Corel Corp. got clobbered several years ago when it tried to beat Microsoft Corp. in the PC software market. Today, after being revamped top to bottom and recently relisted as a public company, Corel faces an equally formidable competitor: Google Inc.
Google has developed a competing portfolio of graphics, digital imaging and productivity software. Not only does the Internet search giant have a much more powerful brand than Corel, but its business model is tough to beat. Google gives its software away free over the Web.
Once one of Canada's best-known technology companies, Corel was never able to compete effectively against Microsoft's Windows franchise that still dominates the personal computer industry today. But the Ottawa company thinks it has found a way to prosper against Google and other companies offering free Web-based services that are increasingly supported by ads.
On Tuesday, Corel will launch new software for managing digital photos and video. It will give away one version of Snapfire, which lets users organize, edit and share their images, and sell a premium version called Snapfire Plus for $40 (U.S.) with more advanced editing features.
Plenty of other companies already offer free image software. Google's Picasa software for the PC is one of the most popular tools for organizing and sharing pictures. In June, Yahoo Inc. launched Yahoo! Photos, which lets users store images on Yahoo servers, share them with friends and order prints on-line.
Hewlett-Packard Co. also has an on-line storage and printing site called Snapfish. And Eastman Kodak Co. operates its EasyShare Gallery, which lets users store images and order prints off the Web.
What's different about Snapfire is its modular component that lets people purchase additional pieces of software to customize their photo storage and editing tools, Blaine Mathieu, general manager of Corel's digital imaging business unit, said in a phone interview from Corel offices in Minneapolis.
Snapfire doesn't lock customers into a propriety system, like Kodak's EasyShare, and is simpler to use than Google's Picasa, he adds.
“We are very confident that we have a competitive product against the Microsofts and Googles of the world.”
According to an on-line survey of more than 700 individuals done by the company this year, 55 per cent of respondents found the task of organizing and managing digital photos “overwhelming and confusing.”
“In many cases they feel like they are losing control of their memories — who controls what, who sees what, and what gets backed up,” Mr. Mathieu said.
Corel, which already has about 40 million customers using its PC software, is betting that people will get hooked on free starter versions of its digital imaging software and then pay to personalize and enrich it. It has found limited success from this “upsell” strategy with other products, including WordPerfect, WinZip and Paint Shop.
The first component piece that will be available for Snapfire Plus will let customers copy slideshows to a DVD and play them back on a television DVD player. That product will sell for $10 later this year. Corel expects to add a wide variety of features from third parties in the future, Mr. Mathieu said.
The company announced its new digital imaging platform earlier this summer after working on it for three years. Corel aims to eventually have “many million” Snapfire customers but it doesn't expect any material gains from Snapfire until after fiscal 2007.
The move fits within chief executive officer David Dobson's strategy of positioning Corel as the low-cost alternative to the software giants, and competing in the industry without going head to head with its biggest players.
Last week, the company announced plans to round out its multimedia product lineup with a $196-million agreement to buy InterVideo Inc. The Fremont, Calif., company's software is used to play, record and edit video on DVDs.
