Kodak and Lexar Join Forces In Drive For Removable Digital Memory Market Leadership
Business Editors
ROCHESTER, N.Y. & FREMONT, Calif.--(BUSINESS WIRE)--May 17, 2004
Eastman Kodak Company (NYSE: EK) and Lexar Media, Inc. (Nasdaq: LEXR) today announced they have formed a long-term agreement to gain a larger share of the market for removable digital memory products, driven by surging demand from the mass-market adoption of digital cameras, mobile phone cameras, portable music players and other consumer electronics devices.
As part of the exclusive multi-year agreement, Lexar Media will manufacture and distribute a full range of KODAK branded memory cards and will work with Kodak to provide consumers with a wide variety of reliable, high quality, mass-market memory cards worldwide. Kodak will contribute to the partnership its brand power and global distribution network, while Lexar Media will contribute removable memory products known for their quality, reliability and speed, and its demonstrated retail category management. Both companies will market the products worldwide.
"This agreement is ideal for both parties," said Bernard Masson, president, Digital & Film Imaging Systems, and senior vice president, Eastman Kodak Company. "For Kodak, it represents another step in our effort to accelerate the growth of our digital businesses by providing customers and our retail partners a full suite of KODAK branded memory cards that will work with virtually any product and system. Lexar will benefit from Kodak's worldwide brand presence and massive global distribution network."
"We recognize the power of the KODAK brand across photography and imaging fields and we are pleased that they have selected Lexar to help drive the KODAK brand into this fast-growing category," said Eric Stang, chairman, president and CEO, Lexar Media, Inc. "Lexar's superior controller technology and retail focus combined with Kodak's brand strength and worldwide distribution network will enable us to deliver memory cards with the quality and performance that consumers have come to expect from Kodak."
With this agreement Lexar and Kodak will develop strategies for each segment of the memory card market and drive the KODAK branded memory cards into a broad range of channels worldwide. According to IDC, worldwide digital camera sales are expected to top 68 million units in 2004, a 39% growth over 2003, and grow to over 87 million units in 2007. In addition, worldwide camera phone unit shipments are expected to reach 186 million in 2004 and grow to more than 422 million units in 2007. This year alone, digital camera sales will drive retail sales of more than 100 million memory cards with an expected retail sales value of over $4 billion.
"With the rapid and consistent adoption of digital technology in cameras and cell phones and with ever increasing resolutions, we expect digital memory cards to become one of the primary storage devices for most consumers worldwide," said Chris Chute, senior analyst for Worldwide Digital Imaging Program of IDC.
Consumers can expect to see a full suite of KODAK branded memory cards on store shelves in the fourth quarter of 2004. The product line-up will include Secure Digital (SD), Mini-SD, Multimedia Cards (MMC), CompactFlash(TM), and additional media formats will be offered in the future. The companies did not disclose the financial terms of the agreement.
About Eastman Kodak Company and infoimaging
Kodak is the leader in helping people take, share, print and view images - for memories, for information, for entertainment. The company is a major participant in infoimaging, a $385 billion industry composed of devices (digital cameras and flat-panel displays), infrastructure (online networks and delivery systems for images) and services & media (software, film and paper enabling people to access, analyze and print images). With sales of $13.3 billion in 2003, the company comprises several businesses: Health, supplying the healthcare industry with traditional and digital image capture and output products and services; Graphic Communications Group, offering on-demand color printing and networking publishing systems consisting of three wholly owned subsidiaries: Encad, Inc., NexPress Solutions, and Kodak Versamark; Commercial Imaging, offering image capture, output and storage products and services to businesses and government; Display & Components, which designs and manufactures state-of-the-art organic light-emitting diode displays as well as other specialty materials, and delivers optics and imaging sensors to original equipment manufacturers; and Digital & Film Imaging Systems, providing consumers, professionals and cinematographers with digital and traditional products and services. For more information visit www.kodak.com.
About Lexar Media, Inc.
Lexar Media is a leading marketer and manufacturer of flash memory cards, USB flash drives, card readers and ATA controller technology for the digital photography, consumer electronics, industrial and communications markets. The company holds over 70 controller and system patents, and licenses its technology to companies including Olympus, Samsung Electronics, SanDisk Corporation and Sony. For more information, please call 1-800-789-9418 or visit www.lexarmedia.com.
