Kodak licenses projector patents to IMAX to stay afloat

Oct 17, 2011
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Kodak licenses projector patents to IMAX to stay afloat

Eastman Kodak has not handled the transition to digital photography as gracefully as its competitors, but when your company's over a century old, staying nimble isn't as easy as it used to be. Of course, a company with that much history has an overabundance of intellectual property, and that fact might help Kodak stay relevant in a market that has been outpacing it for several years. Kodak has announced a deal with IMAX to license its laser projection patents to the movie company, allowing it to more effectively project digital films on its gigantic screens.

For Kodak, it means some much-needed cash to the tune of $10 million, plus undetermined royalty payments for at least ten years. That's an important chunk of change for a company whose stock has lost three fourths of its value in the last year - shares were up an eyebrow-raising five percent on the news. The licensing deal is part of a $250-350 million plan for the company to pay off its considerable debt.

On IMAX's part, the new technology will allow it to replace older digital and analog projectors in more of its theaters. IMAX's equipment is specialized and extremely expensive, so when they upgrade, they intend for it to last. In addition to generally high-quality digital projections, IMAX films using the new patented process will be considerably brighter than their older counterparts. The new projection system is also much more cost-effective, and even for a company that isn't on the verge of bankruptcy, every penny counts.

This raises an interesting proposition for Kodak, the vanguard of film photography and videography: will the company, now entering its thirteenth decade, become a firm principally composed of its ideas and techniques? With digital competitors like Canon, Nikon, Sony and the rest outpacing them in just about every market except budget point-and-shoots, it might not be bad way for them to continue.


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