Did digital photography kill Kodak?

Eastman Kodak, once one of America's most illustrious companies, is nearly out for the count. Trading for a dollar a share, its fortunes now rest on patent lawsuits. Here's Sinead Carew, for Reuters:

Eastman Kodak Co shares lost more than half their value on Friday as the company hired a law firm well-known for bankruptcy cases, triggering speculation that the photography pioneer could file for bankruptcy.

Kodak, which delivered the first consumer camera in 1888, denied it had a bankruptcy plan, saying it was committed to meeting its obligations and is still looking for ways to "monetize" its patent portfolio.

People often suggest that there's an irony in Kodak having invented digital photography. But its real problem was a sales model based on selling cheap cameras and expensive media. So it wasn't killed by the digital camera, really. It was killed by the cheap flash memory that came with it.

Kodak denies bankruptcy plan but shares plummet [Reuters]


    1. They didn’t make cameras, except as a means to feel film. The Brownie et al were great intros but they didn’t make or sell a lot of cameras.  They moved into digital cameras but they’re a commodity product and with the advent of cameras in phones, just one more thing to carry. 

          1. Even more poor leadership is to surrender a century of leadership and innovation in chemical photography to become an electronics manufacturer. They would be a footnote if they had done that. 

            I don’t understand the idea that they should have abandoned their core business rather than simply accept that it would be smaller and work toward keeping that part vital. The consumer market was lost but the professional, scientific and fine arts markets continue. They would have lost them as well if they had decided to make electronics. 

            As for corporate inefficiency and poor management, that’s not unique to them. Sad but not unique. 

          2. How is it not poor management if the company is nearly tanked (that’s what this post is about)?

            Kodak (the man) was one of the early innovators of outstanding corporate management. Very sad, and he’s probably rolling around in the little  black plastic cylinder where (I imagine) they keep his remains.

            Can you imagine a company like GM saying “well, f it, our industry is getting smaller so lets just focus on professional, scientific, and fine arts markets that will also barely need us in 15 years”? 

          3. Hmm, maybe GM could have decided, “hmm, pollution and emissions are a problem, as is resource scarcity. But what do we make? Cars/transportation or engine holders? Maybe we should invest in new power plants for the cars we have and cars yet to come?” 

            But did they do that? And did they have to be bailed out by taxpayers, something Kodak never got? Unlike physical photography, personal transportation is not a shrinking market. You may want to find a better example. 

          4. The examples don’t matter. Industry is littered with companies that invented stuff they couldn’t sell or that became more valuable as parts or just a name (HP, Xerox come to mind). Some of it was bad decision making, some just the turn of the market. GM is a spectacularly bad one though: you can lay it all on decision making and institutional hubris. 

          5. Except for that digital photography has made huge inroads into those professional, scientific, and fine arts markets–even more, it may be safely said to have eroded some of the hard and fast distinctions between them and the consumer and amateur markets. Like, how many photojournalists shooting in difficult situations would use film today in 2011?

          6. I hardly consider “professional” (Marketing/advertising/fashion and photojournalists) the ideal market for film though. They really never were. They have generally cared more about speed than anything else, so it makes sense they’d go to digital first. Hell, some of Nikon’s first professional grade DSLRs were targeted at professionals (who were the only ones that could afford it anyhow).

          7. If I was selling a state of the art product with capabilities that amateurs had no use for but that I needed to recoup my costs, where would I look for a market? Professionals who can’t afford to cede any advantage to their competitors, no matter the cost, or who just want to have the newest thing for various reasons. 

          8. For them, it’s just another tool. They can choose which makes sense. The amateur/family archivist (you know here as Mom) is not going to bother with that. 

          9. “professional, scientific and fine arts market” amounts to squat in terms of actually making money from their product.

    2. This is false. Kodak as a brand was know for cameras but they had zero IP or competency in digital photography. Kodak did however have a massive amount of IP and expertise in chemicals. They were one of the largest chemical companies in the world and when cameras turned away from chemical processing, they should have stayed with what they knew: chemical manufacturing and development. They should have become a competitor to DOW and 3M. Instead they invested a massive amount of money into the digital realm, all because they thought their brand was strong enough to pull them through. I saw this whole thing play out when I worked for Eastman Kodak.

      1. I agree completely, this makes more sense than what I wrote. Point is: poor management lead to company with huge assets and powerful reputation failing.

      2. “zero IP or competency in digital photography”Other than inventing digital photography and marketing the earliest amateur and professional cameras, Inventing the DSLR,  and having most of the basic patents on digital photography not to mention making the chips for Leica and other high end cameras , I guess you are right.

        So what did you do at Eastman anyway?

        1. true enough but it wasn’t their strength, nor was their camera business the money maker. Look back at their ARs and you’ll see that the majority of their revenue and a larger portion on their profit was from film and processing. They spent a lot of money trying to maintain brand dominance in ‘cameras’ instead of looking at what they were good at. Hell, they sold their commercial print division in the late 80’s only to buy it back again (at a huge cost) in 2002(?). Good paper here: http://www.martinfrost.ws/htmlfiles/oct2011/What-Went-Wrong-At-Eastman-Kodak.pdf. There is also a great white paper that is mandatory reading as part of the Harvard MBA program (Gavetti, G., Henderson, R. and Giorgi, S., Kodak and the Digital Revolution (A), 2005, Harvard Business School)

      3. Kodak knew that digital photography was going to hurt their camera business back in the early 90s. They split into EK (Eastman Kodak) and EMN (Eastman Chemical) way back when. The latter, a chemical company is selling around $38 a share and paying dividends. I bought the parent company on rumors of the split. I even figured they had a chance, but wound up making my money on the chemical side and selling the camera/film shares roughly at what I had paid for them.

        The former could never get its act together with digital photography. For example, they offered Photo CDs made from your 35mm film reels. This would have been a great transitional technology, but they used an obscure format that no one supported rather than a simple raw format and JPEG which was just coming into popular use. They could have built something like Digital Darkroom, but they were locked into the chemical processing model.

        My first digital camera was a Kodak, and it wasn’t bad for its day. It even offered photo sharing online. Again, they were hurt because they didn’t understand the software aspects of the business. Their support software was clunky. It didn’t offer real asset management. My impression was that they made an effort, but it went against the corporate grain. They thought of the camera and accesories as the teaser and the money in film and processing, not the other way around. Like Detroit, it took a long time for them to “get” the new technology. In their case, too long.

  1. I totally agree. Kodak is now dying because of years of horrible corporate decision-making and lack of leadership. George has been spinning in his grave for a while now…

  2. The company that was already killed by digital photography was Polaroid, as they were after the same thing: instant pictures. People want pictures to share and as the internet came of age, people no longer needed or wanted a physical picture. 

    I hope Kodak’s film production assets are saved from destruction. A lot of us still use their stuff. It’s not like companies have stopped making film or cameras that use it. We have seen new film emulsions from Kodak and Fuji recently and Fuji releases cameras, thought it doesn’t make them. It’s the Mac vs PC pissing contest with film vs digital that we could do without. I use both, as appropriate. Wonder how many comments into this thread we get before someone goes off on one or the other option? 

        1. B&H carries D-76. HC-110 is where it’s at though :)

          Now is probably a good time to stock up on Tri-X, I guess. They already killed off Plus-X, and while they suggested that Tri-X is safe, that can only be true for as long as the company itself is afloat…

  3. I worked for Kodak in the mid-to-late-90’s.  The way that they did business was amazing.  On my way into the building I’d pass by guys who did NOTHING but read novels all day.  A few hundred feet farther I’d pass a big glassed-in clean room where the Chandra x-ray space telescope was being assembled.  It was classic company-so-big-nobody-knows-what-anyone-else-is-doing.

    1. I got to speak with him and some of his colleagues a bunch of years ago. Kodak is not failing because of the lack of ideas or very smart people. They were impressive.

  4. Apparently “its fortunes now rest on patent lawsuits” is a new way to paraphrase “sale of its digital imaging patents,” “potential buyers for its patent portfolio were cautious,” “They need to sell this portfolio, raise some type of cash,” and “filing for bankruptcy may actually end up boosting the value of a patent sale” — good to know.

  5. Sad, I guess… but Kodak was a company that had its core business in a very specific sort of applied chemistry. They were a chemical company marketing toward consumers, with infrastructure and facilities designed to supply half the world with film. Sure, some people still use it, and there’s still a business in making and processing 35mm film for hollywood, but that’s rapidly declining too.

    There’s probably no way they could have survived – photography is now a game for semiconductor manufacturers.

    Now we wait for the patent trolls to take over, skimming billions off companies that independently invented the same trivial extensions to digital computing. Kodak’s last act as a company will be rob every one of us of a few dollars every time we buy anything with a camera.

    1. Instant photography may be a game for the semiconductor makers. I expect someone will rescue the film products we still use, maybe a smaller Kodak film company. Just because it’s not in the impulse rack at the drugstore or that your one hour lab is closed doesn’t mean you can’t find and use new products that came out in the last couple of years. 

      The way I look at it, the camera is as old as the day it was made but I load a new sensor with each roll. Try that that your Nikon Dwhatsit ;-) 

  6. The article doesn’t say a thing about patent lawsuits. It talks about selling Kodak’s patent portfolio. The buyer could well be a company that makes digital cameras, such as one of the big 4(?) in Japan.

    1. The thing that scares me is not the death of T-Max, Ilford makes some good and cheapish film, it’s the death of D76. I have yet to find a acceptable developer that cheap…

      1. Sounds like something Maker-ish is needed.  60 years ago, photographers accepted that making your own developer was simple chemistry.  There were thousands of formulas out there and serious hobbyists would make dozens of different ones before deciding what they liked.

        As a kid in the early 1970s, I made up a few batches myself.  D76, though, was just easier to buy at the local FedMart so I stopped making my own developer after my curiosity was satisfied.  It was not difficult.  If I really needed D76 now, I could make some. 

        I expect that eventually someone will read some old photography magazines from the 1940s and 1950s, pull out a half-dozen easy-to-make formulas, make up a few test batches, and publish the results.  No doubt they’ll be lauded by the whole “let’s reinvent everything and pretend we’re pioneering geniuses” crowd as super-duper innovators.

        1. D76 is just Metol (monomethyl-p-aminophenol hemisulfate), Sodium Sulfite, Hydroquinone , and Borax. It’s pretty easy. 
          I used to make it but with less than the standard amount of Sodium Sulfite.

          Rodinal on the other hand…

          1. Rodinal is easy enough to get. Adox APH09= traditional formula Rodinal. Adox Adonal = 2005 Rodinal. You’re welcome. :)

            And D76 is pretty close to Ilford ID-11.

  7. Film vs. digital is not a pissing contest. It’s not a contest at all. Digital won.

    There are a few applications where film is superior, if one is willing to invest the time in learning how to do large-format film photography well. But even then it’s likely that film will be used to record the image in the field, and then the negative will be scanned for easy, sophisticated manipulation and repeatable printing.

    If the market never comes up with inexpensive large-format digital backs to replace sheet film, it will be because there’s not enough demand to make it worthwhile.

    1. Saying that because analog techniques weren’t used end to end means that “Digital Won” is silly. In fact, saying that there’s a large contest between digital and analog is silly. 

      Digital is sufficient for those who are either apathetic about overall quality and just want it online (consumers), or are under a lot of pressure to produce large quantities of acceptable quality, most of which will be displayed on mediocre mediums (most professionals). 

      For those who really care about the aesthetic and doing things well, it will be a while before film goes away, especially when it’s scanned on a nice high quality drum scanner and edited digitally (And for those who argue that you should use digital front to back because you’ll scan it anyways, I suggest you check the dynamic range ratings of film, digital, and drum scanners).

    2. Totally, it’s like talking about the “contest” between painting-draftsmanship and photography . . . in 1880. Newsflash, the camera was the victor, and the other arts went other ways.

  8. I was employed by Ampex (inventors of video recording) back in the late-80’s.  Ampex was for sale, and was visited by various suitors.  One of them was Kodak.  I recall overhearing one of the Kodak guys saying to another “maybe now we’ll figure out what the hell we’re doing”.  I could tell then that Kodak had completely lost their way (pretty much in parallel with Ampex, sadly enough).  

    The takeaway lesson is probably that companies founded on technical vision need to cultivate ongoing market vision in order to succeed.  Otherwise, they’ll end up throwing money at random projects (Ampex briefly tried their hand as a record label) that fail, and wind up just milking their patents (which accounted for 60% of Ampex’s income back then).

  9. The Kodak story is sad because 99% of their problems relate to BAD MANAGEMENT. They invested billions into digital photography and did some amazing trailblazing research but instead of embracing this disruptive technology, the management demurred. They essentially ignored the consumer digicam market and pretended film would last forever.  That’s why they have a huge patent portfolio and no market share. The had the tech but not the strategy. Sad :(
    This is an interesting analysis from HBS that we read in a class: http://hbr.org/product/kodak-and-the-digital-revolution-a/an/705448-PDF-ENG

  10. It’s really too bad, and not just for nostalgic reasons either.  I mean, I had a cheap little Kodak EasyShare camera that someone gave me and after I upgraded to the $600 Nikon, I realized the Kodak took far better pictures, especially indoors and low light.  The Nikon was much better outside in daylight, but most of my pics were of the kids inside, doing kid things like opening Christmas presents.   I see now that comparable Kodaks are about 80 bucks — right up there with the Coby mp3 players for low-end green(ish) tech that just works.  Get it while you can!

  11. Kodak is a poster-child for how to destroy an American institution… basically the failures of Corporate America from the 80s into today.

    They were way back in the day a fantastic company that everyone wanted to work for.  They tended to be very smart and innovative, but as the attitudes of American businesses changed in the 80s, so too did Kodak.  They seemed to have an insular business climate that was fine letting other companies out innovate them and instead settled for letting their momentum and their lawyers guide their moves instead of their engineering and design departments. 

    The failure of Kodak should be a wake-up call to many other businesses, but alas few people or companies learn from the past, and instead we are doomed to repeat those mistakes. 

    1. I think a big part of the problem is that Kodak abandoned all of their niche markets in the 80s, without realizing that pretty soon all their business was going to be a niche market. I switched to digital in large part because Kodak (and Agfa) discontinued all the materials I was using by 1990.

      BTW , anyone who knows a source for 70mm B&W film with type 2 perforations.

  12. I guess the obvious take-away from this thread is that if the board of Kodak had any brains at all, they would have understood that to save their company all they had to do was come to boingboing and hire any one or two of the 50 or so industry experts posting above, who would have saved the company with one hand tied behind their backs. They probably didn’t realize it could be so easy!

  13. Kodak and Polaroid seem to have the same issue:  huge global production lines with millions of products being sold for years being reduced in scale.  Smaller sums of money for the existing product with existing tooling and manufacturing processes just aren’t worth it.

    Polaroid sold it all to the Impossible Project, who is cranking out film as fast as the can and making innovations in the product at the same time.

    Kodak may just hand the reins over to Fuji or Ilford as well since there’s just not enough money in it for them to meet their current standard.  Hiring experts isn’t the issue, it’s more about “do we shutter some plants and keep a boutique line or just shutter them all and call it a day?”

    1. Fuji has been killing off their film line just as Kodak has. We lost Neopan 1600 this year.

      Harman has a fairly complete lineup in b/w, but nothing in color. Kodak has some nice recent color film developments (the new Portra line, Ektar, E100), and these could be valuable. Unfortunately Harman has an equivalent for every Kodak b/w product — HP5+ for Tri-X, FP4 for Plus-X, Delta for TMAX, XP2 for 400CN — and then more — the Kentmere films for low-cost b/w, PanF+, SFX… 

      Efke/Adox/Maco/Rollei/whatever deal in a small line of fairly niche emulsions. I doubt they could afford license to, or even desire to pick up Kodak film. 

      Foma has a small lineup of budget traditional emulsions. Similar situation to Efke/etc…

      All a shame, because nothing else available now is quite like Tri-X. I’ll opine similarly once Fuji starts doing worse and Acros is threatened… 

      1. In truth, Tri-X isn’t really like Tri-X anymore… and I’ve never been able to befriend Ilford’s film.

        Be that as it may: I concur with the hope that Kodak will at least licence the b&w emulsions. Film/digital pissing contests be damned: I know that digital is “better” for many applications. But I happen to like the craft of working in the darkroom. My prints are hand-made, with love and old equipment. From an artistic point of view, to me the “how” is just as important as the result.

        So if someone decided, à la Impossible project, to pick up the recipe for original-strength Tri-X and coats it on film at small scale, yeah, I’ll buy a couple of hundred. In the meantime I’m stockpiling yellow boxes.

        1. Current Tri-X might not be old Tri-X, but it’s still (in my opinion) the most amazing film on the market. So forgiving, easily pushed/pulled 2 stops, and with pleasing grain. It’s not my favorite film to shoot, but it is quite magical. I always throw a roll in when I’m Super-Savering on Amazon.

          As for Ilford, PanF+ is a beautiful film, even if nothing else they make really captivates me. They’ve been pulling some crazy pricing tricks on HP5+ lately, though (2 for the price of one, 3 for the price of 1.5) which has led to me shooting a considerable amount of it. When, really, I guess I should be supporting Kodak instead…

  14. Having worked in camera sales/pro-photo labs for a while I’ve long been of the opinion that if anything was killing Kodak it was Fuji. I mean in every possible aspect of the business Fuji was doing similar things to Kodak, but doing it right. Cheap,  functional, durable cameras for the consumer market? Yeah Fuji’s were just better cameras. Interesting pro-grade camerasa good price point? Kodak didn’t seem to be even trying. Strange little enthusiast cameras (again cheaper than most other brands and still competative)? Kodak never even got there. Even on the film/chemical end of things Fuji was kicking their ass. Larger, more widely available, and more varied product line at a much better price point. Even our lab equipment and chems (especially digital printers and auto-labs) were Fuji made. They just worked better at a better price, did a better job of integrating digital, and were far more reliable than what Kodak was pushing. 
    As hazdaz put it above Kodak just descended into classic American corporate  bureaucracy. Fuji still revolved around engineers, photographers and chemists. You could even see it in their sales rep. The Kodak reps were like rejects from a telemarketing firm. They knew nothing about any aspect of the business, or even their own product line. Ours in particular had a huge problem with personal hygiene.Our Fuji reps on the other hand were a former engineer and a retired press photog.They’d show up with a couple of cameras (even unreleased ones) to play with. And bring gifts for the staff. They knew I liked slide film so they’d bring me samples of stuff the store didn’t carry. Hell the one guy went to my manager’s wedding. 

    So even then (7 years ago or so) Kodak had lost or seriously cheesed off the entire back end of the business. The labs, pros, artists, press and what have that could have saved them. And they were just starting to seriously fuck up the digital end of the business. I had that same nostalgic pro-America love for Kodak as most people when I started at that place. Within 3 months (and ever since) I had a serious hard on for Fuji and wouldn’t touch Kodak with a 10 foot pole. 

    1. True that, even if they are discontinuing lines of film hopefully it will be so they can continue with others. In a time where the only innovation seems to be in mirrorless cameras Fuji are continually putting out new and innovative stuff, even new film cameras – and they are being rewarded by this. The success of the X100 says as much.

  15. “…a sales model based on selling cheap cameras and expensive media.”

    Sounds like the exact same model where companies sell ink jet printers cheap and then sell expensive ink.

    1. They tried, that was one of the hallmarks of the “easy share” brand when they first launched it. Any Easy Share camera could plug directly into any Easy Share Printer without cables, and the software let you upload directly to the Easy Share website for public albums and print services. Unfortunately every step of it was poorly designed. The site was unusable, prints were overpriced and no better than the self printing machine at Walmart. The printers were clunky and low quality, most only printed on a single size of paper, and the docking system was so clunky you’d be lucky to get a camera to seat properly. Meanwhile multiple other online print services were doing it better and the rest of the industry was going with Pictbridge and blue tooth.

      Even at the start most of their marketing was based on how cheap it was to print things at home with a Kodak printer. I think it was $.85 a print for most printers at the time. Kodak was something like $.65 a print. Our 1 hour photolab printed thing for $.34 and most of the internet/mail guys were doing it at between $.25 and $.10 a print. 

  16. Poor planning in hindsight – absolutely. But as I understood it, the rough plan was to roll with the transition to digital in the developed markets, and continue to supply film to the third world markets which would stay there longer and transition slowly because of the high cost of switching to digital. And – yes, stay with film in the niche markets like large format and x-ray.

    There are other factors that make this seem logical. The modern digicam lives from batteries, but a Pentax K1000 with a 36 exposure roll can sit  in a closet for two years and be ready to go in an instant when you take it out. Battery? Yes – but only for the meter, and most shots can be done acceptably with a few simply exposure rules. The lack of a broad and solid battery and power infrastructure in the third world should – by this vision – slowed down the digital transition.

    What destroyed this plan was the third world skipping over film entirely, and going straight to digital. This was likely helped along considerably by the cell phone market, which rapidly took over the cheapest digicam markets. When the camera moved from being a $100 item to a $5 option, people find a way to adapt to the other changes.

    Ultimately, I’d say Moore’s law had the most to do with destroying Kodak. But even that could have been hard to see – the optics and mechanicals aren’t part of that equation.

    But Kodak did deal in low-cost film point and shoots, though, so they should have known just how little it costs to make a camera body and inexpensive lens. Pair that with the plunging cost of the digital guts, and maybe, just maybe, someone could have seen the light.

    But at the end of the day, Kodak was a process and chemicals company. The market was shifting to a place where you could create photographs and memories without process and chemicals. It takes a very tough minded company to admit that the future does not hold a place for them.

  17. Is not death the ultimate expression of corporate personhood?  Beware, ye who seek to be fully human.

  18. Should a corporation seek to prolong its existence once its reason for being is gone?   IMO, no.  A corporation is a tool for a purpose–once that tool is no longer needed it should be discarded.

  19. What surprises me is that somehow Kodak film keeps lingering here in Hollywood.  I mean, yeah, plenty of features still shoot on Super 35, but when I was working on Will & Grace I was surprised that NBC Studios didn’t eventually make us switch to HDCam instead of film.  And now, five years later, I’m still working on a TV show that shoots on film.  A 64-minute piece of HDCam stock costs us in the neighborhood of fifty bucks, but an hour’s worth of footage on film?  The raw stock costs us $0.58 per foot, the processing is $0.09 per foot, and the telecine is $300 per hour, so putting a 42-minute episode together costs us in the neighborhood of $60,000 in raw film stock, $7,000 in processing, and $20,ooo in telecine.

    Some producers and directors still insist on film, even for TV shows, but every year I’m more amazed that the studios let them get away with it in these tight-budgeted times.

  20. Ofoto killed Kodak… I was all ready to continue my life long Kodak connection when our house went to digital.  The product was over priced and hard to navigate…. and so it goes.  Snapfish and Walmart won.

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