Kodak Axes Digicams, but keeps film

[David A. Goldfarb]

In New York, where there's a critical mass of media industry, and photography to support the media industry, there are labs to support film and digital--fewer than there used to be, but enough to meet demand certainly. Of course we all know that print and internet need digital files these days, so more and more is digital, but at the high end, if a photographer's vision is best achieved with film, the dip-and-dunk lines are still running, and we've still got 4-hour turnaround on E-6 without a rush order, and if it's the kind of job where it is more expensive to pay the models and assistants to wait on set than to rush the film, rush and double rush are still available, and labs will work with major clients who shoot film to make things work for them.

I don't know how this plays out in other cities, but I suspect we're just seeing concentration of media photography anyway in major cities like New York, Los Angeles, and Chicago, because that's where the rest of the industry is, and film is a viable commercial medium in those places where there are businesses that can afford the luxury of film. In a high-circulation slick fashion magazine where a full page can cost more than $100,000 just for the ad space, the cost of film and processing and whatever one needs to do to achieve the desired level of "convenience" is insignificant.

 

[DREW WILEY]

Steel is gradually coming back, Ron. People are starting to figure out that it is way more expensive to ship scrap more than the circumference of the
earth to get dubious quality and spot outages. But it never was a miscalculation to outsource it. Rather, there was an oligarchy of about twelve very wealthy businessmen who controlled the scrap steel commodity. They made huge sums of money monopolizing its trade and
by shuffling it back and forth. Stainless is a more specialized material and
a lot of what is imported is only marginally worthy to be called stainless.
Economical "stainless" sinks will sometimes rust within half an hour with
lemon juice or ketchup on it - not even 18-8, let alone 303 or 316. But
you'd be amazed how fast someone's temper can flare when they realize
they're sitting on a couple of acres or a few million dollars worth of outsourced rebar that won't pass inspection. The smart-alecs only rule
the roost for awhile.

 

[clayne]

You have got to be kidding me...

Actually. To give benefit of the doubt to Aristophanes, I believe what he meant with the Ilford comment is that one shouldn't want them to survive ONLY because they're the last man standing. That I can agree with.

 

[CGW]

In New York, where there's a critical mass of media industry, and photography to support the media industry, there are labs to support film and digital--fewer than there used to be, but enough to meet demand certainly. Of course we all know that print and internet need digital files these days, so more and more is digital, but at the high end, if a photographer's vision is best achieved with film, the dip-and-dunk lines are still running, and we've still got 4-hour turnaround on E-6 without a rush order, and if it's the kind of job where it is more expensive to pay the models and assistants to wait on set than to rush the film, rush and double rush are still available, and labs will work with major clients who shoot film to make things work for them.

I don't know how this plays out in other cities, but I suspect we're just seeing concentration of media photography anyway in major cities like New York, Los Angeles, and Chicago, because that's where the rest of the industry is, and film is a viable commercial medium in those places where there are businesses that can afford the luxury of film. In a high-circulation slick fashion magazine where a full page can cost more than $100,000 just for the ad space, the cost of film and processing and whatever one needs to do to achieve the desired level of "convenience" is insignificant.

Some do this on occasion but far often, they'll use something like the Hasselblad H4D-40.

 

[clayne]

Steel is gradually coming back, Ron. People are starting to figure out that it is way more expensive to ship scrap more than the circumference of the
earth to get dubious quality and spot outages. But it never was a miscalculation to outsource it. Rather, there was an oligarchy of about twelve very wealthy businessmen who controlled the scrap steel commodity. They made huge sums of money monopolizing its trade and
by shuffling it back and forth. Stainless is a more specialized material and
a lot of what is imported is only marginally worthy to be called stainless.
Economical "stainless" sinks will sometimes rust within half an hour with
lemon juice or ketchup on it - not even 18-8, let alone 303 or 316. But
you'd be amazed how fast someone's temper can flare when they realize
they're sitting on a couple of acres or a few million dollars worth of outsourced rebar that won't pass inspection. The smart-alecs only rule
the roost for awhile.

I don't doubt for a second that this kind of orchestrated outsourcing is corrupted and controlled by a select group of people - both in the steel industry and elsewhere. Greed rules the roost as usual.

Any thoughts on corruption or coercion within the inspection side? If they can make that happen full circle then the clients are the ones holding the bag entirely. Happens all the time in 3rd world countries.

 

[David A. Goldfarb]

Lots of high-end digital in use to be sure, but someone's out there feeding the processing lines at Duggal, Modernage, and LTI.

We've also got universities teaching film photography, two freestanding Lomography shops and Lomography products in several other stores around the city, not to mention establishments that are happy to feed the desires of Leica enthusiasts and Rollei fetishists, rental houses with both film and digital equipment, rental darkrooms, studio space, and generally anything one needs to be any kind of photographer one wants to be, if one has the talent, imagination, and financial resources.

 

[DREW WILEY]

Clayne - I already know way, way more about how things are rigged than is appropriate for a specific discussion like this one. And I'll be glad when
I can retire from the corporate world (hopefully in the not too distant future) and concentrate on things more important to me. You know the
saying - what goes around comes around. Jerks usually manage to hang
themselves with their own rope, but then more jerks pop up who are willing to take the same risk. As far as I'm concerned, American manufacturing delieberately committed suicide.

 

[DREW WILEY]

CGW - just getting back to you. I've been out on the trail all day actually
enjoying film, 8x10 in fact. But around here digital imaging pros get hired
and fired thousands at a time. Then the schools in the area are cumulatively turning hundreds more each session. Where are they all going to go? There are a lot of people employed in this field locally, but
getting your foot into the door can be pretty difficult. Besides people skills,
versatility is the key. Employers want adaptable people. Being able to draw of do film photogaphy, and having this in a portfolio or resume, is a
distinct asset. The technology will change, possibly rapidly. Visual talent
that can express itself in more than one medium is a clue to adaptability.
But I don't know why you think pros weren't able to handle film development or basic darkroom skills. It was just a generation ago when
someone had to master these basics just to graduate from a photography
program. Using a thermometer isn't that complicated.

 

[Photo Engineer]

Drew;

Steel is coming back but a disproportionate amount comes from dubious sources and is not quite up to par. You cannot see this until it is cut, but it is there. Inspection does not seem to catch it for some reason!

As for reading a thermometer, is it a rectal thermometer?

Anyhow, Steel plants in Germany, Japan and China are far more modern than US versions and that has contributed to the problem. OTOH, the EK plant is the most modern but outsourcing has helped in costs for labor. This is a complex problem that cannot be solved or even described in a simple post here. All I gave was the gist I saw happen over 30+ years.

PE

 

[Svi]

I know of at least 2 brand new steel processing facilities in the USA.
One started production in 2010 in Alabama, the other one is being constructed in Pennsylvania.
Who knows, maybe in a few years there will be new film coating facilities in construction as well

 

[Rudeofus]

Greece has a credit event and all the other countries are scrutinized and their risk profiles rise. AIG had a credit event, and insurers suddenly had solvency issues all over.
[...]
I never said weeks, either.

So how suddenly is "suddenly" then? Months? Years? Decades? Once Lehman tanked the markets froze immediately, the same day! When AIG had to be saved from its own criminal stupidity, insurers suffered immediately, not weeks later.

To be honest, your credibility would suffer less if you said "yeah, I was wrong here for such and such reason" than drag out this doom prediction game for another six months just to see it fail again.

Where I live, no darkroom supplies are available. None. It's all mail order or nothing, and vast geographic swathes are subject to the same problems, so on the balance of facts, Ilford will eventually have problems as well. If there is more supply of darkroom than demand, then the same will happen to film. If the biggest supplier has problems in ANY industry, there is strong potential for cascading problems throughout an already stressed supply chain.

Henning already mentioned that there seem to be regional differences in popularity of film and dark room related things. Nobody denies that demand&supply took a strong hit in the last 10-15 years, but in some areas (including Central Europe) they are still hanging in there.

 

[Aristophanes]

So how suddenly is "suddenly" then? Months? Years? Decades? Once Lehman tanked the markets froze immediately, the same day! When AIG had to be saved from its own criminal stupidity, insurers suffered immediately, not weeks later.

To be honest, your credibility would suffer less if you said "yeah, I was wrong here for such and such reason" than drag out this doom prediction game for another six months just to see it fail again.

Henning already mentioned that there seem to be regional differences in popularity of film and dark room related things. Nobody denies that demand&supply took a strong hit in the last 10-15 years, but in some areas (including Central Europe) they are still hanging in there.

You already saw it with Kodak price increases. You'll see an acceleration of product losses, like Plus-X, and E6, and more cuts from Fuji as well.

To retain cash they'll start retracting less profitable product lines and force consumer choices elsewhere.

Three are regional differences. After cash and credit, distribution anomalies are probably the biggest challenge.

The clock ticking is the 13 months of Ch. 11 for Kodak. Because Kodak is so big, its reorganization forces all the suppliers (and their suppliers, and their money backing them) to reorganize, or at least plan contingencies, as well. Once those creditors see a measure of residual demand for film (the niche), then you'll see the credit and investment scale to that demand curve. All that surplus capacity will not be mothballed, it will be scrapped and the capital reallocated elsewhere.

This isn't the only industry going through stuff like this. Refined oil distribution, legal publications, pulp and paper, all are faced with too much supply in some areas,, poor distribution in other areas, and too much competition. Everyone limps along until 3 or more suddenly all go into crisis at one time. Capitalism isn't clean where the weakest falls and the others get its customers. Oh, no. It's usually far, far messier than that.

In theory, if Kodak had seen this coming, they could have reallocated revenues and put its competitors out of biz by dropping margins to gain absolute market share. They have the production capacity to put a huge squeeze on all other players on price alone. They *could* do that *if* they had a long-term game plan for film, which they do not.

 

[CGW]

Lots of high-end digital in use to be sure, but someone's out there feeding the processing lines at Duggal, Modernage, and LTI.

We've also got universities teaching film photography, two freestanding Lomography shops and Lomography products in several other stores around the city, not to mention establishments that are happy to feed the desires of Leica enthusiasts and Rollei fetishists, rental houses with both film and digital equipment, rental darkrooms, studio space, and generally anything one needs to be any kind of photographer one wants to be, if one has the talent, imagination, and financial resources.

Pretty much the same here in Toronto, albeit on a slightly smaller scale. I'm grateful and just hope quality processing holds on--so far, so good.

 

[semi-ambivalent]

Steel is gradually coming back, Ron. People are starting to figure out that it is way more expensive to ship scrap more than the circumference of the
earth to get dubious quality and spot outages. But it never was a miscalculation to outsource it. Rather, there was an oligarchy of about twelve very wealthy businessmen who controlled the scrap steel commodity. They made huge sums of money monopolizing its trade and
by shuffling it back and forth. Stainless is a more specialized material and
a lot of what is imported is only marginally worthy to be called stainless.
Economical "stainless" sinks will sometimes rust within half an hour with
lemon juice or ketchup on it - not even 18-8, let alone 303 or 316. But
you'd be amazed how fast someone's temper can flare when they realize
they're sitting on a couple of acres or a few million dollars worth of outsourced rebar that won't pass inspection. The smart-alecs only rule
the roost for awhile.

e.g. the debacle over Chinese drywall polluted with sulfer. I think the MO is not to rule forever but just long enough to get that vacation house in Aspen or Lake Placid or Santa Barbara. Aided and abetted by corrupt government officials, of course. It's the Soviet model adapted by Western businesses under the excuse of needing to meet shareholder expectations....

s-a

 

[Rudeofus]

You already saw it with Kodak price increases.

The increases in gas prices hurt me more than increases in film prices. Yet one is the result of increased demand while the other is supposed to be the result of insufficient demand. The answer to this is that any company will crank prices as high as the market will bear. While everybody talks about Fuji, Kodak and Ilford competing in the same market, there is no direct competitor to Portra or Velvia or Delta 3200 (in 120 roll film at least). All these "competitors" are basically monopolists in their niche and take full advantage of it. Profitably.

You'll see an acceleration of product losses, like Plus-X, and E6, and more cuts from Fuji as well.
To retain cash they'll start retracting less profitable product lines and force consumer choices elsewhere.

I see a slow trend but no sudden disaster. A slow trend can stop or reverse any time. Some films have been discontinued but I fail to see an "acceleration of product losses". What I do see is a move from dinosaur products to niche products, look at the Rollei product line.

The clock ticking is the 13 months of Ch. 11 for Kodak. Because Kodak is so big, its reorganization forces all the suppliers (and their suppliers, and their money backing them) to reorganize, or at least plan contingencies, as well. Once those creditors see a measure of residual demand for film (the niche), then you'll see the credit and investment scale to that demand curve. All that surplus capacity will not be mothballed, it will be scrapped and the capital reallocated elsewhere.

There is no need to mothball any surplus capacity as the Kodak machinery in question is unsuitable for niche production. Either they can use one single coating line for every remaining product in their portfolio including film and paper, or they have to repurpose a coating machine from their R&D.

 

[Simon R Galley]

Dear Aristophanes,

Just read your post :

ILFORD "dogged by bankruptcy"..... the business strated 1879 made it to 2004 then had an 'administration' ( not dissimilar to Chapter 11 ) thats not dogged.

Yesterday, HARMAN technology, the management buy out celebrated 7 years in business.

ILFORD has always been a niche marketeer, in photo we stayed with Black & White and specialised.

"Machines quite old" : Our automated emulsion making is state of the art, bar no-one. Our finishing is state of the art.

Our coating machine is indeed from the 1970's : It is now probably the most flexible photo quality coating machine in the world: It coats film / paper / inkjet / polyester base / art / and other substrates. It is maintained and upgraded by our own engineers to an exceptional level and has a new process control system recently installed. It has a product to product change regime that no one else could match ( 90 minutes ).

Quality control systems that are in place show almost zero defects in any product range.

Our niche is to maintain all the products we currently make, that we have done and will continue to do. We make more monochrome products than all the other makers, and will continue to do so.

We can and do scale our business, it works just fine.

We are passionate about monochrome, we are passionate about analog but firstly we run a business and remain robustly profitable.

Simon ILFORD Photo / HARMAN technology Limited :

 

[liquid695]

Simon :

Well done !!!

 

[Steve Smith]

Simon :

Well done !!!

Agreed!


Steve.

 

[Steve Smith]

There is no need to mothball any surplus capacity as the Kodak machinery in question is unsuitable for niche production. Either they can use one single coating line for every remaining product in their portfolio including film and paper, or they have to repurpose a coating machine from their R&D.

Basiaclly, whatever they are doing now will be fine for the foreseeable future.


Steve.

 

[keithwms]

Thanks for that, Simon!

We are passionate about monochrome, we are passionate about analog but firstly we run a business and remain robustly profitable.

And a large and growing number of us are passionate about using your great products and don't mind you making enough profit to feed yourself on the side...

It has a product to product change regime that no one else could match ( 90 minutes ).

Good. I'm sure that you won't mind running off some large format xp2 then; I'll send my mailing address. If you need another pair of hands at the machine, I'll happily pop over.

 

[Photo Engineer]

Thank you Simon for putting paid to these comments by know nothings.

Ilford, Kodak and Fuji stand alone in the industry with the highest quality production facilities. No one should denigrate the quality or capability of any one of these especially Ilford.

PE

 

[Aristophanes]

Dear Aristophanes,

Just read your post :

ILFORD "dogged by bankruptcy"..... the business strated 1879 made it to 2004 then had an 'administration' ( not dissimilar to Chapter 11 ) thats not dogged.

Yesterday, HARMAN technology, the management buy out celebrated 7 years in business.

ILFORD has always been a niche marketeer, in photo we stayed with Black & White and specialised.

"Machines quite old" : Our automated emulsion making is state of the art, bar no-one. Our finishing is state of the art.

Our coating machine is indeed from the 1970's : It is now probably the most flexible photo quality coating machine in the world: It coats film / paper / inkjet / polyester base / art / and other substrates. It is maintained and upgraded by our own engineers to an exceptional level and has a new process control system recently installed. It has a product to product change regime that no one else could match ( 90 minutes ).

Quality control systems that are in place show almost zero defects in any product range.

Our niche is to maintain all the products we currently make, that we have done and will continue to do. We make more monochrome products than all the other makers, and will continue to do so.

We can and do scale our business, it works just fine.

We are passionate about monochrome, we are passionate about analog but firstly we run a business and remain robustly profitable.

Simon ILFORD Photo / HARMAN technology Limited :

My apologies Simon. My word "dogged" was a little harsh. I checked the Harman credit rating....it's OK. Not great, but OK. Sadly, and with Kodak's problems, film production has a stigma. There's no way around it.

I worry for you and other small suppliers because the credit and distribution channels are critical, and the complete loss of many supplied geographies makes it very, very difficult to see a sustainable market presence for film despite residual demand.There is a dependence on darkrooms and small labs for which the manufacture of components is small to non-existent, and declining. My take (and I work for an international market analysis firm) is that those co-dependencies are the major issue, labs, cameras, etc. Those are not being addressed, and Kodak, the title of this thread, ostensibly has the ooomph to do so, but will not, cannot. Ilford is wise to specialize but that also brings a certain vulnerability of which you are no doubt aware.

I have said repeatedly that Ilford's mail order lab system is going to be critical to stemming falling home darkroom demand. That and scanning which you also offer, rare for b/w. Obviously Ilford has been more nimble than Kodak.

 

[keithwms]

No one should denigrate the quality or capability of any one of these especially Ilford['s facilities].

+1 hear, hear!

 

[KarnyDoc]

Dan;

That is right but a bit misleading in this sense. As scale goes down, overhead stays constant and thus cost per unit produced goes up. Also, for some products, as scale goes down so does quality unless the product is redesigned for that scale / speed. This costs money as well.

As I understand it, there is a smaller machine still there and there are some in KRL that could be used with some pain. IDK what exists any more and what costs are involved.

I can say this. At the present time, with good management, there is room for Kodak, Fuji and Ilford along with the smaller European companies. The operative phrase is "with good management" which Kodak has apparently not had under Perez.

PE

Perhaps Kodak could lease time on their mothballed production equipment to the European film companies? Everybody benefits: the European companies have a stateside production line, which helps keep their transportation costs down, and Kodak, as a company, has another source of revenue, while at least some of Kodak's furloughed employees can earn a paycheck again.

Just my two cents.

Dieter Zakas

 

[Roger Cole]

+2 Ilford makes great materials and does so profitably.