New Company Builds on Strengths of Each Partner

ROCHESTER, N.Y., and TORRANCE, Calif.--(BUSINESS WIRE)--Dec. 13, 1999--Eastman Kodak Company and Panasonic Disc Services Corporation (PDSC), a wholly-owned subsidiary of Matsushita Electric Industrial Co., Ltd., Osaka, Japan, today announced the formation of a new venture, Matsushita Media Manufacturing LLC of America, which will manufacture and supply optical media products to both parent companies.

The venture will be a specialized contract manufacturing organization. Panasonic will hold a 51% stake in the company, and Kodak will hold a 49% stake. Both parents will contribute financial as well as other assets, including intellectual property and technical expertise. In addition, Kodak also will contribute its optical disc manufacturing operations located in Youghal, Ireland, and Guadalajara, Mexico.

DVD players have become one of the fastest growing products in consumer electronics history. In the U.S. player sales are expected to exceed 3.5 million units this year, and DVD software titles now number more than 5,000. In Europe sales are expected to take off with the increased availability of entertainment software titles. Global CD-R market growth is also rapid, with projections of an increase from 1.6 billion units in 1999 to 2.9 billion units next year

"The formation of Matsushita Media Manufacturing is an exciting opportunity that will establish a leading optical media manufacturing company," said Bob Pfannkuch, President, Panasonic Disc Services Corporation. "By combining the strengths of Kodak and Panasonic, we will be able to reach a larger portion of the world market. Plus by drawing upon the in-depth technical knowledge of the two companies, we will undoubtedly develop new uses for DVD and CD-R media. We look forward to working with Kodak to expand the DVD World concept." Mr. Pfannkuch will be the president of the new company.

According to Willy Shih, president of Kodak's Digital & Applied Imaging business unit, "The establishment of Matsushita Media Manufacturing LLC of America, will create a formidable manufacturing capability in optical media for sound, video, and data recording. The new company will result in the expansion of Kodak's world-class manufacturing facilities in Guadalajara and Youghal to produce a range of new optical media products based on DVD technology."

"This exciting venture is the direct result of the commitment, skills and world-class quality that our dedicated employees have brought to this business," Shih said. "Over the last two years, in the face of adverse market conditions, our team has turned our facilities into two of the most productive in the world. We are excited about the new opportunities to work with Panasonic to develop and expand the DVD world."

About Matsushita Electric (Panasonic)

Matsushita Electric Industrial Co., Ltd., best known for its Panasonic brand products, is one of the world's leading producers of electronic and electric products for consumer business and industrial use. Panasonic Disc Services Corporation, which is based on Torrance, CA, was the first disc replication facility in the U.S. to be dedicated exclusively to the production of DVD discs. For more information on Matsushita Electric and Panasonic, visit www.panasonic.com.

About Kodak

Eastman Kodak Company is the world leader in pictures, serving both consumers and imaging professionals. Dedicated to making it easier for everyone to get and use pictures, the company manufactures and sells a wide variety of products ranging from traditional cameras, films, papers and chemistry to digital cameras, thermal and inkjet printing solutions, as well as imaging solutions for the medical industry and high-volume business applications. Visit Kodak's website at www.kodak.com.

Editor's Note: For additional information about Kodak, visit our web site on the Internet at: www.kodak.com. For additional information about Panasonic and Matsushita Electric, visit www.panasonic.com.