Shutterfly Strikes Deal with Microsoft

Redwood City, Calif.-based Shutterfly Inc. Tuesday put the finishing touches on a deal with Microsoft Corp.
which will see the firm’s digital photography service incorporated with Microsoft’s new Windows XP operating system.

Shutterfly said the deal will give customers a new option for viewing, editing and ordering prints of their digital images.

“Windows XP makes working with digital images extremely simple, and we are thrilled consumers will have the opportunity to easily
access our award-winning products and photo-finishing services through this platform,” said Andy Wood, chief executive officer of

Through the agreement, Windows XP users will have access to Shutterfly’s technology through XP’s Online Print Wizard. The Shutterfly
service offering in Online Print Wizard will take users directly to a version of the Shutterfly Web site optimized for XP. Once
users complete their orders, the wizard automatically uploads the images to Shutterfly. From there, customers can order prints and
personalized photo greeting cards. Customers can also enhance their photos with editing tools like red-eye removal and crop, and
personalize them with special borders and effects.

“Throughout the development of Windows XP, Microsoft has been committed to building technology that interacts seamlessly with
industry partners to deliver an easy-to-use, compelling photo experience to our customers,” said Chris Jones, vice president of the
Windows Client Group at Microsoft. “As both technology and consumers become more sophisticated, it’s essential for companies like
Microsoft and Shutterfly to strive toward developing the best technology for the broadest use possible. Our collaboration in Windows
XP is one that will result, ultimately, in an enhanced experience for the user.”

The deal follows last month’s resolution of tension
between the software giant and Eastman Kodak Co., stemming from the way Microsoft had planned to integrate the Scanner and Camera
Wizard with XP. Kodak’s concerns received congressional attention in the form of U.S. Senator Charles Schumer (D-NY), a member of
the Senate Judiciary Committee and previously a vocal Microsoft supporter, who sent an open letter to Microsoft Chief Executive
Officer Steve Ballmer criticizing the way the operating system integrated the Scanner and Camera Wizard.

To resolve Kodak’s issues, Microsoft decided to change the presentation of choices that appear when a camera is connected to the
computer. Instead of the drop down menu initially planned, XP was changed to display a list giving users a view of a number of
third-party applications. The company also said it would clearly identify the Scanner and Camera Wizard within the dialog box as a
Microsoft digital photography function. Also, Microsoft worked with Kodak to ensure that digital camera manufacturers have a choice
to either utilize the standard Windows implementation of Picture Transfer Protocol (PTP), or provide drivers specific to their

News Around the Web