Fujifilm's New Dimension

[aruljothi]

More than two decades ago, Fujifilm was one of the first camera manufacturers to see the future of photography was digital. In 1988, the Japanese imaging giant developed the world's first fully digital still camera; 10 years ago Fujifilm held 30% of the digicam market. But that dominant position proved difficult to defend against competitors such as Nikon, Olympus and Canon. Today, Fujifilm is one of the industry's also-rans, with just a 6.7% market share.

There's one way to get back into the game: invent new rules. That's just what Fujifilm plans to do later this year when it unveils the world's first 3-D digital camera for consumers. The company hopes that its groundbreaking new gadget — tentatively named the FinePix Real 3D System — will allow it to leapfrog the competition by bringing 3-D capabilities to the masses, at the same time putting a little buzz back into the business of taking snapshots. (See the best inventions of 2008.)

I got a look at Fujifilm's prototype 3-D camera last month at the company's Tokyo headquarters, and was pleasantly surprised that it was not much bigger or heavier than some conventional digicams. The most obvious difference is that Fuji's 10-megapixel shooter employs two lenses, spaced about the same distance apart as human eyes, which allow for the taking of simultaneous photos of the same scene from different angles. This is where the 3-D magic originates. When two slightly different images are presented discretely to the right and left eyes of a viewer, that person's brain combines them into a single image, resulting in a stereoscopic illusion of depth. (See the Gadgets of the year.)

In the past, special viewing accessories such as 3-D glasses or stereoscopes were needed for this to work. Not so with Fujifilm's system, which offers two viewing options. One is a 3-D digital picture frame — an eight-inch (20 cm) LCD screen that directs the dual images to the left and right eyes, creating the 3-D effect. The other option is 3-D prints, which are made with a clear plastic overlay that acts as a kind of 3-D lens. Fujifilm plans to launch an online service that will make 3-D prints for consumers.

Both methods produce snapshots in which the central subjects appear to pop off the screen or print. A parlor trick? Perhaps, but Fujifilm is gambling that consumers will not only be willing to pay for such special effects, but they'll also pay extra. When the camera debuts in Japan this summer and in the U.S. and Europe in September, it will cost around $600, roughly twice the price of conventional digital cameras. The picture frame will cost several hundred dollars, too; Fuji isn't sure yet how much to charge for 3-D prints. "We know that if it's over 500 yen [$5] per photo, it probably won't sell," says Takeshi Higuchi, general manager of Fujifilm's Electronic Imaging Division.

Failure in the nascent field won't break the company. Fujifilm has other businesses such as medical imaging and motion-picture film, and only gets about 5% of its total revenue from its digital camera business. But company officials figure the bet could pay off handsomely if 3-D catches on and Fujifilm, which holds numerous patents on the technology, has a head start. Just standing still isn't a very appealing strategy. The digital-camera market is stagnating. About 128 million digicams were sold last year, and amid the recession, sales are expected to shrink this year, according to Hisashi Moriyama, senior analyst at JPMorgan Securities in Tokyo. The U.S., Europe and Japan are near market saturation with about 80% to 90% penetration, meaning as many as 9 out of 10 consumers already have digital cameras, says Moriyama.