Sony to shutter ImageStation online photo service

Company will close second Internet business, following music store shutdown

By Eric Lai

September 17, 2007 12:00 PM ET

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Computerworld - Sony Electronics Inc. plans to start closing down its ImageStation online photofinishing service by mid-November and is encouraging existing users to switch to Shutterfly Inc.'s market-leading service.

Sony has been quietly e-mailing ImageStation members over the past week about the service's impending closure. In an online FAQ, Sony said it is giving up on ImageStation "in order to focus on the company's core businesses, products and services."

ImageStation is the second online service that Sony has decided to close in the past two months. In August, the company confirmed that it would close its Connect Music Store in the U.S. and Europe after a three-year attempt to unseat Apple Inc.'s iTunes service.

Sony's push into online photo developing was much longer-lived. The company announced ImageStation in November 1997 as a joint venture with another service, called PhotoNet. Despite being one of the earliest vendors, and its ability to steer purchasers of its digital cameras to ImageStation, Sony wasn't one of the leading players in photofinishing.

Shutterfly leads with almost one-third of the market, just ahead of Eastman Kodak Co.'s EasyShare Gallery (formerly Ofoto.com) and Hewlett-Packard Co.'s Snapfish, according to market research figures cited by Shutterfly CEO Jeffrey Housenbold in an interview with Reuters earlier this month.

However, all of those services are facing increasing competition from photo-sharing sites such as Flickr and PhotoBucket, which also let users order prints. And even in that space, there is contraction: Yahoo Inc. said last month that it would shut down its Yahoo Photos photo-sharing site in favor of the more popular Flickr, which also is owned by Yahoo.

Users will be unable to upload, share or buy photos on ImageStation after Nov. 12. They will still be able to view and download their photos until Feb. 1, after which the photos will all be deleted, Sony said. It added that paid members will be offered refunds.

Some ImageStation users have written blog postings to voice their unhappiness about the plan to shut down the service.

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