Kodak Lagging in Digital World

mattmcal writes "Wired reports on the Kodak's struggle to survive and Mark Glaser comments on their demise at The Industry Standard saying that Kodak failed to take digital photography seriously, or at least failed to find a way to successfully transform their business. The Photo Marketing Association reported that in 2003, digital cameras outsold analog. Kodak's stock has been hovering near its 20-year low. Finally, today, the Asian Business Times reports that billionaire Carl Icahn sold all his shares saying the current business model there doesn't work."

Comments

Film

[October_30th]

With the ever increasing use of digital photography, I've become wary of the same problem that plagues digital media in general: it's so volatile.

Properly stored original film negatives last decades, whereas digital media is gone in a blink of an eye when your harddrive/memory card breaks down or you accidentally erase your media.

It's the same thing as with e-mail. I routinely print out all my e-mail correspondence (sent and received) these days because I've lost my mails too often.

Re:Film

[Soruk]

Very good point. I make a point of archiving my photos to my fileserver which is regularly backed up to tape, and will be put on to some CDRs (or even DVD-Rs) when I've taken enough of them.

The huge advantage over traditional film has to be that there was a significant cost overhead with traditional photography - if a photo didn't come out as intended that was money down the drain, so I very rarely dug out the camera and used it. With digital, if the image isn't as intended then nothing is lost, you can just delete it and try again. Indeed, you can just be trigger-happy and take multiple shots and just use the best of what comes out. And, once you've archived the photos, unlike a traditional film camera, you can erase the media and use it again.

I know this seems obvious, but recently I was talking to someone who actually didn't realise this advantage over traditional film (and he spent nearly GBP1000 a year on film and development, with that he could have a top-notch digital!)

Re:Film

[archilocus]

Indeed, photography is 10% skill and 90% luck. You need the luck to capture the moment but if you don't have the technical skill with film you'll miss your opportunity. Digital gives you more opportunities for no additional cost.

I'm a 'good' photographer and my hit rate has gone from maybe 10% per 'shoot' (roll of film) to 50% per shoot (full flash card).

One important point that is overlooked is I get to post-process my own pictures with digital. That way, since I know what I was trying to achieve originally, I can rescue a less than perfect picture, where some ham-fisted instant lab operator would have torched it.

creative destruction: changing markets

[Reinout]

A 1942 book by Joseph Schumpeter (excerpt here) provides some background info on this.

[Capitalism] incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one. This process of Creative Destruction is the essential fact about capitalism. It is what capitalism consists in and what every capitalist concern has got to live in....

The idea is that capitalism and innovation are almost linked. By doing something better, handier, cheaper, you can make more money than the other companies. So there is an incentive to do something new.

Seen over a long time, the biggest threat for companies is not so much the competition in the existing market, but the landslide next year when something entirely new just chops down existing, nicely ordered, markets.

Digital photography is such a "creative destruction" development. Suddenly the demand for ordinary kodak camera rolls drops down. Not even the best product in it's category will sell really well when the entire market moves to different products. (Kodak is not just camera rolls, also photographic paper etc, but this is the general idea).

An historical analogy: the dreadnought was the first all-big-gun battleship, completed in 1906. Great Brittain and Germany (and others) were engaged in a huge shipbuilding arms race. A lot of "ordinary" battleships were being build (one year later they were called "pre-dreadnoughts"...). That one single first dreadnought, prototype of the modern battleship, made every single fleet on earth obsolete. Brittain and Germany effectively had to start from scratch, 0 vs. 0. (Or, more rather 1 vs. 0 :-) Talking about creative destruction...

Reinout