KODAK: DID YOU MAKE THE WRONG MOVE A DOZEN YEARS AGO?

David Lyga · Oct 6, 2011

Interesting to think what would have happened with the company if it had been steadfast and resolute in its support for analog and largely rejected digital. I am the furthest from a geek but I never felt that Kodak was really ready (or even acclimated) towards digital. If, instead, Kodak had continued improving analog and re-invigorated darkroom (through extensive advertising), I wonder if they would not be in quite the dire straits they are in now. They ARE, as I speak, still improving color film and Hollywood is far from digital projection worldwide, let alone within the USA.

Pehaps I am being overly naive here but wouldn't we be heralding the company now if they actually surpassed Freestyle Photo in sales by selling DIRECTLY to the public? That would have allowed greater flexibility with product introduction and an ability to react more quickly to changes in public demand. Witness the HOLGA and pinhole camera which CERTAINLY do NOTHING to improve technical quality. They became a genre, a sexy genre, that actually caught on. There really ARE a lot of analog users worldwide. And I have witnessed many very young folks who express a fascination for the whole concept of silver imaging. A 'new' genre, built upon the old, just might have caught on.

Sometimes old technologies, with all the bugs ironed out, can not only supplement the new ones but also provide an extra dimension for expression. Make that expression uninhibited, available, legitimate, and competitive. - David Lyga

Barry S · Oct 6, 2011

I'm not so sure. Kodak had the right idea--diversify out of a violently contracting market--the execution was just bad. For Kodak to have based its future on film--it would have had to accept that the company would contract as fast as the market. The Board and shareholders would have immediately gotten rid of the management--it couldn't have happened. The only real hope for the film division is that Kodak would successfully diversify into other profitable areas. They weren't going to spin off or sell the film division it was (and still is) making money--supporting the other cost centers. Kodak was built to be a behemoth--they don't do small.

wildbill · Oct 6, 2011

analog technology isn't fast and cheap enough for the majority of consumers. they want mediocre results immediately and don't think to care about the long term costs.

David Lyga · Oct 6, 2011

But, you know, in certain aspects they COULD have become 'small'. They could have focused upon film, paper, chemicals and other products as they became feasible. I placed this post to see if my wishful thinking would be fairly decaimed, or would there actually be a real thought here present in what I said. I know that the odds are against what I said but I really do wonder if they had to be, as you correctly say Barry, a 'behemoth' forever. Indeed, they did not seem capable of even thinking that they could be otherwise and, instead, largely committed suicide just like their founder did. Harsh words but maybe there is a thought here.

In more recent years they seemed to get further and further from the public. I remember in the 80s calling them and actually talking, at length, to a real chemist who did not try to rush me. Then, later you would call a person (20 something) who would look up (on the compuer) what you needed to know and there was no ability to read between lines or provide the insight like that chemist did. The feeling of disengagement was lost with the new management and, more importantly, that new management did not know HOW lost because they were so obsessed with that 'bottom line'. - David Lyga

David Lyga · Oct 6, 2011

NO ONE can deny the immediacy of digital. That is fact come to fruition. But, why are disposible cameras still selling well?

There are other concerns other than speed. For NON darkroom users the digital is probably the best way to go because that (potential) 'weak link' in the chain cannot be avoided. But do YOU want to give up analog? Why not? The most important answer to that question just might be that you cannot FULLY impart a full answer to the question because the full answer contains a pert that defies strict logic.

There is a subliminal portion to that answer that, although hidden or at least attenuated, remains very PERSONAL to you. It is almost like a hidden treasure that you do not want to ever leave you. You can SEE the negative and feel it. Some (most?) might disagree. but that does count for something. - David Lyga

nickrapak · Oct 6, 2011

Personally, I think Kodak made the wrong decision about 13 years ago. If Kodak came out with a $100-150 digital camera instead of APS, they would have cornered the market for digital cameras and would still be relevant today. Instead, they went too long trying to hang on to film on the consumer side of things, and that ended up all but eliminating their share of the market that made them successful. I think they should have stepped to consumer demand with digital, all the while pushing film as the "professional" choice. That way, they couldn't say they were ditching film, while all the while maintaining their presence in the consumer market.

Thomas Bertilsson · Oct 6, 2011

I don't know why they went after the printing market. The future lies in digitally sharing pictures. Artists will want to print their pictures, but consumers don't, so they went after the wrong digital segment.

In my limited way of thinking, I think that Kodak should have downsized their film operations by investing in more smaller machines when they built their new coating plant about a dozen years ago. They could be more flexible and responsive to market needs and make smaller master rolls to maintain products that completed their offering.
And side by side with that employ a team of really skilled marketing people, using their brains in researching what the general public will actually do with their pictures.

David Lyga · Oct 6, 2011

I felt then and feel now that APS was a bete noir. (The Instamatic in the 60s and 70s was a different matter.) Kodak never catered to people who WANTED to get professional results other than through their film/paper/chemicals.

In Europe, even the former USSR, 'cheap' cameras were made with the potential of high quality results even though attributes were strictly limited: ZENIT can compete with LEICA in certain aspects. HAWKEYE, BROWNIE, APS cannot compete with LEICA in ANY aspects!

Kodak film, paper, chemicals, of course were a different story, but Kodak's whole approach to professionalism largely stopped with the non-camera accessories. Their quality control is the envy of industry and I would not be surprised if Japan (even) learned a thing or two from them on this matter. Nobody tops them on this. And it is a shame to see the purpose of all this industrial perfection now be dying. - David Lyga

Barry S · Oct 6, 2011

Kodak never had the "Steve Jobs" they needed--a visionary who could transition their strengths and *create* new markets. When Jobs returned to the ailing Apple he moved Apple from a computer company to a technology company. Kodak was in a very tough position, but they could have made a similar transition instead of moving into other established markets.

Rick A · Oct 6, 2011

Kodak has a long history of backing the wrong horse. Just look at all their consumer grade cameras. Then there was the instant film fiasco(Polaroid won, Kodak had to pay through the nose). Digital imaging was invented at Kodak, why wouldn't they back it and promote the bejesus outta it. They are just a bunch of bumbling fools muddling along paying themselves the big bucks and laying off the folks that matter. They are not even close to being visionary.

zsas · Oct 6, 2011

Barry great point. They didnt move fast enough. Big companies can move fast if they have a Visionary. Look at Samsung, making hand over fist in chips, handsets, tablets, etc. They saw what they needed to do and did it (i.e Android handsets vs say Blackberry and Nokia using an OS that isnt going anywhere). Kodak? Humm, they do have their digital but didnt get a good enough strategy. Thats it. Look, they have one of the best sensors on the street, currently used by Lecia in the M9, but that is too thin of a cash stream when Sony is making a major % of digi sensors. They got hit too fast and hard w digi revolution and didnt diversify deep enough like say Samsung, Apple, and others that did a transformation in the right areas (good point Thomas, printing was prob the wrong path - prob cus it was too close to analog to be diverse enough).

BetterSense · Oct 6, 2011

For Kodak to have based its future on film--it would have had to accept that the company would contract as fast as the market. The Board and shareholders would have immediately gotten rid of the management--it couldn't have happened.

Click to expand...

This cannot be repeated enough.

Big companies like Kodak are literally unable to cope with contraction. It is an impossibility. Actually that's the case with our whole economy...it is predicated on growth. There is no mechanism for coping with a contraction or even a steady-state.

The same is true of government. It only grows, it never contracts, and there is no mechanism in place allowing any contraction of government. It can only grow. Just as a big company can only fail if its market contracts, a government will fail before it will contract.

CGW · Oct 6, 2011

David Lyga said:
Interesting to think what would have happened with the company if it had been steadfast and resolute in its support for analog and largely rejected digital. I am the furthest from a geek but I never felt that Kodak was really ready (or even acclimated) towards digital. If, instead, Kodak had continued improving analog and re-invigorated darkroom (through extensive advertising), I wonder if they would not be in quite the dire straits they are in now. They ARE, as I speak, still improving color film and Hollywood is far from digital projection worldwide, let alone within the USA.

Pehaps I am being overly naive here but wouldn't we be heralding the company now if they actually surpassed Freestyle Photo in sales by selling DIRECTLY to the public? That would have allowed greater flexibility with product introduction and an ability to react more quickly to changes in public demand. Witness the HOLGA and pinhole camera which CERTAINLY do NOTHING to improve technical quality. They became a genre, a sexy genre, that actually caught on. There really ARE a lot of analog users worldwide. And I have witnessed many very young folks who express a fascination for the whole concept of silver imaging. A 'new' genre, built upon the old, just might have caught on.

Sometimes old technologies, with all the bugs ironed out, can not only supplement the new ones but also provide an extra dimension for expression. Make that expression uninhibited, available, legitimate, and competitive. - David Lyga

This is just magical thinking. Please look at the trend line for film sales since 2000. Kodak did suffer from the collapse of analog but less so because of its other irons in the fire. It's not what it was and won't recover to pre-digital sales/production levels.

zsas · Oct 6, 2011

Bettersense, in a sense you are correct, but look at Apple, they contracted huge in the late 80's, it was a visionary that grew them back to today's massive company. I wonder if they laid off staff and then transformed? I bet so? I could be wrong.

michaelbsc · Oct 6, 2011

I think Kodak just screwed up with too little too late.

AFAIK Kodak invented the whole digital imaging field, much like the Swiss invented the quartz watch.

Then both let someone else run away with the prize.

As pointed out, no visionary.

Athiril · Oct 6, 2011

Hasselblad, Pentax, and others source CCDs made by Kodak for their digital gear.

It's not "digital" as a big umbrella term that's some harbinger of disaster.

zsas · Oct 6, 2011

Athiril - I believe they 'got digital', just marketed to the wrong camera makers to make their sensors. They support, as you say, Hasselbad, Pentax and I beleive Leica, all very niche makers, when they should have tried for the 80% or so, i.e., Nikon/Canon who use (I think) Sony or someone else...

tomalophicon · Oct 6, 2011

I think Canon makes their own.

I wonder how much film they supply to the Indian movie industry.

Aristophanes · Oct 6, 2011

David Lyga said:
Interesting to think what would have happened with the company if it had been steadfast and resolute in its support for analog and largely rejected digital.

Kodak would have been bankrupt 10 years ago. 99.9% of the consumer market has gone digital for the very sound economic reasons of cost, convenience, and consistency. The film market was obliterated by the instant gratification of digital, and more recently, the near-instantaneous sharing of the media.

No company with so many shareholders, stakeholders, and creditors can survive such a catastrophic revenue drop. Capital financial systems cannot allow invested capital to perish out of steadfastness. The market had spoken with the votes of millions of consumers. A digital camera adds value with each additional photo taken; a film camera adds cost. Economically film cannot compete.

Film survives in cinema because there is less need for instant gratification, and an aversion to sharing (preserve capital investment in IP).

This is not to say that film has no value as analog processes have their own aesthetic. However the marginal cost to achieve that aesthetic is now substantially greater for film making the medium non-competitive for casual snapshots or high volume shooting.

Kodak knew this, predicted this, planned for a switch to digital but botched the execution. If they had been better at the digital end (like Canon or Nikon or Olympus) then the film end could have been preserved with less financial baggage from the mothership. This is the crux of the problem.

zsas · Oct 6, 2011

tomalophicon - Back in the 80's or 90's maybe Kodak needed to sell Canon and Nikon their ability to make a better sensor? I believe they invented the amazing sensor tech (plus tons of patents that Apple, et al are all looking to buy), Kodak just couldnt sell it and thus the IBM syndrome (i.e. IBM and the PC of the 80's lost to Dell, etc)

Athiril · Oct 6, 2011

Kodak already made a full size 35mm dSLR, with a very large pixel count for it's time. They made it in both Canon and Nikon mounts iirc. In 2005 they discontinued that and focused that area on higher end/more expensive equipment - medium format, Leica as said, etc.

hoffy · Oct 6, 2011

Athiril said:
Kodak already made a full size 35mm dSLR, with a very large pixel count for it's time. They made it in both Canon and Nikon mounts iirc. In 2005 they discontinued that and focused that area on higher end/more expensive equipment - medium format, Leica as said, etc.

Which in hindsight was a massive mistake. Sure, there might be prestige in supplying the high end of town, but what of the DSLR boom? For every 1 'bald or Leica digi sensor sold, there is probably thousands of DSLR's sold (figures plucked off the top of my head).

If they had a DSLR that could be sold to suit popular mounts, they needed to market it properly, which in reality, they didn't.

As others have said elsewhere, when was the last time you saw a Kodak commercial running on TV or on billboards and bus shelters. Canon, Nikon, Sony still use these mediums to promote the photographic wares - Heck, even Sigma run TV commercials for their lenses. Kodak doesn't need a management guru, they need a marketing guru.

Mike Crawford · Oct 6, 2011

Barry S said:
Kodak never had the "Steve Jobs" they needed--a visionary who could transition their strengths and *create* new markets.

Um....well once upon a time there was a man called George Eastman.

tomalophicon · Oct 6, 2011

Mike Crawford said:
Um....well once upon a time there was a man called George Eastman.

Which computer did he invent?

Photo-gear · Oct 6, 2011

nickrapak said:
Personally, I think Kodak made the wrong decision about 13 years ago. If Kodak came out with a $100-150 digital camera instead of APS, they would have cornered the market for digital cameras and would still be relevant today. Instead, they went too long trying to hang on to film on the consumer side of things, and that ended up all but eliminating their share of the market that made them successful. I think they should have stepped to consumer demand with digital, all the while pushing film as the "professional" choice. That way, they couldn't say they were ditching film, while all the while maintaining their presence in the consumer market.

It sounds like a very comprehensive understanding of Kodak's (de)volution. The irony has it that while attempting to save up films on a large segment of the market, Kodak ended up the one that digged up the grave of the films (Kodachrome, 320tx, plus-x and several others).

I believe that the shareholders' greed forced the administrators to go for a quick buck and that might explain the disaster of their digital gears... Correct me if I am wrong...

KODAK: DID YOU MAKE THE WRONG MOVE A DOZEN YEARS AGO?

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