Kodak joins with AT&T and Cisco to offer digital imaging networks

April 19, 2000

Film vendor pursues services nicheEastman Kodak is venturing out of its traditional role as a provider of film, imaging systems and software and diagnostic workstations into the world of networking

Film vendor pursues services niche

Eastman Kodak is venturing out of its traditional role as a provider of film, imaging systems and software and diagnostic workstations into the world of networking services. Through a joint venture with AT&T and Cisco, Kodak’s Health Imaging Division in Rochester, NY, will now offer turnkey networking packages that combine its imaging systems with AT&T communication services and Cisco connectivity capabilities.

Kodak will take responsibility for all products—imaging components, network infrastructure, network links—and will act as the single point of contact in this alliance, according to Jim Keese, Kodak’s director of worldwide professional services.

“Any customer that procures an imaging system from Kodak now has the opportunity to include network infrastructure and external telecom links,” he said.

Kodak has been working with Cisco for about two years and has negotiated telecom service contracts for several of its healthcare customers, according to Keese. In forming this agreement with AT&T, its own communications provider, Kodak hopes to lock in larger discounts for its customers by using its clout as an AT&T customer and to capitalize on the AT&T brand name. The AT&T products that Kodak will bundle with its equipment include AT&T Managed Internet Service, Virtual Private Network (VPN) Offer Portfolio, and Business Dial Service.

The Kodak/AT&T alliance ultimately benefits AT&T by adding incremental value to the AT&T global network by having more and more endpoints installed, according to Ernie Sampera, director of new channel development for AT&T. AT&T has begun extending its business through more channel partnerships and taking the majority of its products onto the Internet platform, he added.

“This type of marketing alliance is ideal for AT&T because Kodak is assuming the risk of developing new business and of moving AT&T products into vertical markets like healthcare,” Sampera said.

If Kodak is successful, AT&T will increase revenue and network presence with almost no added sales or marketing expense.

The alliances also solve a problem for Kodak. Complaints revealed that some customer networks were not robust enough to handle the company’s imaging systems. Cisco components and upgraded links solved the problem.

Kodak initially plans to offer bundled systems for local area networks, which will run between $10,000 and $30,000 for a tier-one system (six to 20 connections), and then to move into the wide area network arena with its distributed medical imaging systems. Kodak will market these systems in the U.S., Canada, Europe, and North Africa. Depending on the success of this venture, the next level will likely involve creating virtual private networks across public networks and moving into home healthcare, initially with its telehealth product.

Kodak will also have the opportunity to further market AT&T products as they are developed. Even though AT&T is spinning off its wireless division, Kodak could possibly work with the AT&T wireless subsidiary under its agreement with AT&T to develop digital wireless networking as wireless technology advances towards DICOM compliance.

Unlike many medical device vendors these days, Keese said Kodak is shying away from the application service provider (ASP) model. However, Keese does foresee Kodak developing a PACS or archiving system using the ASP or a next-generation method as standards are put into place that satisfy security and imaging quality concerns.

© 2000 Miller Freeman, Inc., a United News & Media company.