Xtol's Controversial Start
Almost as soon as Xtol came out, photographers in Internet forums started reporting problems with it. It was hard to dissolve in water and would sometimes lose its strength suddenly without turning brown or giving any other warning.
Simultaneously, other photographers got excellent results and found that Xtol was everything Kodak claimed for it.
Users report that the failures are sudden. The developer does not gradually get weaker in storage. Instead, one day it works and the next day it doesn't. Further, most of the failure reports seem to involve Kodak T-Max 100 film.
By 2001, Kodak had tracked the problem to two sources.
(1) The small packets of powder, to make 1 liter of solution, were not adequately sealed to keep out air and humidity - or perhaps there was just too little powder in them, in proportion to the air that would inevitably get in. As a result, the powder would cake and become hard to dissolve, and the life of the developer would also be impaired.
(2) Xtol performed poorly at high dilutions (1:2, 1:3) in water of varying quality.
After making several attempts to improve the 1-liter packets, Kodak finally discontinued them altogether; the smallest size of Xtol that you can get is now 5 liters. Also, Kodak stopped publishing developing times for Xtol at dilutions higher than 1:1 (but see below).
Update: As of March 2002, Xtol is simply disappearing from the shelves of many camera stores that stock other darkroom supplies. Apparently, by discontinuing the 1-liter packet, Kodak effectively took Xtol out of the amateur and small-darkroom market; they continue to promote it in 5- and 50-liter packets for use in processing machines.