Kodak: the Debacle and the BS
By now, you must have heard that Kodak has filed for bankruptcy. All the noise from the web is that Kodak is a bankrupt company because, although they invented many of the digital technology, they were not nimble enoughâ€¦ Those are mostly people that repeat what everybody else copied from the web. The problem is that these people don't have a â€œlong enoughâ€ memory. Kodak's problems started long, long before the digital area.
What The Duck has this great cartoon about â€œKodak's deathâ€
Here are the 3 main events that caused â€œKodak's deathâ€:
- 1972, Kodak introduced the 110 film format http://en.wikipedia.org/wiki/110_film. The 126 format cassette introduced in 1963 was very successful, a square version of the 35mm film in a cassette for easy handling. So Kodak decided to â€œscrew the customersâ€ with the 110 format by charging almost the same the price as the 126 but for a third of the film. The quality of the 3Â½â€ by 5â€ prints was not good (I don't remember 4â€ by 6â€ existing.) Customers that bought a 110 camera never bought another one, they usually upgraded to a cheap â€œpoint and shootâ€ film camera.
1982, Kodak introduced the disc format: http://en.wikipedia.org/wiki/Disc_film. Kodak charged the same price for that disk as for the 24 exposure 110, but the negative was only a third of the size of the 110 film. The quality of the 3Â½â€ by 5â€ prints was quite bad. Most people didn't buy these cameras, these were mostly presents and the users quickly changed cameras to non-Kodak cameras.
The processing labs, industrials or 1-hour, didn't like it, they had to buy new processing equipment. Many (I would say the majority) 1-hour photo labs refused to spend the extra $80,0001 for a new Noritsu2 processor.
1982, Kodak said to the world: â€œWe are Kodak, and we are not paying!â€ The US got their first summer Olympics for 1984 in Los Angeles since 1932. Kodak had been the official â€œphotography sponsorâ€ since the beginning of the sponsorships and had many unofficial deals long before the sponsorships. So a small upstart company got the contract: Fujifilm.
Kodak was forcing dealers into minimum volumes if the dealers wanted to keep their Kodak licenseâ€¦ In 1984, Fujifilm got all the exposure of the very successful Los Angeles Olympics, many dealers dropped their Kodak license and started to sell Fujifilm. Fujifilm had fantastic color film, their B&W films were definitely below par, but only some professionals and camera clubs were buying B&W film by then. Which is why most of the small 1-hour photo labs dropped the Kodak chemicals and paper and switched to Fujifilm.
Everybody, on the business side, â€œhatedâ€ Kodak. Kodak was extremely difficult to deal with. Only the press liked Kodak. Many people were cheering each time Kodak would stumble.
Kodak started â€œto go down the drainâ€ long before the digital world. By the late 70s, Kodak & Polaroid represented 80+% of the film, paper and chemical, not just US but for the whole world. By the mid-1990s, Polaroid was already moribund and Kodak well below 50% of the world's film, paper and chemicals. That was just the beginning of the small point and shoot digital cameras, the Sony Mavica was just under $1,000. By 1995, Kodak was already 30% smaller than at its peak, the late 70s.