August 06, 2005

Photo Kiosks Spread Like ATMs

nec-12-lcd.jpgMore than 70,000 digital photo kiosks have popped up on the retail landscape in recent years, in locations ranging from McDonald's restaurants and Walt Disney Co. parks to Carnival cruise ships, drugstore and mass merchandiser chains. But 7-Eleven has pulled back on its self-service photo kiosk stations and says it is studying how to market the low-margin offering.

After returning from a family vacation in Mexico, Bobbi Logsdon wanted to print some photographs of the trip. So she went to the hospital.

There, outside the cafeteria at Millard Fillmore Suburban Hospital in Williamsville, N.Y., Ms. Logsdon found what she was looking for: a Sony Corp. PictureStation kiosk, which spits out digital photos on the spot. The 38-year-old nurse manager at the hospital inserted a memory card from her digital camera into the machine and printed 10 snapshots in just a few minutes, for 49 cents apiece. "I used to go to Wal-Mart for my photos," she says. But like so many patients and new parents and staffers, she finds the hospital option "much quicker and far more convenient."
The facility's lone digital photo kiosk is also a moneymaker, albeit a small one. Kathy Gorski, the hospital's manager of volunteer services who oversees the kiosk, says she expects the machine to bring in an extra several thousand dollars a year. The money will likely be used to improve maternity-ward services, she says.

Now popping up not just in hospitals, but also fast-food joints, cruise ships and other high-traffic spots, photo kiosks have become the newest battleground in the digital-photo printing wars. And as more players seek to grab a bigger share of the $3.5 billion annual U.S. digital photo-printing market, companies such as Sony, Eastman Kodak Co., Fuji Photo Film Co. and Pixel Magic Imaging Inc. are racing to make the kiosks nearly as ubiquitous as automated-teller machines.

Prices for the kiosks are also plunging, fostering the spread of the machines. The average list price of a photo kiosk from Lucidiom Inc. is $3,900 today, down from $5,500 last year, says Stephen Giordano, chief executive of the closely held Vienna, Va., company. Retailers typically buy the machines, and keep the revenue from prints. Some kiosk makers now also offer lease options, where retailers pay a monthly fee and share the revenue from consumers.

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Posted by keefner at August 6, 2005 04:18 PM