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back to article Kodak heading to Chapter 11

It's not what you'd call a Kodak moment: Eastman Kodak, the very image of film-based photography, is heading for the Chapter 11 knackers yard because its management, despite the most visible and public threat imaginable from digital photography, has failed to get Kodak out of the digital trap. The Wall Street Journal reports …

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Paris Hilton

It deserves to die.

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Paris Hilton

Why they deserve to die

Kodak deserves to die because it is a Country Club company - that is, to Kodak's poor excuse for a CEO and board, the company ONLY exists to provide income to support their lavish lifestyles. The employees are something they lay off to stay afloat.

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But they do make the best printers.

Damn, I will have to start overpaying for ink again.

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Sir

This was satire, yes?

I certainly hope so, because the failure rate on Kodak printers is astonishing.

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They do make good printers except they break too often.

Shame really I loved my easyshare. Now I have a HP pos that at least is reliable.

They also make very good wifi and email enabled digital photo frames that works brilliantly for the grandparents. It seems to be one of the best on the market.

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It was good to see some honesty in the printer business

none of this "Pay more for ink than the damn device" junk other manufacturers pull (I'm looking at YOU lexmark)

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Unhappy

Sad. Another star goes down.

Just couldn't wean themselves off the chemicals.

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See also Polaroid.

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Anonymous Coward

Hmm quite sad indeed.

My first camera when I was a nipper of 5 years old was an old Kodak box that shot 110 film, given to me by my Nan, well over 40 years ago. My first digital camera, way back in '97 was a huge clunky Kodak thing that shot a maximum resolution of 640x480, a long way from the Canon 5DM2 I shoot now!

Sad to see the company started by Mr Eastman many years ago, and also started my keen interest in photography, driven into the ground by stupidity at management level.

I believe the name Kodak was chosen by Eastman as it meant nothing and could be used anywhere, plus Eastman saw the letter K as quite a strong letter when used in company branding.

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WTF?

I want a job like that

How come the larger the company the more obscene the bonus is for doing a piss poor job and running it into the ground? $6m for being useless while us mere mortals can be fired without a penny for missing targets that quite often are unrealistic to begin with.

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Anonymous Coward

I assume the billions are US billions. So it would appear that running the company into the ground still entitles you to about one-thousandth of the total revenue. how many employees in total?

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RIP Kodak

Well written article. There is something about big business, where the top management never sees the impending disaster in full frontal view of it approaching.

Is it arrogance? I think so.

Some examples: Titanic (the ship), GE (of Britain), ICI (of Britain), British Steel, Amstrad, Nokia, HP (getting there), Motorola (nearly died), RIM (Blackberry- launch of tethered playbook with no ecosytem),.......one can add more.

A nice race to the bottom.

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Anonymous Coward

Amstrad !

They made shit products and deserved to die.

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Anonymous Coward

Arrogance? You Bet...

and as ever yesterday's Dilbert was absolutely on the money.

http://dilbert.com/strips/2012-01-05/

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Anonymous Coward

Amstrad didn't die though...

... they were bought out by BSkyB who wanted to do the Apple "Own it end to end" piece.

As far as I can see AMS walked away with a nice tidy sum...

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Anonymous Coward

No, they made cheap and cheerful products that anyone could afford to buy and enjoy using. They may have been a bit plasticy and bit shitty but a lot of people I know had their first computer experience on a CPC micro or cheapo PC clone made by Amstrad. My own first PC experience was on an Amstrad PC1640 which my old man worked lots of overtime to afford for my family, so we had a chance at not being left behind when home IT took off. That cheap and cheerfull PC clone lead me to choose to go to college and study CS/IT properly and then go on to a career in IT.

I think Alan Sugar was/is a real wide-boy, Del Trotter type, but he gave people a leg up and chance to ensure they didn't get left behind when home technology took off.

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Stop

But the *original* Amstrad...

...was wound up in 1997. The Amstrad that came after was actually phone manufacturer Betacom, which had been a subsidiary of the original Amstrad.

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Anonymous Coward

They missed the whole point of disruptive technology

The way I read the company a few years ago, Kodak correctly saw that the developed world was moving to digital cameras, but, they thought that they could still make good money selling their "old" technology into the developing nations (no pun intended).

Why wouldn't this be the case? The developing nations were decades behind in many (tech) ways, so there must be decades of selling old tech to them while they catch up.... right?

The problem is that the developing world jumped straight to digital.

The same applies to networks, a nation with no network can drop a wireless station onto every hill and catch up almost instantly. They must laugh at all the copper we have running under our pavements.

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Anonymous Coward

Compare & Contrast

Compare and Contrast this with Fuji Film who had exactly the same dilemma and have diversified into other fields, using their printing and imaging knowledge to make cameras, optics etc.. and branch out from this using their chemical understanding to move into the medical, pharmaceutical and cosmetic areas.

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to be fair Fuji...

...was already eating Kodak's chemical paper and film lunch. Rochester has been under siege for years and they have just failed to react properly to protect their market and their company.

Chapter 11. My oh my.

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In addition...

...I think Fuji was smart enough to focus on the one part of the old process that still had significance: the printing. They adapted the process to one that could used image files as the base, and suddenly digital cameras weren't a concern at that end (since many people still want physical prints in the end). I'm sure you'll find many print labs still using Fuji equipment (I know Walmart still uses them for their standard photo systems--the "instant" jobs go through HP) and Fuji digital camera processing frontends.

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Facepalm

With appologies to Paul Simon.

If I look back on all the crap I learned at Buis-school,

It's not surprising I can hardly think at all.

And my lack of techie forsight rather hurt me,

I went and sent the whole $%^%$ company to the wall.

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Headmaster

Damn you, autocorrect, damn you

So, no tweet answer to the "bass question" then.

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Hindsight? Not in the least

I distinctly remember a talk I attended back in 1984, when the company I worked for at the time did some joint research with Kodak. One of our guys had returned from an extended visit to Kodak; he began his talk by saying, "Kodak is a funny place. It's a company full of chemical engineers who really, really wish they'd studied computer science."

Hindsight? No. It was obvious, 27 years ago.

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Facepalm

Re: Been There done That

I had pretty well the same thoughts in 1975 when I went there for a Job after Graduating.

Ironically at EMI as well, lots of engineers wishing they'd deen the other sode of the microphone.

At the time, they were at the forefront of Medical Scanner development.

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Pint

re: Hindsight

That's a spooky recollection... in 1985 I left Kodak to go back to grad. school in... Computer Science. Of course, now I'm a professor, and my farts don't stink.

Beer icon, cuz it gives me gas.

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But they did make some excellent CCD chippery even then

We used one of their early KAF chips in image analysed microscopy 23 years ago. The KAF series of CCD chips is highly regarded, but their use is mainly in the astronomy market (small niche), and in medical imaging cameras (smallish but lucrative niche). Some of their chips found their way into digital cameras (an early digital Nikon as I recall). Quite a few astronomers are seriously alarmed that only one big player will remain in the CCD manufacturing business (Sony). CCDs are more sensitive (through larger fill factor) than CMOS chips, but this is only really of concern in seriously low-light conditions (such as astronomy and fluorescence microscopy).

The problem seems to be they did not see CMOS chippery replacing CCDs as the norm on regular cameras. So apparently they fumbled in (at least) two ways: they did not judge the full impact of digital photography on their film business, and they kept focusing on CCD chips more than CMOS.

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Paging Cory Doctorow...

Anyone know how Duracell are doing?

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It has to be said...

They keep Going, and Going, and Going. Or was that Energiser?

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Duracell is owned by Gillette

Which was purchased by Proctor and Gamble a few years back. P&G has no qualms about ditching an unprofitable division though, or splitting one out and setting it free.

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In any event...

Both Duracell and Energizer are still going. People still need alkaline batteries for their everyday stuff, and they keep a diverse line of specialist batteries (such as lithium watch batteries, NiMH rechargables--they incidentally keep working on that tech to differentiate themselves, it's why we have batteries that hold charges for longer), so I don't think either one is going away anytime soon (in any event, Energizer is now a conglomerate with acquisitions in personal care products as well). Nor is Rayovac, which continues to hold a nice spot at the low end of the battery spectrum.

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FAIL

David Allen did a bit on this sort of thing

He of GTD fame said that, once, a company who made precision drill bits couldn't fend off cheap competition from China, so they re-focused their business. Did they make drill bits? No, they were in the market of making excellent holes. What else can do that? Frickin' lasers.

The company was reinvented and became very successful.

The same should have happened here. Are Kodak in the market of making film? No, they're in the market of producing great quality photos. The printer thing should have been completed by a digital camera thing (much firmer than the one we were subjected to) and a scanner thing, and a data storage thing, and an online archive thing, and a sheet-feed photo-scanner-archive thing, and a ... you get the idea.

For the company to stare at the writing on the wall for *this long* ... as someone else said, they deserve all they get.

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@ TheOtherJola - they tried

Kodak did try to fill out their photo portfolio, but failed, pretty miserably, as evidenced by their poor returns. About what you'd expect from a bunch of chemistry people who wandered into the field of photography.

Kodak's desktop software ("Kodak Image Gallery" or something like that) came out in the early 00's. Did a decent job pulling in pictures and presenting them. Achilles heel? Not possible to export the gallery meta-data to another computer, you know, as in migrating to a new machine. Also braindead on handling imports of duplicate snaps. Whoops. Picasa handily took over when it came out. So cross Kodak off of the data storage and archiving possibilities.

Kodak's digital cameras were also laughable. We had what was probably a second-gen one. 3.1 Megapixels, gave good picture quality. Live-view did not exist, slower than ages to focus and take a picture, and the thing ate batteries like mad and was picky about them on top of it. We hated it so much we went back to using film.

So Kodak, rather than think they were in the picture business, building a whole portfolio around their chemicals and their processing systems, should have built chemical-processing solutions for any other industry. They were probably also scared to death to invent or commercialise a product that would disrupt their chemistry business.

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Anonymous Coward

Yep - two more for you...

Railroads thought they were in the railroad business, and still do.

Airlines think they are in the airline business, and still do.

WRONG - they are in the transportation business, and as soon as better transportation comes along, they are (or will be), dust.

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Thing is...

...the roads, rails, and skies all have physics to bolster their advantages. If you want delivery from warehouse straight to warehouse, it's hard to beat a tractor-trailer that can travel the roads from loading bay straight to loading bay. That said, trains have advantages in bulk and less friction to fight, which is why they can transports lots of stuff for much less per mile than truck. And then you have jets: when speed is a must.

It'll be interesting to see how any of these can be unseated while still obeying the physics that give each method its preferred niche.

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Rather ironic

that an Eastman Kodak engineer Steven Sasson is credited (in some circles) as the inventor of the digital camera circa '75 utilising the CCD invented in '69 by Willard Boyle and George Smith. Eastman Kodak also invented the worlds first megapixel sensor in '86.

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Unhappy

I assume...

...the engineers responsible were subsequently discouraged from further messing about in areas not the core-product.

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Go

Wow...

That's just a shame, really. Kodak did make some pretty decent digital cameras... 6 years ago. (sure, it's only 4MP, but the glass and imaging ASIC were very good for the price point and the technology level)

I will also note that Nikon also diversified quite some time ago as well, going into microscopy and other imaging fields other then pure film.

The real question is this: what will happen to the retro folks and hipsters who still use their film cameras?

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Unhappy

Kodak already sold off the image sensor technology

The article failed to mention that Kodak sold off its last viable business -- Image Sensor Solutions -- two months ago. Since that was the one and only technology Kodak still had going for them, that was the point when the industry realised that Kodak was really and truly dead.

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What you've failed to mention is why they sold off ISS. They were already going down the tubes which is why they sold their sensor business since it was the only bit of the business worth anything. The idea being, presumably, to get some capital to pay off their creditors. As a solution this stank. Maybe they could pay of some of their creditors, but the business that was left would no longer be viable.

It would have made more sense to sell off other parts of the business. Sure they would probably have got a couple of dollars for the whole shebang, which would hardly have paid off their creditors. What it would have done, however, would have have been to leave a viable business that their creditors would have been happy could pay back their debts long term.

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Too bad they didn't fall back on their long history of selling affordable, quality cameras (despite what the article states). My 1950s Retina is still going strong, and has Leica-quality glass on a German-made body. But I've been running Ilford products on it exclusively since Kodachrome died.

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@Grease Monkey

Yeah, that was my point. Selling off ISS was the death knell for what remained of Kodak, since it was the only viable business they had.

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Facepalm

"The real question is this: what will happen to the retro folks and hipsters who still use their film cameras?"

Same thing that the professional photographers who still use film will do: buy from Fujifilm, Ilford, Foma, Efke/Adox, Rollei, some Chinese companies and more than likely Kodak, since they continue to operate while they restructure under Chapter 11 and their film division supposedly has been one of the growth areas within the company.

Even if Kodak imploded tomorrow morning there's not exactly a shortage of companies still making film, though Fuji are the only major player left in color film besides Kodak.

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WTF?

I can't help thinking that ten years or so back (once the writing on the wall had become too big to ignore) they should have split the business into two separate companies owned by a holding company. Then you get Kodak Film Products and Kodak Digital Products owned by "Kodak". Over time you grow KDP and allow KFP to shrink. If KFP fails, you let it go bust and live on with the remaining KDP owned by "Kodak".

Is this a naïve way of looking at it? If it was possible, surely we would currently be seeing headlines such as "Kodak's ageing film division collapses as Kodak Group goes from strength-to-strength".

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Facepalm

how?

how the hell can a CEO be paid such a ridiculous amount of money for failure....

they haven't turned a profit since 2007, two years after he sat in the big chair... and its only the last year he had his pay cut by half for not reaching targets... what was the target? grind the company into the ground?

the only thing kodak have left of value is a handful patents (most will be for obsolete technology) and its name... the current batch of printers are not good.....

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@Marty

Yeah, that's what keeps getting me.

What kind of idiot thought that, having had problems for several years, letting the CEO continue working to a contract where making hundreds of millions of dollars of losses would be rewarded with millions of dollars?!

No doubt at the same time all the lower-down plebs were on salary freezes with bonuses a distant memory while "the company tightens its belt to find a viable future". Been there, done that (for a large multinational whose then CEO was later found guilty of embezzling funds, as it happens).

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Anonymous Coward

And the reason they made a profit in 2007?

The reason they made a profit in 2007 was because they sold all their OLED Intellectual Property to LG - Talk about selling the family silver!

They had been making a huge loss for years before that and would have made another loss if it wasn't for this sale.

Coincidently and I am sure purely unintentionally this reset the clock so every body says they made a loss since 2007 - sounds so much better than they have made a loss for over a decade.

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"Kodak could be making light-sensing chippery"

They already do. They make a very fine range of CCDs.

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Unhappy

Did.

They sold off that division two months ago.

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Now that is stupid.

The Leica M9 (18 megapixels, 24mmx36mm sensor area) uses sensors made by that division.

So does my rather cheap compact camera.

They sold off the future of the company.

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