How did kodak end up where it is?

Discussion in 'Industry News' started by pgtips, Aug 21, 2012.

  1. pgtips

    pgtips Member

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    I’ve been shooting Kodak colour and transparency film since I got into film photography a few years back, and they’ve never let me down, so when I had the opportunity to do a research project for school I decided to study the recent history of Kodak and how they ended up in their current state. It’s fairly obvious that they’re where they are now because they failed to capitalise on digital, but why this happened is harder to understand. I know that this site is for analogue photography, but any suggestions and answers for my questions below would be much appreciated, thanks.
    Kodak invented the digital camera. Though it is understandable that they were afraid of developing it at the time due to the threat it would pose to their film business, what was the thinking at the company that caused them to remain film centric after both their competitors and previously non photographic companies had begun to gain ground in the digital market?
    Why did they not streamline their film business in order meet the new, smaller demand for film? Also, why have they cut back on transparency film and kept lower end consumer film, which is surely a faster shrinking market?
    At what point did companies other than Kodak begin to look into digital, and at what point did Kodak begin to worry about these developments?
    For the majority of the 1990s, Kodak was not far behind Fuji or their other competitors where it came to digital technology and their early DSLRs produced higher quality images than other early digital cameras. I’ve read a report saying that prior to a leadership change in 2000 many in Fuji were also against the move away from film, so at what point did Fuji really gain the upper hand over Kodak when it came to digital?
    Why did Kodak move away from the professional end of digital photography and concentrate on the lower profit consumer end when they had less experience in the latter?
    At what point did the management of Kodak realise that film was going to be overtaken by digital, and at what point did it become too late for the company to make a smooth change?
    If digital had not arrived, where would Kodak be today? Would they have stagnated anyway in terms of creativity (APS didn’t exactly take of as the company had hoped) and been overtaken by more modern and creative companies regardless of the invention of digital?
    Overall, the main question I’m trying to answer is why did Kodak miss out on digital? Were they simply scared to develop it as they felt it would undercut film, or could they genuinely not see a way that the clunky, 0.01 megapixel digital camera that they invented in 1976 could be developed into a consumer product?

    Once again, I know this isn't strictly analogue stuff, but all help is appreciated :smile:
     
  2. BrianShaw

    BrianShaw Member

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    In the near future (if not already), I'm sure there will be one or more textbooks giving one or more explanations. I'm waiting to hear the answer from some world-renowned economicist... or wahtever the inverse of "futureist" is.
     
  3. vedmak

    vedmak Subscriber

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    I might be wrong, but here is my 2 cents, the age of the communication is what doomed Kodak and many others, marketing and information delivery had changed dramatically, hype is King. If you look closely on the ads today, they do not even begin to discuss technical aspects of the product, and that is how companies that manufacture quality products loose, new generation is googling in order to get info, despite the obvious fact that unbiased opinion is increasingly hard to find even in the newspapers.
     
  4. Photo Engineer

    Photo Engineer Subscriber

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    There are literally hundreds of posts here on this topic or ranging around it. You should look up some of them. You should also listen to some of our interviews on "Inside Analog Photography".

    PE
     
  5. Sal Santamaura

    Sal Santamaura Member

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    How about an explanation that might not have been offered yet?

    Kodak ended up where it is by not aggressively developing all aspects of digital imaging, patenting every iota of it, then keeping the technology off the market and preventing everyone else from bringing it to market via patent enforcement.

    With no digital alternatives available to the world, Kodak would still be coating as much high-margin sensitized product as ever and rolling in cash. Instead of engaging in the losing battle of consumer electronics competition, it would still be selling extremely profitable "razor blades" by the trainload.

    Other than that approach, I don't see how Kodak could have dodged the digital juggernaut. :smile:
     
  6. BrianShaw

    BrianShaw Member

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    In fact, my experience is that Kodak can't or won't discuss technical aspects of their products even when asked. AllI can get is a "form letter" response from someone who seems to just be learning English (and can't even get my name right) telling me to use a chat facility that doesn't work or call a phone number. I've had such a bad time trying to get an answer that I gave up and moved on to anther product... which also does not have techncial information associated with it.
     
  7. nexus757

    nexus757 Member

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    This is a bit simplistic, but I think if Kodak had just manufactured a decent, sturdy 35mm SLR--something to compete favorably with the Pentax K-1000, etc. back in the day--it would have gone a long way to improve the company's image long term among the public. By the 70s few advanced amateur photographers (or even freshmen photography students) were shooting Kodak cameras. They were mostly viewed as inexpensive, beginner cameras, with little or no exposure control, and I think this reputation somewhat tainted the Kodak brand as digital cameras became popular.
     
  8. Prof_Pixel

    Prof_Pixel Member

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    No simple answer

    Many of use in Kodak in the '80s and early '90s understood the transition that was coming. Several of Kodak's early digital products (RFS-2035, Premiere Image Enhancement System, Prism, and Photo CD for example) were hybrid products, meant to ease the transition into digital.

    Film was (and still is) a very mature product that has a manufacturing process that has been perfected over many years and had (has) a high profit margin. The profit margins on equipment were never good and digital cameras and equipment looked to have low profit margins as well.

    Kodak lacked the managers with imaging industry vision to figure out how to make the transition work (APS was a dreadful failure) and figure out what the new Kodak was going to look like. Note, this required a willingness to give up some short term profit to gain future profit and the managers pay incentive plans made that unlikely.
     
  9. MattKing

    MattKing Subscriber

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    Kodak's distribution system was a huge asset in their heyday. In recent years, it has/had become an effective tool for preventing sales.
     
  10. Prof_Pixel

    Prof_Pixel Member

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    That's because the people in Distribution no longer understand the imaging business.
     
  11. Kevin Kehler

    Kevin Kehler Member

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    I also think we need to remember that Kodak didn't think digital would take off till 2020 or so, and probably thought they had a lot more time to make changes. Recent article on Facebook said that if a billion can join in 24 months, a billion can leave in 24 months; the speed of which a product is discarded or rendered obsolete can be amazing.

    There really is a lot of other threads and posts on this topic; generally when researching, you gather data then conclusions. Your search seems to be looking for conclusions (coming from a life-long student, you won't learn as much without doing the actual research since secondary sources are never as useful as primary sources).
     
  12. Prof_Pixel

    Prof_Pixel Member

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    I'm not sure where the 2020 date comes from; it certainly isn't something we talked about in the '90s.

    I think the one bit of disruptive technology that really changed things was the rapid development and acceptance of smart phones that replaced consumer still and video cameras.
     
  13. Photo Engineer

    Photo Engineer Subscriber

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    Fred, a Kodak Technological Forecasting group (capital letters internally :D ) decided in the late 80s that digital would not become an important imaging method until about 2020. I disagreed with that and went to CPD management with my opinion only to be rebuffed. Message me for details.

    PE
     
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  15. Kevin Kehler

    Kevin Kehler Member

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    Thanks PE - I had that date in my head fairly firmly but could not recall the source of my information. I also recall one of your "Inside Analogue Photography" podcasts where you discuss how asking analogue film technicians what digital is going to do is like asking engineers what film technicians are going to do - it's not their area of expertise and as such, their opinions are not valid in the long term.
     
  16. Prof_Pixel

    Prof_Pixel Member

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    Ron,

    Those of us in PPD (late '80s/early '90s) who were working on digital projects weren't looking for it to take that long to happen.

    Everything considered, it took about 20 years to have a really major effect on the Company (1990- 2010)
     
  17. Photo Engineer

    Photo Engineer Subscriber

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    Fred, the company policy was made based on that Technological Forecasting group even though most everyone disagreed, as you say. They believed that it would take over 40 years! (1988 - 2020 or thereabouts). The problem was that top management agreed with the forecast and "sat" on any dissenting opinion.

    PE
     
  18. Prof_Pixel

    Prof_Pixel Member

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    That is certainly true. My PPD boss understood; things MIGHT have been different if they didn't get rid of him.
     
  19. Maris

    Maris Member

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    Kodak should have legally defended the concept of "photography" against "digital picture-making".

    By winning a court case against "digital" claimants asserting their product is "photography" Kodak would create two separate markets and be able to sell in both. And the case would only have to be run (and won) once in the United States to establish an enduring and persuasive precedent.

    There is a stunning present day example of the power of such litigation. For more than a hundred years any wine producer in the world turning out dry white bubbly wine could label it Champagne. And the grand Champagne houses in Europe were hurting all the way. Now with the power of the EU behind them these original Champagne producers will relentlessly sue any misappropriation of the name Champagne. The result of litigation or threatened litigation is that nobody anywhere labels non-authentic bubbly as Champage. Ok, there may be a few Californian hold-outs still bottling "champagne" but they run the risk of being thought of as being of lesser repute.

    Imagine a world in which re-labelling "digital" as "photography" would be considered dodgy and deceitful. For a few million bucks Kodak might have secured such a world. It may still be possible.
     
  20. jnanian

    jnanian Advertiser Advertiser

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    kodak got to where they are for alot of different reasons.
    one that i am kind of peeved about is they didn't sell master rolls
    to other people so they could cut them and package+resell them
    for people who shoot sheet film and who don't want to wait around
    for a "special order" to get a box of 7x11 or 2.5x3.5" sheet film,
    or something crazy big for a pinhole /camera obscura.

    there are lots of reasons why they are in the place they are in today ..
    and hindsight is always 20/20 ...

    vive la difference !
    john
     
  21. Prof_Pixel

    Prof_Pixel Member

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    LOL. Electronic imaging was around long before Kodak - just think of the space program images and video cameras. Digital was a logical extension.

    Kodak could no more have stopped the "digital picture-making' tide than King Canute could stop the tide.

    (Canute (or Cnut or Knut), a Dane who ruled England from 1015 to 1035, as well as Denmark, Norway, Parts of sweden, Pomerania and Schleswig, was a down-to-earth man anoyed by flattering courtiers who tried to tell him that he was all-powerful. To demonstrate that he was not, he had a throne placed on the seashore, sat in it, ordered the tide to go back, and duly got his feet wet.)

    When technology develops to a certain point, there is no putting it back in the bottle.
     
  22. Sirius Glass

    Sirius Glass Subscriber

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    Kodak worked really hard to make and market digital cameras from the start. They just could not get a popular design and the other companies could put out many more designs even faster.
     
  23. Prof_Pixel

    Prof_Pixel Member

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    It was clear to us right from the start, that camera sales weren't going to make enough money to sustain the company which was based on the sales of consumables. PhotoCD and on-line photo services were an attempt to get consumables. Ink jet printer inks have done well for Epson and HP, but Kodak was late to enter the game because they were pushing dye sublimation printing.
     
  24. rbeech

    rbeech Member

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    What's a newspaper?
     
  25. Prof_Pixel

    Prof_Pixel Member

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    An analog news delivery device rapidly being replaced by digital delivery on the web.
     
  26. Photo Engineer

    Photo Engineer Subscriber

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    Kodak did try to use DVDs and CDs as consumables, but they seriously mis-estimated the price curve of these products. They lost $$.

    PE