R&D to Suffer from Kodak Cuts

R. Winn Hardin

ROCHESTER, N.Y. -- As part of a $1 billion cost-saving plan, Kodak will cut between $100 million and $150 million from its research and development budget. What that means to advanced projects such as large-area charge-coupled device development remains unclear.
Much of Kodak's $1 billion cost-saving plan remains nebulous, according to industry analysts. Spokesman Paul Allen declined to comment on how the reduction in R&D funding would affect specific projects, saying only that the company will spread the cost savings over two years.

Personnel cuts come first
More than half of the cost savings will come from eliminating 10,000 jobs, 2000 of which were announced prior to the plan's official release Nov. 8. Allen added that employee changes will take place as soon as possible to alleviate concerns among its work force.
Kodak's digital imaging division was one of the few specific areas of reduction suggested by Chief Executive Officer George M.C. Fisher during the initial announcement last month.
Allen said that Kodak plans to evaluate its position in the digital imaging market, with specific interest in the writable compact disc market -- a fiercely competitive arena where Kodak's investment has outpaced returns. Company officials declined to comment on the future of specific divisions not covered in Fisher's initial statement, including Kodak's plastic optics division.
During the past month, Kodak's stock has suffered at the expense of a 500 percent increase in debt compared with this time last year. Analysts attribute much of the debt to stock buybacks and acquisitions, combined with a drop in its stock film market share.