Japanese manufacturers are struggling to make profits in the face of the double-digit price declines due to the large number of competing suppliers.

So it came as something of a surprise that Kodak, which has never had an easy time in the Japanese market, decided last month to enter the fray.

The US group quietly launched two new cameras and its proprietary digital printing system for the Japanese market.

The products represent the second attempt at cracking the Japanese consumer market for digital cameras – Kodak was forced to pull out about two years ago due to a lack of demand for products that appeared to cater more to US than Japanese tastes.

Kodak’s latest move is a big gamble in a market that has eluded and frustrated the US group for decades – at one point it even took Japan to the World Trade Organisation over alleged unfair practices.

But Kodak’s re-entry is not just about overcoming a difficult marketplace – it is central to its strategy of strengthening its digital photography business.

Kodak needs to be in the Japanese digital camera market because that is where trends in the global market are set, according to Yusuke Koijma, president of Kodak Japan.

The importance of the Japanese market in setting the standard for consumer-use digital cameras means that taking on the Japanese market is critical to Kodak’s success in shifting its focus to digital photography, Mr Koijma believes.

This is not only due to Japanese digital camera makers’ continued technological advances, such as a reduction in camera sizes and improvements in picture quality. It is also because the product cycle is so much faster in Japan than elsewhere. Any company wanting to compete with Japanese camera makers in other markets needs to be able to respond just as quickly as they do to changes in market trends, Mr Koijma says.

Mr Koijma, who was lured to Kodak in April last year to bolster its digital photography business, should know how tough the competition is. He spent 36 years at Japanese camera maker Olympus, where he was credited with building its key digital business from scratch.

Once at Kodak, Mr Koijma quickly relocated the company’s global development center for digital cameras to Japan. The US group acquired the 41 per cent of Chinon, a Japanese digital camera maker.

As a late-comer in a market where prices are plummeting, Kodak will be hard-pressed to generate satisfactory profits with its cameras alone.

The group is in the midst of a far-reaching programme to restructure its operations worldwide, including the shift to digital photography, so it is taking a cautious approach over the fiercely competitive Japanese market.

“In Japan, there is a chance for everyone – but it is a huge challenge to continue winning,” says Mr Koijma, noting that Bic Camera, a major local retailer, carries the products of about 30 digital camera makers.

For Kodak, even winning a foothold in such a forbidding market would be a sweet victory.

The Financial Times, December 15, 2004

ACTIVE VOCABULARY

1. to re-enter the market – осуществить повторный выход на рынок

2. buoyant – активный, оживленный, повышательный

3. to launch – внедрять, выпускать, представлять (на рынок)

4. product cycle – жизненный цикл товара

5. to build from scratch – создать «с нуля», с нулевого уровня, заново

6. to cater sb’s tastes –удовлетворять чьим-то вкусам

7. to allege – утверждать (особ. безосновательно)

8. unfair practices –нечестные методы, действия, методы недобросовестной конкуренции

9. foothold – плацдарм, опорный пункт

to gain/to win a foothold –утвердиться, укрепиться

Suggest the English for the following word combinations.

пользоваться активным спросом, представить новый товар на рынок, быть вынужденным уйти с рынка, методы недобросовестной конкуренции, определять основные тенденции на рынке, жизненный цикл товара, жесткая конкуренция, приносить прибыль, создать предприятие заново («с нуля»), завоевать позиции на рынке (закрепиться)