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Sony files suite against Kodak in US over digital camera patents

Sony Corp, the biggest seller of digital cameras in the US, sued Eastman Kodak Co over alleged use of patented camera technology, as competition in the US$11.6 billion global digital market intensifies.

Kodak, the world's biggest photography company, last month brought claims against Tokyo-based Sony in Rochester, New York, saying Sony Electronics infringed 10 patents issued between 1987 and last year, including ones for image compression and storage in digital cameras.

"It's customized chips and components that differentiate products from the pack, so you're probably going to see more lawsuits in the future," said John Yang, an analyst at Standard & Poor's in Tokyo.

The suit brought by Sony, maker of Cyber-shot digital cameras, is the company's first concerning digital still camera technology. It comes as competition from rivals such as Kodak and Fuji Photo Film Co erodes profit and sales of Japanese-made cameras in North America fall.

The move against Kodak concerns technology related to the camera's electronic shutter, multiple exposure speeds and indicators displaying the number of pictures taken and number still available, said Aki Shimazu, a spokeswoman for Sony in Tokyo.

"It's not a counter suit," against Kodak, she said. "This action is over completely different technology."

Sony is releasing about 10 new models a year to sustain profit margins as customers demand smaller, cheaper units and sharper pictures.

Digital cameras have a profit margin of about 15 percent, analysts said.

Last year Sony had a 21.7 percent share of point and shoot digital camera shipments in the U.S, according to market researcher IDC.

Kodak overtook Olympus to become the second-biggest supplier with 17.9 percent of the market.

Shipments of Sony's digital cameras will rise by as much as half during the business year ending March 31, 2005, from about 10 million estimated for the year that ended on Wednesday, Shimazu said.

In January, sales of Japanese-made cameras in North America fell 1.8 percent as shipments rose 12 percent, the Tokyo-based Camera and Imaging Products Association (CIPA) said in a report earlier this month.

Worldwide digital camera shipments by Japanese makers will surge 40 percent to 60.9 million units this year compared with last year, CIPA said in a report in January.
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