I have a tendency to complain bitterly about how slow summer is in the world of business news and events, but I have to admit, Amazon.com (Nasdaq: AMZN) has been a font of interesting news this summer (as well as the subject of rumors of where it's going, culled from classified ads). The latest is its new partnership with Shutterfly for photo processing -- which actually underlines the woes that have befallen another once-giant company that was a giant.
The recent news about Shutterfly, of course, is nothing new or groundbreaking compared with some other recent initiatives. Amazon certainly has its e-commerce crown down pat, providing scads of items and services both utilitarian and unexpected. (For example, Amazon's recently announced forays into short films and short stories make it much more complex than your average retailer, as it takes advantage of the myriad ways digital media matters these days.)
Digital photography has been a screaming success with consumers, with many companies trying to get into the game in different ways. Just think of Google's (Nasdaq: GOOG) acquisition of Picasa. However, Amazon's Shutterfly goes the entire distance, hoping also to compete with bricks-and-mortar companies that are providing photo processing for the digital age. Many retailers are providing digital photography services now, as you probably know from a trip to your neighborhood Wal-Mart (NYSE: WMT), Walgreen (NYSE: WAG), or CVS (NYSE: CVS).
Regardless, it's just one more service that Amazon offers on its site, making it of course one of the premium names in e-commerce and solidifying its good name as a mall-type online entity. Through Shutterfly, not only will customers be able to enhance their pictures, order prints, and share their pictures online, they will be able to custom-order photo cards, calendars, T-shirts, mugs, and a variety of other products featuring their own photographic artwork.
Meanwhile, although its agreement with Shutterfly is a new one, many of you very likely know that Amazon's Camera & Photo area has long offered digital photo processing. Therefore, the real story here very well might be the fact Amazon previously had Eastman Kodak (NYSE: EK) as a partner. Now Kodak, once the name in photography, has been replaced.
Kodak continues to struggle with its challenge to transform its business for the digital age. Indeed, Kodak's latest earnings announcement showed its continued battle to move into digital, along with faster-than-expected decay of its traditional film business. For Amazon, things are business as usual; however, it seems Amazon's switch to Shutterfly highlights Kodak's continued struggles with the new digital age of photography.
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Alyce Lomax
does not own shares of any of the companies mentioned.
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