Kodak Reports 1.03 Billion Dollar Loss for 3Q

[Bertram2]

whenever I like a film of theirs, they do one of three things:
1. Discontinue it.
2. Rename it.
3. Mark it for export only.
--Peter

Peter,
my POV is that digital did not fall from heaven, but was invented to generate a new film and photo business, which had no essential growth any more in those days..
Once having made their decisions "of what the future is" Kodak was one of many large companies in photo and film biz who pushed the change to digital hard !
To accelerate the growth of the new market it is helpful to destroy the old one as fast as consumers allow you to do so, or even a bit faster.

If Kodak now has probs with reduced revenues it must have something to do with the simple fact that they were not sucessful ebuff in getting the planned share of the new market, while the downfall of the traditional products is going on as they planned it.

It is like Goethe's Faust: "die Geister , die ich rief... !!) , yes the ghosts they called are getting outta control, a management prob, they all forgot what a long time strategy is but stare at their quarterly revenues like in coma ! They wanted the cahnge to fast and thought a bit manipulation would help.

How the old analog market is partly dried out intentionally and destroyed and devasted by boards, which are driven only by big stockholders and investment fond managers, THAT is what I find the most annoying thing in times of digital imaging, the way how consumers get pushed in the "right direction". 😡
It's this kinda manipulation i hate, not because the pics look so strange ! 😀

Our answer should be as militant as their strategy is: Don't buy film from a company, which tries to keep you away from their film products and has no clear public commitment for a future film support. Thus you help to kill the others, who still keep up their complete film portfolio. That's all WE can do to keep film beeing a not too small (and expensibe !) niche in futuure.

Regards,
Bertram
AGFA btw was killed in the same way, from the same reasons.

 

[bmattock]

Peter,
my POV is that digital did not fall from heaven, but was invented to generate a new film and photo business, which had no essential growth any more in those days..

I know we frequently disagree, and I guess this is no exception. Sorry!

I am a paranoid person - I know that about myself. But even I do not think that Kodak plotted to create a digital camera in a market which did not want digital cameras and then intentionally forced consumers to buy them by killing off film products.

To do so would require a massive cooperation between all the makers of film cameras, the large and the small, and the makers of photographic film - and these are competitors, not a co-op. It just didn't happen.

Yes, digital film technology did not "fall from heaven," it was invented with the hopes that people would want to buy it. And yes, it was "invented to generate a new film and photo business" and why not? Computers were invented to generate a new business. Cars were, air conditioning was, and so on, ad infinitum. Did you suppose that the demand for these things was instant? No, it took time before the products were made such that people wanted to buy them.

Technology is market-driven. Many new technologies are brought to market with the hope that they will sell. And many fail to sell because the public has no interest. Companies invest money into R&D with the hope that they will be able to recoup some of their investment by introducing new products that the public will purchase.

In a market economy, the market drives corporations, not the other way around.

So Kodak puts some early R&D into digital imaging. And their first few products generated some interest, but not a huge amount. They go back to the lab and work on it some more. Other companies license Kodak technology and patents and do likewise - thinking they might have a better concept than Kodak does - or they invent their own digital imaging technologies and go head-to-head with Kodak.

But all of it is dependent on acceptance by the public. If no one buys the stuff, then it is a failure.

You say that film was withdrawn despite the fact that the public prefers it. That's silly - the simple fact is that the public does NOT prefer film. The public gets what it wants - if they wanted film, they'd be making a stink about how hard it is getting to find film, and film would come roaring back.

You say that Kodak somehow forced the public to buy digital cameras in place of the film cameras they could no longer buy. And how did Kodak force all their competitors to go along with this scheme?

People buy digital cameras because they want digital cameras. It really is that simple. Technology marches on, deal with it.

Our answer should be as militant as their strategy is: Don't buy film from a company, which tries to keep you away from their film products and has no clear public commitment for a future film support. Thus you help to kill the others, who still keep up their complete film portfolio. That's all WE can do to keep film beeing a not too small (and expensibe !) niche in futuure.

You can buy or not buy film as you wish, of course. I suspect that what you buy or boycott won't affect anyone.

But the film companies do not hate their customers - they are driven by their customers. More of their customers want digital cameras than want film cameras, and they seek to exit a market that is costing them money as quickly as they can - because they have a fiduciary responsibility to their stockholders. In fact, to ignore profit for the sake of supporting film, depending on how it is done, could even be considered criminal.

Best Regards,

Bill Mattocks

 

[zeos 386sx]

Peter,
my POV is that digital did not fall from heaven, but was invented to generate a new film and photo business, which had no essential growth any more in those days..

If Kodak now has probs with reduced revenues it must have something to do with the simple fact that they were not sucessful ebuff in getting the planned share of the new market, while the downfall of the traditional products is going on as they planned it.

Our answer should be as militant as their strategy is: Don't buy film from a company, which tries to keep you away from their film products and has no clear public commitment for a future film support. Thus you help to kill the others, who still keep up their complete film portfolio. That's all WE can do to keep film beeing a not too small (and expensibe !) niche in futuure.

Some of the earliest adopters of digital cameras were news photographers who transmitted pictures via telephone to wire services. They had a very valid reason to adopt digital and they weren't forced to use it. The digital cameras then were in the $30,000 a camera range.

Kodak's major problem is a $900 million tax burden put on them because of restructuring - not lost film sales. As far as film is concerned, Kodak underestimated, like everyone else, how quickly digital would be adopted by the general public. Their solution is simple - maintain profitability by layoffs and plant closures.

bmattock is correct. Trying to boycott Kodak would be useless and probably detrimental to your stated end - the preservation of consumer film lines. Kodak is a widely diversified company and film is just becoming a smaller and smaller part of its product/service portfolio. Boycotting Kodak would just cause the plants to close faster and more people to be put out of work. It would also make it harder to find film or film development and cause more people to jump to digital.

 

[RJBender]

Maybe Kodak assumed they would be number 1 in digital because of their reputation with film. I don't think they imagined they would have all the competition they have today.

Their digital cameras designed for pros that sold for several thousands of dollars 5 years ago are now worth maybe 1/10 of what they sold for new. If you bought a Kodak pro digital camera then, would you buy another one now?

For example, I saw a mint Kodak DCS620X at a photo equipment retailer's a few months ago for $800.


R.J.

 

[bmattock]

Maybe Kodak assumed they would be number 1 in digital because of their reputation with film. I don't think they imagined they would have all the competition they have today.

It is hard to know what was in the corporate mind, but although I feel strongly that Kodak is on the right track now, I believe they pulled some real boners in the last decade.

There's an interesting news story a few weeks ago about the fellow who worked for Kodak to produce the first digital imager. This was twenty some odd years ago, maybe longer (sorry, can't find the article now). Kodak had the early inside track and decided it had no real market, so shelved it for a long time.

They also didn't really know what they wanted to be in this market - a supplier of imagers and technology to camera companies? A direct producer of professional kit? A retail provider of amateur and hobbiest cameras? They played around with wearing several different hats and it cost them.

However, they did keep up the R&D and hold a lot of very nice patents and technology that they license to others, and they seem intent on working that angle and now they want to have a piece of the retail market pie - they have recently exited the pro DSLR market.

Their digital cameras designed for pros that sold for several thousands of dollars 5 years ago are now worth maybe 1/10 of what they sold for new. If you bought a Kodak pro digital camera then, would you buy another one now?

Nope, but at the time, they were the only game in town.

For example, I saw a mint Kodak DCS620X at a photo equipment retailer's a few months ago for $800.

I've seen some of the early 1.5 MP DCS series cameras going for $100 or less on eBoy recently. I have no idea what one would use one of them for, but they do sell at that price point.

Kodak was an early market leader - they took a lot of the risks and they made a lot of mistakes finding out what the market wanted to buy. They could not make up their minds what they wanted to be in this new market. Bad choices, loss of momentum, mis-reading the market. They shuffled some management. They made some investments in film technology that cost a billion or so that maybe now they wish they hadn't, although the B&W film modernization turned out to be a brilliant move in retrospect.

And like ALL of the major camera producers, as you said, they severly underestimated the speed of adoption of digital cameras by the market.

I can understand - no fundamental technology shift has EVER happened so fast. Prior technology drives have always taken longer, and all the research (and hence, the 'smart money') pointed that way. Computers, pagers, cell phones, fax machines, laser printers, color inkjet, and so on.

However, one thing they missed - the TREND in market adoption of technological consumer devices has been towards a sharper steeper curve, especially at the attractive price points. Each new tech introduction that finds a foothold gains moves from early adopter to commodity item faster than the last. Pagers took years to become ubiquitous - Blackberrys took a year. Industry analysts who missed that (and that was all of them except me) should be horse-whipped.

The market now moves in a fluid motion. It's Veni, Vidi, Vinci and get on with the show, bub. There is very little time for hesitation - companies need to get in or get out and do it fast, or the competition eats their lunch. In this case, the huge and moribund camera koritsu were saved because they were all pretty much equally stupid and slow-moving.

If any of them had acted quickly, blasted their their top management into low earth orbit and hired some new blood, made some team-ups with companies like Intel, Motorola, Hitachi and so on, and geared up towards digicams, they'd own the market and that would be that. Sony nearly did it, but as usual, they wanted the market by way of proprietary technology and consumers are wary of that. Betamax, Minidisc, and Sony Memory Sticks. Idiots.

I tried to tell everyone that consumers were eager to buy digital cameras that met certain minimum standards - I could feel the groundswell out there - but no one listened.

It's deja vu all over again. Consumers like instant, and they don't like fussy, and they do like technology, and they don't like expensive. Quality? Not such a big concern. They care, but it is well down on the list. Speed? Yes, that's important. Ease of use? Definitely. And so on.

Kodak understood this once, long ago. "Press the button, we do the rest." They had the zeitgeist nailed perfectly. Surprise, that's where we are again. And Kodak gets that now. That's why they have just introduced the new WiFi capable cameras. Take the photo and email or print it directly from the camera while in the field. The only thing easier is cell phone cameras...ooops. Guess they didn't get it 100%, then.

All the enthusiast arguments against digital are true - and none of them matter at all. Film *is* superior to digital for most applications at this point in time - digital has certain advantages in compromise situations. So what? The public doesn't care, and the public has the power. The public wants digital cameras.

Best Regards,

Bill Mattocks

 

[zeos 386sx]

no fundamental technology shift has EVER happened so fast.

The shift from LP records to CD's?

 

[bmattock]

The shift from LP records to CD's?

Not so quickly as the shift from film cameras to digital cameras.

The automobile started the trend in speeding up consumer adoption of technology, or perhaps electricity if you like - all before my time, anyway.

But the big shift came with the personal computer. That's when consumers began their incessant demand for more, faster, better, cheaper. Adoption rates began to become steeper curves. Manufacturing techniques (ironically aided by CAD and statistical modeling) had to catch up to enable manufacturers to be able to provide goods faster and still at a profit - margins shrank on a per-unit basis.

Of course, the markets generated their own obsolecence rates - for a change, the manufacturers did not have to convince consumers that what they bought last year was no good anymore - consumers supplied that impetus themselves, and continue to do so.

Each new technological introduction has had a shorter run-up from market introduction to adoption to saturation - markets are mature in a year or less now, and woe to the manufacturer who can't move at least that fast.

Look at the DSLR market. Except for a few models at the top, new consumer/enthusiast models have to be introduced about twice per year - trending towards three times per year. Fail to do that and become irrelevant in a market that produces roadkill at an astonishing rate.

The digicam market is even more chaotic. The drive there is to more megapixels, higher optical zoom, bigger LCD screen, and to a lesser extent, more battery life, smaller size, faster shot-to-shot response time. Manufacturers struggle to differentiate in a market where they're all about the same right now - but it doesn't matter, they've got to shovel that crap out there or they're all done.

The market will mature, it will saturate, it will slow down. But not yet, it's red-hot. If the technological innovation continues to move ahead with alacrity, the saturation point can be held off for awhile longer yet.

Best Regards,

Bill Mattocks

 

[zeos 386sx]

I tried to tell everyone that consumers were eager to buy digital cameras that met certain minimum standards - I could feel the groundswell out there - but no one listened.

I've been suggesting that we still have not hit what the market considers "minimum standards". I think we may be getting close with the Canon 5D which is selling very quickly. I agree that there is room to grow.

 

[jrong]

*gasp*... are you saying.. the public are really superficial and shallow?? 😉

 

[bmattock]

*gasp*... are you saying.. the public are really superficial and shallow?? 😉

Surprising as it may seem!

"The peasants are revolting"

"You're telling me, they stink on ice!"

Mel Brooks knows everything!

Best Regards,

Bill Mattocks

 

[bmattock]

I've been suggesting that we still have not hit what the market considers "minimum standards". I think we may be getting close with the Canon 5D which is selling very quickly. I agree that there is room to grow.

I think we're talking about different markets. The 5D is clearly not aimed at Joe Sixpack. The market I'm talking about is the bulk of the market, which was once happy with a Kodak Instamatic.

Minimum standards for that market include the ability to print 4x6 at a quality level that resembles Kodak Gold 400 at the same print size.

Best Regards,

Bill Mattocks

 

[RJBender]

It is hard to know what was in the corporate mind, but although I feel strongly that Kodak is on the right track now, I believe they pulled some real boners in the last decade.

Like the time they picked Dennis Rodman to promote a new APS camera. I remember the advertisement in which Rodman promises to be good so he'll get a new camera for Christmas. Soon afterwards, Rodman got some bad press for kicking a cameraman in the groin.

R.J.

 

[zeos 386sx]

I think we're talking about different markets. The 5D is clearly not aimed at Joe Sixpack. The market I'm talking about is the bulk of the market, which was once happy with a Kodak Instamatic.

Minimum standards for that market include the ability to print 4x6 at a quality level that resembles Kodak Gold 400 at the same print size.

The 4x6 market is saturated with acceptable cameras. The only markets left in which to develop are the midrange and high-end markets.

 

[Peter Klein]

I tried to tell everyone that consumers were eager to buy digital cameras that met certain minimum standards - I could feel the groundswell out there - but no one listened.

Bill Mattocks

Bill: I think I read about you in Homer's Illiad. Something about "Beware of Geeks bearing GIFs. . ." 😀

Seriously, though, I think the market is more manipulated than you do. With every magazine trumpeting to the skies that you gotta have the latest digital camera or go the way of the Wooly Mammoth, people are influenced.

This doesn't mean that consumers don't "want" certain things. And if they accepted lousy film P&S quality from the 1-hour photo lab, they will accept slightly lousier quality from the digital kiosk. Especially if they can easily email Junior's washed-out baby pictures to Aunt Ethel in Erie. But I do think that they were trained to want certain things. Marketing has a lot to do with it.

--Peter

 

[Bertram2]

Seriously, though, I think the market is more manipulated than you do. With every magazine trumpeting to the skies that you gotta have the latest digital camera or go the way of the Wooly Mammoth, people are influenced.

This doesn't mean that consumers don't "want" certain things. And if they accepted lousy film P&S quality from the 1-hour photo lab, they will accept slightly lousier quality from the digital kiosk. Especially if they can easily email Junior's washed-out baby pictures to Aunt Ethel in Erie. But I do think that they were trained to want certain things. Marketing has a lot to do with it.
--Peter

Peter,
that's exactly the way they "make" their market. I stopped buying photo magazines here in Germany, not because they ALL talk amost exclusively about digital cameras only, but because they are obviously pushing a message, as you described it.
And their reports are not honest, they try to hide the weak points in such an obvious way or talk them down in a way which is ridiculous.
Worst are the P&S tests, they put up a matrix for example with ratings for noise and each camera gets a rating, but the sample photos are thumbnails only and so you cannot really SEE what this noise would mean for your result on a print. Ratings yes, but but visualization. And the people eat that crap !!
Same release delay : 3 years ago many P&S had delays of a whole second, they said it , gave a rating relative to the other brands but did NOT comment that as beeing useless junk, tho nobody can take a photo with a release delay of a second or even more !
Same colour reproduction. They put thumbnails side by side and even at this size some look as a film developed in a Havanna minilab. Again this is rated relative to each other but not commented as what is is : Useless crap !

The manipulation trick is the RELATIVE comparison: Compare bad with worse and sell it as a product information.
Strange but true: At film scanners they always remember what a test really is and their information can be considered as something like a product info.
I would feel like an idiot spending $6 for a magazine which tries to manipulate my decisions.

Right now I have to decide about a digital P&S for my son, but I haven't read any tests. I take a model which a 99% film shooting friend has recommended as relatively the best in my budget limit , he uses it for Ebay and he sent me some 500X750 samples which confirmed his rating and so I am sure to get what I expect to get for my money.

Regards,
Bertram

 

[RJBender]

Peter,
that's exactly the way they "make" their market. I stopped buying photo magazines here in Germany, not because they ALL talk amost exclusively about digital cameras only, but because they are obviously pushing a message, as you described it.
And their reports are not honest, they try to hide the weak points in such an obvious way or talk them down in a way which is ridiculous.
Worst are the P&S tests, they put up a matrix for example with ratings for noise and each camera gets a rating, but the sample photos are thumbnails only and so you cannot really SEE what this noise would mean for your result on a print. Ratings yes, but but visualization. And the people eat that crap !!
Same release delay : 3 years ago many P&S had delays of a whole second, they said it , gave a rating relative to the other brands but did NOT comment that as beeing useless junk, tho nobody can take a photo with a release delay of a second or even more !
Same colour reproduction. They put thumbnails side by side and even at this size some look as a film developed in a Havanna minilab. Again this is rated relative to each other but not commented as what is is : Useless crap !

The manipulation trick is the RELATIVE comparison: Compare bad with worse and sell it as a product information.
Strange but true: At film scanners they always remember what a test really is and their information can be considered as something like a product info.
I would feel like an idiot spending $6 for a magazine which tries to manipulate my decisions.

Right now I have to decide about a digital P&S for my son, but I haven't read any tests. I take a model which a 99% film shooting friend has recommended as relatively the best in my budget limit , he uses it for Ebay and he sent me some 500X750 samples which confirmed his rating and so I am sure to get what I expect to get for my money.

Regards,
Bertram

Gone are the days when photography magazines would completely disassemble a camera and give you a 5 page review. :bang:

Bertram, this site not only has tests and specs but sample images you can download 😀 :
http://www.dpreview.com/reviews/default.asp?view=alpha

I'm sure you can find the right camera for your son with this information.

R.J.

 

[G2Fan]

Since when did it get hard to find film ?

G2Fan

 

[RJBender]

Kodak was an early market leader - they took a lot of the risks and they made a lot of mistakes finding out what the market wanted to buy. They could not make up their minds what they wanted to be in this new market. Bad choices, loss of momentum, mis-reading the market. They shuffled some management. They made some investments in film technology that cost a billion or so that maybe now they wish they hadn't, although the B&W film modernization turned out to be a brilliant move in retrospect....

Kodak understood this once, long ago. "Press the button, we do the rest." They had the zeitgeist nailed perfectly. Surprise, that's where we are again. And Kodak gets that now. That's why they have just introduced the new WiFi capable cameras. Take the photo and email or print it directly from the camera while in the field...

Bill, I think we're being played. 😡 You may not remember these new and improved film formats Kodak gave us in the past:

1963: 35mm film in a convenient, drop in plastic cartridge AKA 126 film. Wonderful stuff if you don't like your film laying flat. 🙂
1973: 16mm film in a convenient, drop in plastic cartridge AKA 110 film. Great stuff if you like grainy photos. Film pressure plate? Who needs it? 🙁
1982: "disc" film. Wonderful format because it's so convenient to use. Picture quality? 😕 Ahhh who gives a s***. :bang: Convenience is more important. 😱
1994: APS. Really cool panorama format created by cropping the existing 35mm format. 🙄 And more $$$ for the labs to process the stuff. 😀

Do you see a trend here? Invent a new film format. Sell cameras designed for that format. Then come out with another format several years later. 😛


R.J.

 

[Bertram2]

Do you see a trend here? Invent a new film format. Sell cameras designed for that format. Then come out with another format several years later. 😛
R.J.

RJ,
thanks for the link, I'll go there and check it out.

Related to the format question:
It is an old story that when markets with products based on a technical standard get too narrrow, one tries to introduce a new standard to get out of direct price and performance comparisons.
This is called a system sale , in this case you buy a camera as a link only to a (expensive) proprietary film format. the challenge always was to make people burn film, as much as possible. The Agfa Box and the Brownies in US were build and sold only for that purpose, a cheap entry in a consuming system.

The promise always was convenience indeed, it's price was a loss of quality. But changing the standard again and again never worked in the 35mm world. which was itself a new standard once and had taken time to establish itself aginst the 120 roll film.

An essential part of my education had been to learn the question "Cui bono ?" which is Latin and means you always have to check whose interest is behind an offer, an opinion or a demand !
Helpful in politics and but also for making a decision about what pic-taking-system is best for me.

Complaing about consumer manipulation you always get the hypocritical answer that we are mature ctizens and consumers and can decide ourself well what is good for us .
But if you really do so they call you a grumpy old sourpuss, an know-better and smart ass who has fun with spoilin' the party of those who want to contribute to the "progress". 😀

Take care ! 😉
Bertram

 

[bmattock]

Bill, I think we're being played. 😡 You may not remember these new and improved film formats Kodak gave us in the past:

1963: 35mm film in a convenient, drop in plastic cartridge AKA 126 film. Wonderful stuff if you don't like your film laying flat. 🙂
1973: 16mm film in a convenient, drop in plastic cartridge AKA 110 film. Great stuff if you like grainy photos. Film pressure plate? Who needs it? 🙁
1982: "disc" film. Wonderful format because it's so convenient to use. Picture quality? 😕 Ahhh who gives a s***. :bang: Convenience is more important. 😱
1994: APS. Really cool panorama format created by cropping the existing 35mm format. 🙄 And more $$$ for the labs to process the stuff. 😀

Do you see a trend here? Invent a new film format. Sell cameras designed for that format. Then come out with another format several years later. 😛

R.J.

Sure, I remember them - I'm 44 years old! As well, I remember 127 roll film. And of course there have been others - one of the worst was the 120/620 rollfilm thing.

I can't defend that - Kodak was behaving like a razor-blade company - obsolete the old by creating a new format and persuading the public that it really WANTS the new format. And as a monolithic producer of both cameras AND film, they had the advantage of being able to force the markets to move the way they wanted them to. That's not nice behavior, is it? And why did they do it? Greed, of course. They wanted to be a sole supplier and destroy their competition, or at least steal market share while their competitors were forced to retool and play catchup.

And if Kodak were doing that now, then Bertram would be correct. But for it to be true in this case, Kodak would have to a) be a monolithic controller of the digital market or b) be involved in a massive criminal conspiracy with hundreds of film and digital camera companies. I believe neither is true. Bertram obviously disagrees.

Why is this not true - especially since Kodak has a history of doing this type of thing?

Well, look at Sony. They have tried on many occasions to take a page from Kodak's book - it doesn't work in the electronics technology field. MiniDiscs? Betamax? Sony Memory Sticks? Sony would love to drive the market, but the fact is, they don't. They invent proprietary formats and end up being the only ones who use them, everyone else ignores them. Kodak used to invent new film formats and then force the market to follow them, due to their market dominance.

Kodak no longer dominates the market, any more than Sony does. Totally fragmented, which is good for consumers. So no, this is not your typical Kodak film format ploy. That doesn't work in this market anymore.

On the other hand, I heard an ad for a 4-blade razor the other day...sigh. Yeah, I need that. My 3-blade razors are obsolete now. LOL!

No, this is no conspiracy. Talk to people. Non-camera people. What do they want for Christmas? A digital camera. And they don't read camera magazines. They don't read reviews. And there haven't even been that many TV ads for digital cameras - some, but hardly inundating. No, the market just thinks they're cool and wants them at this price point.

Best Regards,

Bill Mattocks