Open Me First
When Christmas time came around, the infamous KODAK box had a tag on it that said “open me first’, so that you could take pictures of the everyone opening the rest of their gifts.
Yesterday, Kodak’s CEO announced a last gasp attempt to save the company
He might have been better off tagging his speech – don’t bother opening me at all.
It’s tragic.
Kodak.
Once it defined photography.
I actually had one of the Instamatic cameras shown above.
Who didn’t.
Kodak meant photography. George Eastman, Kodak’s founder pretty much invented amateur photography the way that Steve Jobs invented the personal computer.
For years they were the world leader in photography.
Now, it seems, Kodak is on the ropes.
Antonio M Perez, Kodak’s CEO has bet the company’s future on printers
Bad bet. Or so says Wall Street. In an era of smart phone and iPads there just isn’t that much demand for hard printed copies, and apparently there is going to be less and less demand. On hearing the company’s plans one Wall Street analyist said the company ‘is jumping from one buggy whip business to another’.
Shares in the company have declined 75% since the first of the year. The printer announcement dropped them another 2.4% to close at $1.24.  Many believe the company will be in bankruptcy by Christmas.
How did this happen?
How did it happen that a company that was once solid gold has pretty much evaporated before our eyes?
It didn’t have to be this way.
In 1975, Kodak scientists invented digital photography.
Of course, the camera was the size of a toaster and cost a fortune, but Kodak was there first and owned the technology.
At that time, Kodak controlled a mind boggling 90% of the film market and 85% of the camera market in the US.
They had the future in their hands and they threw it away.
They threw it away because they could not bring themselves to transit the company from a film company to a digital company, even though, clearly, they not only understood the future – they invented it.
In one notorious incident, so reported The New York Times today, Kodak’s CEO in the 90s, Kay Whitmore, fell asleep during a meeting with Bill Gates at Microsoft.
Lke I said, tragic.
But there’s a lesson in here.
Even though a company may seem to be invulnerable and own an industry, past success is no guarantee of future success, particularly when a new, game-changing technology comes along.
I am thinking of this as I am looking out the window at 30 Rock, the home of NBC.
Here’s the KODAK of the video/television business. David Sarnoff, like George Eastman, pretty much invented TV as we know it.
But NBC’s dominance is wedded to an architecture designed in the 1950s. – Big studios, big buildings, big cameras, big salaries, complex and expensive production methods, and a distribution platform based on pushing their linear programming through the air on onto cable.
This morning we screened a feature film shot on an iPhone by an unknown for next to no cost and then put on the web, available to 2 billion viewers for free.
Is NBC vulnerable?
I think so?
Will they be nimble enough to make the changes that will be required for them to thrive in a digital, non-linear, cheap-to-produce world? Maybe, but I wouldn’t bet on it.
It would be easier for someone else to start from scratch, building a model that is reflective of the digital technology of 2011, as opposed to jamming the technology of 2011 into a business designed for the technology of 1958.
As KODAK used to say, ‘You push the button, we do the rest’.
If only they had listened to their own motto.
2 Comments
steve October 21, 2011
you read some of the trades today and it’s as if whistling past 30 rock is in vogue.
John D October 21, 2011
And it’s not just Kodak who is having to “change”.
Here’s an article from Creativecow.net magazine that claims Arri, Panavision and Aaton, traditional “BIG” camera film suppliers to Hollywood and the world, are shuttering their film operations to focus on the digital world.
http://magazine.creativecow.net/article/film-fading-to-black