Film can't compete against the digital mass market, that's just stupid to think. Film is it's own thing and should (still) be branded as that. For artists and photographers it's a way of working and a tool to choose for the expression you want. For "normal" people the choice is more about workflow and less about the picture quality. I hear one thing a lot from customers, "My kids gave me a digital camera, but I use my film camera because it's easy to use and I get prints done easy." And for people using two-three rolls of film each year film is still cheap.
I totally agree with Aristophanes, the "You press the button, we do the rest" slogan is still something Kodak can work with. For many people, especially old, digital is not easy.
The days of high volume mass production multi billion business in the film industry is over, so those who want to be in the business must adapt to smaller volumes. The p&s family&holiday snapshot film market is soon dead, so it will defently be a niche market like the one Ilford has adapted to. When I say "dead" I mean there won't be a one hour minilab in each city, but it will of course be commercial labs for many, many years to come. For most people it will be via mail.