Kodak to Buy Santa Monica Software Firm

Interactive Systems of Santa Monica has agreed to be acquired by Eastman Kodak, giving up its independence in hopes of surviving a new round of aggressive competition in the marketplace for computer operating systems and other software.

The privately held firm, a leading supplier of Unix operating system software and related programs, would become a wholly owned subsidiary of Kodak. Interactive will supply the computer guidance system for such Kodak products as copiers and printers and be an important cog in Kodak’s growing software business, according to officials of the two companies.

The acquisition price was not announced.

For Interactive, which has 173 employees, including 112 in Santa Monica, the transaction is expected to provide the capital and marketing strength needed to compete in the expanding market for Unix products, according to John P. White, Interactive’s chief executive. No jobs will be eliminated because of the deal, he said.

‘Strategic Alliances’

Unix has grown in popularity because it can work in computers of various sizes and makes. But suppliers of Unix products, such as Interactive, are facing a challenge from the recently introduced OS/2 operating system in the newest IBM personal computers, which will be almost as flexible, analysts say.

The result has been a number of strategic alliances, of which Kodak’s planned purchase of Interactive is only the latest. Motorola recently purchased a minority interest in Unisoft, another maker of Unix products, and American Telephone & Telegraph and Unisys have entered into alliances with Sun Microsystems.

“It sounds to me like the Unix people are entrenching themselves more deeply than ever before to face that onslaught,” said Andrew Seybold, editor of a computer industry newsletter in Santa Clara.

Interactive will continue to serve its existing customers--which, in the complex intertwinings characteristic of the computer industry, have included AT&T; and IBM.

Seybold said the acquisition by Kodak also may signal the Rochester, N.Y.-based company’s long-term interest in developing more sophisticated computer peripheral devices.