In a move which will be of no surprise to many Hewlett Packard has outlined plans for the future of its digital camera business, announcing that it is to licence an OEM partner to design, source and distribute HP-branded cameras. This shift in strategy is intended to allow the technology giant to concentrate on developing its Print 2.0 initiatives, strengthening its position in the home and commercial printing markets. The current range of cameras is expected to remain on sale for the remainder of this year with the new partnership deal to follow in the early part of 2008.

Press release:

HP to Seek New Business Model for HP-branded Cameras

PALO ALTO, Calif., Nov. 7, 2007 - HP today announced that it will seek an alternative business model for its HP-branded cameras and shift resources toward its Print 2.0 growth initiatives.

HP is currently working to identify an original equipment manufacturer (OEM) partner that would be licensed to design, source and distribute digital cameras under the HP brand. HP will continue selling its own cameras through the holiday season and intends to have the partnership arrangement in place in the first half of 2008.

This shift in strategy is intended to enable HP to accelerate its investment in Print 2.0 initiatives. These include furthering HP's leadership position in home photo printing and online photo services, while accelerating the company's retail photo-finishing business.

Announced in May 2007, the company's Print 2.0 strategy focuses on three areas: delivering a next-generation digital printing platform that increases print speeds and lowers the cost of printing for high-volume commercial markets; making it easier to print from the web; and, extending HP's digital content creation and publishing platforms across all customer segments.

As a result of its new camera business strategy, HP will take a pre-tax charge of approximately $30 million in the fourth fiscal quarter ending Oct. 31, 2007.