Polaroid Not Yet A Pretty Picture

INSTANT PHOTOGRAPHY

POLAROID Corporation has given the public a snapshot of its strategy ``to achieve what we do not have at the present moment, sustained growth,'' as Sheldon Buckler, executive vice president of the troubled company, put it. But analysts are watching how it develops before calling it a pretty picture. ``I've taken more of a prove-it-to-me attitude,'' says Eugene Glazer, technology analyst at Dean Witter Reynolds. ``It remains to be seen if these programs can stimulate what has been a declining industry.''

Demand for all picture-taking continues to grow about 5 percent annually, Mr. Glazer says, but the trend in instant photography, Polaroid's specialty, has been flat or down.

Both price and quality are factors. Conventional photography has made great strides in ease and results, raising public expectations, Glazer says. Polaroid's instant photography hasn't kept up. Instant photos are ``very, very expensive'' next to conventional - and will remain so - because making the film is much more labor-intensive, he says.

On the positive side, the Cambridge, Mass.-based firm survived a takeover attempt last year. It cut costs, eliminating 1,700 jobs, or 15 percent of the company's work force, through voluntary severance and early retirement. And it awaits a patent infringement award against Kodak that could reach several billion dollars.

As for the future, ``high quality, instantly available hard copy'' will remain at the core of Polaroid's strategy. ``The great technical streams of photochemistry, electronics, and computer science are converging,'' Mr. Buckler said at this month's annual meeting, held at Wellesley College.

``In the decades to come, imaging will play an ever more dominant role in our lives as more of our thoughts, education, communication, and understanding comes in the form of images rather than words. We intend to have our special place in that world,'' he said.

Glazer, who sat in the front row for Buckler's presentation, wasn't impressed. ``I didn't see anything new,'' he says. On the contrary, Polaroid is ``at least several months behind'' on a number of products and marketing efforts, which he found ``a little bit disturbing.''

Prudential-Bache Securities analyst Alex Henderson also had a front-row seat. ``The problem from Wall Street's point of view is that a year later, they're still talking about it. Nothing has happened,'' he says.

Hybrid IV, an improved film, won't be available to the 23 million owners of Polaroid instant cameras until 1991. ``Joshua,'' a pocket camera under development, won't be mass-marketed until 1992. ``Right. So who cares?'' Henderson says.

For competitive reasons Polaroid won't reveal what Joshua's ``very exciting'' features will be. Based on what Polaroid has told them, Henderson and Glazer are divided on the camera's potential. ``I'm personally of the opinion that Joshua is a crazy idea,'' Henderson says. ``One assumes that the photos will be the size of a business card. Let's face it, there's just not a huge market for that.''

Glazer says that Polaroid has been working to make possible high-quality enlargements from its instant photos. ``If you could give me that, that would be an attractive product.''

Both analysts say that the company's attempts to demonstrate practical uses for instant photography are critical for its future growth. Glazer talks about the broad effort across home, business, and school, while Henderson emphasizes the ``Polaroid Spoken Here'' concept for retail establishments.

Developed a year ago, that idea would put Polaroid cameras where customers might find them useful: home-improvement centers, eyeglass stores, restaurants.

``I think it is a very reasonable thing,'' Henderson says.

KARL YANKOWSKI, vice president of Polaroid's business imaging group, says that the company will put together a full-blown marketing program for ``Polaroid Spoken Here'' in the second half of the year.

On the education side, he says that one elementary or middle-school teacher in 10 in the United States uses a Polaroid camera as a teaching aid. Polaroid is looking for 25 percent growth per year for five years in the educational market, he says.

To encourage this, the company drafts experts to develop curricula that have instant cameras as an integral element, such as time-lapse photos of a leaf unfolding for biology class.