Kodak committed to making film "as long as there's demand"

[Alan Edward Klein]

Quoted, just in case anyone thinks being a Moderator is easy ........
This is, of course, a thread about Kodak.

Let's start a thread of film vs digital.

 

[brbo]

A 67% price increase in just over two years seems pretty extravagant to me!

Obviously you don’t know what Eastman Kodak and what Alaris is.

 

[cmacd123]

I don't know if print film has remjet or not, I was merely pointing out that print film isn't archival,

Actually, both items have a bit of a history to them.

Back in the 1980s, Print film was both not intneded for long term storage, and was made with a rem-jet backing.
the remjet change was one of the steps taken to reduce water consumption in Processing labs. the curent Print film 2383 and 3383 has a process survivable anti static coating and an AHU antihalation leyer which becomes colourless in the course of processsing. the curent data sheet says " The back side of the raw stock has no rem-jet, appears dark blue to slate-gray, and has a slight iridescence."

the other change required the entire industry to change the sound pickups in ALL movie projectors. the sound track even on Colour prints was either silver or silver sulfite. the old method would have a wash after the Bleach, and a Gel developer would be applied to the soundtrack area. that turned the bleached silver halide back into silver again. then their was another wash before the fix. to eleminate the wash steps, the entire industry turned to a Cyan coloured sound track, which must be read with a red LED or Laser sound head in the projector. The sound heads before were mostly sensitive to infrared, which worked fine with a silver track. the red light will also work with a silver track, so legacy prints work fine. the cyan is used so that their is only one layer of the film with sound recorded to get the sharpest sound track posible.

those changes saved three wash steps.

Now as far as stability. Kodak took a lot of heat back in the late 20th century as the older print films we basied to have good color when they were recently made over long term stability. the justification for that was that most theatrical prints were destroyed after the movie finished a run in theaters. But that meant that even a print that was stored in the dark would turn color after a few years. worse, 16mm prints which were used for education also faded long before they were obsolete.

Kodak quietly had several variations starting with a reformulation which was only shown as the initials LLP on the edge print.

the data sheet for the curent print film says " Processed prints made on this film will show less than 10- percent image dye loss, even after several decades of storage at room temperature and 50-percent relative humidity."

 

[Sal Santamaura]

Obviously you don’t know what Eastman Kodak and what Alaris is.

Nope. I've no idea. I'm just an Internet poster who jumps in to contribute uninformed nonsense. A user of Kodak products since 1962. A PHOTRIO (nee APUG) member since 2005. I know nothing.

 

[brbo]

No problem.

Now you know that Eastman Kodak does not sell still film to end customers and consequently can't set prices on Kodak still film you are buying.

 

[Alan Edward Klein]

No problem.

Now you know that Eastman Kodak does not sell still film to end customers and consequently can't set prices on Kodak still film you are buying.

Well, if Kodak raises their prices to Alaris, those increases are felt at the retail level as well.

 

[brbo]

And we've been through that already. Alaris is paying about a buck per roll more than two years ago.

 

[OrientPoint]

I've taken the rapid upward price movement of Kodak film to simply be Eastman Kodak trying to squeeze as much revenue as they can out of legacy infrastructure (those 1990's vintage multi-million dollar coating and packing lines) before the market for film becomes completely unviable. I remember an interview a few years back with Robert Shanebrook (@laser), the author of Making Kodak Film, where he recalled that when digital came into the market in full force in the 2000's almost no one at Kodak, including him, thought it possible that film would still be in production this late in the game.

If that mindset persists at Kodak, and lines like "as long as there's demand" sure make it sound that way, then jacking prices all the way to 11 would seem quite rational. Unfortunately, it also implies my favorite Portra and TMAX films probably aren't going to be around 10 years from now.

 

[brbo]

I've taken the rapid upward price movement of Kodak film to simply be Eastman Kodak trying to squeeze as much revenue as they can out of legacy infrastructure

You've taken that from where? I've been reading the financial reports from Eastman Kodak and Alaris for years now. Alaris' increase in Film revenue is growing at about 30+% per year (exception was 2021 with only about 10% increase due to Covid). They cite increased volume and price as a reason for increase in revenue. On the other hand, Eastman Kodak's revenue increase from film deal with Alaris is much more modest. The price disputes (resolved in Alaris' favour) mentioned in financial reports further indicate that Eastman Kodak as the producer of your beloved Portra and TMax film obviously can't jack the prices to 11. It's somebody else doing that...

 

[Agulliver]

I've taken the rapid upward price movement of Kodak film to simply be Eastman Kodak trying to squeeze as much revenue as they can out of legacy infrastructure (those 1990's vintage multi-million dollar coating and packing lines) before the market for film becomes completely unviable. I remember an interview a few years back with Robert Shanebrook (@laser), the author of Making Kodak Film, where he recalled that when digital came into the market in full force in the 2000's almost no one at Kodak, including him, thought it possible that film would still be in production this late in the game.

If that mindset persists at Kodak, and lines like "as long as there's demand" sure make it sound that way, then jacking prices all the way to 11 would seem quite rational. Unfortunately, it also implies my favorite Portra and TMAX films probably aren't going to be around 10 years from now.

You take it wholly incorrectly. As borne out by the data and the words from the horse's mouth.

Have you also failed to notice that prices - globally - have gone up for just about everything from basic foodstuffs to laboratory chemicals.....from simple digital watches to computers? Everything Kodak uses to manufacture film has gone up in price, at a time when they've invested in *increasing* production capacity by employing hundreds more people to make film.

 

[Alan Edward Klein]

I've taken the rapid upward price movement of Kodak film to simply be Eastman Kodak trying to squeeze as much revenue as they can out of legacy infrastructure (those 1990's vintage multi-million dollar coating and packing lines) before the market for film becomes completely unviable. I remember an interview a few years back with Robert Shanebrook (@laser), the author of Making Kodak Film, where he recalled that when digital came into the market in full force in the 2000's almost no one at Kodak, including him, thought it possible that film would still be in production this late in the game.

If that mindset persists at Kodak, and lines like "as long as there's demand" sure make it sound that way, then jacking prices all the way to 11 would seem quite rational. Unfortunately, it also implies my favorite Portra and TMAX films probably aren't going to be around 10 years from now.

I don't think Kodak is suicidal. But they could be too greedy. If that happens, then overall sales will drop and they'll have to adjust their pricing. What I'm curious about is how Eastman Kodak and Alaris arrive at their price points and markups. Is there a discussion between them about that in terms of what the overall Market is expecting?
I could see Alaris complaining to Eastman that their markups are too high not leaving Alaris enough room to make enough of a profit squeezing Alaris's markups.

 

[OrientPoint]

Kodak in 2023 is a printing and coating technology company with a legacy film business. Even at Kodak, film is now a small percentage of their revenue. The film business is growing again, but from a small base, and it will never again be a main revenue driver for the two remaining global corporate players (Kodak & Fuji).

Film production is capital intensive. No one would start a film manufacturing line from scratch in 2023 (every one, from Adox to Innoviscoat to Ferrania is using old infrastructure). But if you already have a ton of capital long-ago sunk into a line, and you can sell product profitably, you run it. If they believed in the long-term prospects of the business they'd work to keep the price increases in a sustainable range through production innovation. This sort of innovation requires capital, which is why it's not happening. On a global level (which is what Kodak and Fuji are structured for) – not just enthusiasts and artists – no one needs film in 2023. $18 rolls of Portra and $28 rolls of Velvia will sell for a while, but ultimately will kill the market. Which may just be fine with Kodak (and Fuji) if the market decline mirrors the depreciation of their infrastructure.

I realize this a bleak take, but it's the only answer I can see for that burning question: what exactly is the market for $24/sheet 8x10 Portra and $18 rolls of Portra 800?

Companies that do see a sustainable future for film production (Ilford being a prime example) seem more intent on keeping prices under control, even in the current inflationary environment. A box of Kentmere is less than $6 at B&H and Ilford's quality is every bit as good as Kodak and Fuji.

 

[brbo]

I could see Alaris complaining to Eastman that their markups are too high not leaving Alaris enough room to make enough of a profit squeezing Alaris's markups.

Eastman Kodak on average can't possibly get more than about $4 per roll from Alaris (probably less). I really can't see Alaris complaining. Hell, Alaris clearly state that their revenue from film went up 38% in last fiscal year alone because of favourable shifts in pricing and quantity. EK reported 10% increase in revenue from Alaris. If EK's entire increase came from price increase, then also Alaris' increase also came from their price increase. So, we have EK increasing their price at 10% and Alaris at 40%. What is your rationale behind insisting that Eastman Kodak must be driving the prices to the sky?

Don't get me wrong, I'm pretty sure that if EK would have the right to market their still film, prices wouldn't be at 2015 levels. They are not stupid and they'd want to make as much money as possible in the long run. But currently it looks like EK is making the product that is in very high demand, that nobody else is producing in any meaningful quantities and reaping relatively poor profits.

As with every Fuji's past statement of "total commitment to film", that ironically always came after discontinuation of one of their films, I read Kodak's version of "commitment to film" with great joy, but also with a bit of anxiety. A bit like "yes, we're in the game up to 2028, but Alaris better stop raping the market or soon demand might not be there anymore".

 

[Alan Edward Klein]

Kodak in 2023 is a printing and coating technology company with a legacy film business. Even at Kodak, film is now a small percentage of their revenue. The film business is growing again, but from a small base, and it will never again be a main revenue driver for the two remaining global corporate players (Kodak & Fuji).

Film production is capital intensive. No one would start a film manufacturing line from scratch in 2023 (every one, from Adox to Innoviscoat to Ferrania is using old infrastructure). But if you already have a ton of capital long-ago sunk into a line, and you can sell product profitably, you run it. If they believed in the long-term prospects of the business they'd work to keep the price increases in a sustainable range through production innovation. This sort of innovation requires capital, which is why it's not happening. On a global level (which is what Kodak and Fuji are structured for) – not just enthusiasts and artists – no one needs film in 2023. $18 rolls of Portra and $28 rolls of Velvia will sell for a while, but ultimately will kill the market. Which may just be fine with Kodak (and Fuji) if the market decline mirrors the depreciation of their infrastructure.

I realize this a bleak take, but it's the only answer I can see for that burning question: what exactly is the market for $24/sheet 8x10 Portra and $18 rolls of Portra 800?

Companies that do see a sustainable future for film production (Ilford being a prime example) seem more intent on keeping prices under control, even in the current inflationary environment. A box of Kentmere is less than $6 at B&H and Ilford's quality is every bit as good as Kodak and Fuji.

A $28 roll of Velvia today would cost around $4.08 50 years ago in 1973. $18 for Portra now around $2.61 then. Inflation is around 588%. What did film run back then in 1973?
Inflation calculator: https://www.usinflationcalculator.com/

 

[BrianShaw]

A $28 roll of Velvia today would cost around $4.08 50 years ago in 1973. $18 for Portra now around $2.61 then. Inflation is around 588%. What did film run back then in 1973?
Inflation calculator: https://www.usinflationcalculator.com/

I bought tons of film back then, mostly Ektachrome and Plus-X, but have no recollection of the cost. There are tons of old photography magazines on archive.org that you can use to answer your question. This kind of question has been asked repeatedly, it seems, about both film and cameras. Interesting I suppose, but does it really matter much… then was then and now is now. There seems zero chance of ever going back.

 

[Sirius Glass]

I've taken the rapid upward price movement of Kodak film to simply be Eastman Kodak trying to squeeze as much revenue as they can out of legacy infrastructure (those 1990's vintage multi-million dollar coating and packing lines) before the market for film becomes completely unviable. I remember an interview a few years back with Robert Shanebrook (@laser), the author of Making Kodak Film, where he recalled that when digital came into the market in full force in the 2000's almost no one at Kodak, including him, thought it possible that film would still be in production this late in the game.

If that mindset persists at Kodak, and lines like "as long as there's demand" sure make it sound that way, then jacking prices all the way to 11 would seem quite rational. Unfortunately, it also implies my favorite Portra and TMAX films probably aren't going to be around 10 years from now.

Based on exactly what? Your anger at the costs of film going up? Kodak has to stay in business and to do that cover their costs.

 

[OrientPoint]

Based on exactly what? Your anger at the costs of film going up? Kodak has to stay in business and to do that cover their costs.

There's no anger. I just find the economics of this interesting and enjoy theorizing about it.

I am not suggesting Kodak hasn't the right to cover their costs, or charge whatever they want. I am merely saying that they could manage prices and try to grow the market, or they could try to wring every last dollar out of each sale while the market lasts. From their pricing, marketing and statements like the one from which this thread gets its title, I believe they have chosen the latter strategy.

A $28 roll of Velvia today would cost around $4.08 50 years ago in 1973. $18 for Portra now around $2.61 then. Inflation is around 588%. What did film run back then in 1973?
Inflation calculator: https://www.usinflationcalculator.com/

Comparisons of inflation adjusted prices may or may not be relevant. In 1973 film was a necessity in many industries. In 2023 it's an art/hobby supply.

A professional photographer (or an industrial user) in 1973 would have been able to justify a relatively high film cost by passing it onto their customers, sustaining the market. Consumers in 1973 had no other choice for making images - and then as now they wanted to make images - so a relatively high cost of film could be justified as an affordable luxury. Who are the users in 2023? Are there enough people now for which film is important enough to justify high prices relative to other consumables when there are so many faster/simpler/cheaper ways to make images? I'm one of the people who will pay these prices. The problem, I fear, is that there aren't very many of us left and Kodak knows this.

 

[Sirius Glass]

There's no anger. I just find the economics of this interesting and enjoy theorizing about it.

I am not suggesting Kodak hasn't the right to cover their costs, or charge whatever they want. I am merely saying that they could manage prices and try to grow the market, or they could try to wring every last dollar out of each sale while the market lasts. From their pricing, marketing and statements like the one from which this thread gets its title, I believe they have chosen the latter strategy.


Comparisons of inflation adjusted prices may or may not be relevant. In 1973 film was a necessity in many industries. In 2023 it's an art/hobby supply.

A professional photographer (or an industrial user) in 1973 would have been able to justify a relatively high film cost by passing it onto their customers, sustaining the market. Consumers in 1973 had no other choice for making images - and then as now they wanted to make images - so a relatively high cost of film could be justified as an affordable luxury. Who are the users in 2023? Are there enough people now for which film is important enough to justify high prices relative to other consumables when there are so many faster/simpler/cheaper ways to make images? I'm one of the people who will pay these prices. The problem, I fear, is that there aren't very many of us left and Kodak knows this.

The problem is that some of the required components are driving the costs and since those chemicals have limited sources. All film manufacturers have to deal with component sourcing supply problems.

 

[Sal Santamaura]

Nope. I've no idea. I'm just an Internet poster who jumps in to contribute uninformed nonsense. A user of Kodak products since 1962. A PHOTRIO (nee APUG) member since 2005. I know nothing.

No problem.

Now you know that Eastman Kodak does not sell still film to end customers and consequently can't set prices on Kodak still film you are buying.

You misinterpret my sarcasm as reality. Of course Eastman Kodak doesn't directly establish the retail prices of still film. That doesn't mean it isn't driving the extravagant increases in those prices.

...Alaris' increase in Film revenue is growing at about 30+% per year (exception was 2021 with only about 10% increase due to Covid). They cite increased volume and price as a reason for increase in revenue. On the other hand, Eastman Kodak's revenue increase from film deal with Alaris is much more modest...

Making the leap from those overall figures to dismissal of Eastman Kodak as the driver of extravagant increases in Kodak black and white retail film prices is invalid. I speculated that Alaris might, if its agreement with Eastman Kodak permits, market and distribute other manufacturers' black and white films (not branded "Kodak") to supplement its revenue as sales of Kodak black and white film decline due to prices higher than the market will bear. Henning's posts have described such a market condition already. Unless you have insider information and are likely violating a nondisclosure agreement, nothing you've posted is any more credible than what I've posited.

 

[brbo]

Alaris only markets Kodak films produced by Eastman Kodak. That is a fact. If Henning says otherwise, he is wrong.

I've explained why it doesn't make sense for Alaris to price BW film more aggressively to be more competitive.

 

[MattKing]

Alaris only markets Kodak films produced by Eastman Kodak. That is a fact. If Henning says otherwise, he is wrong.

I've explained why it doesn't make sense for Alaris to price BW film more aggressively to be more competitive.

Yes.
But could their contractual obligations permit them to expand their business and distribute non-Kodak films?
And would they want to?

 

[brbo]

But could their contractual obligations permit them to expand their business and distribute non-Kodak films?

I don't know. Why not? I can't see Eastman Kodak dictating any terms to Alaris. Considering the history, it's pretty much the other way around.

And would they want to?

I'm sure they would love to buy Foma films for 1 EUR and sell them for 6 EUR, but Foma owes Alaris nothing and they are not stupid. Neither are Ilford, Adox, Orwo...

 

[MattKing]

I don't know. Why not? I can't see Eastman Kodak dictating any terms to Alaris. Considering the history, it's pretty much the other way around.

They - or at least the bankruptcy trustee and the court - certainly dictated many of the terms when the first agreement was negotiated.
And there is no doubt they did even more dictating when the effects of the pandemic put Kodak Alaris into breach and a forced re-negotiation happened thereafter.

But Kodak Alaris has a lot of power in the relationship as well, because there is no way that the portion of Eastman Kodak involved with photographic film has the resources to replace a world-wide distribution network.

 

[brbo]

Fine. I give up. Eastman Kodak sells 20m rolls of film to Alaris at $15 per roll and revenue from this somehow amounts not to $300m but $70m as reported in their financial statement.

Kodak Alaris must be run by the biggest idiots ever. They wrote off $2.8bn in debt and paid additional $650m to end up hostage to Eastman Kodak. Believe that if you want...

 

[Alan Edward Klein]

Yes.
But could their contractual obligations permit them to expand their business and distribute non-Kodak films?
And would they want to?

Alaris selling Kodak film is an exclusive. Alaris selling other films means they're competing with other distributors already well established with retailers.