[drglitch]

As sad as that is, it's a pretty long life for a company that was killed by mis-management: they invented the digital cameras but chose not to cannibalize their incumbent analog business. To combat demise, they chose to fire people and become an IP shell. Last try at survival was to sell off most/all IP and license its name. The rest is history.

[meric]

We weren't in the company. It can be hard to tell. You could open a beauty therapy shop, and it's revenue increase every year, and suddenly after the introduction of cheap laser treatments and race-to-the-bottom competitors, in one year you could face a reduction of 70% of your revenue.[1]

[1] Anecdote.

[ghaff]

Kodak certainly did a lot of things wrong--especially with the benefit of 20-20 hindsight. Part of their problem with digital was that they were arguably ahead of curve (and not quite on the right curve) with things like PhotoCD and providing equipment to photo shops to print customer photos.

However, the bottom line is that it would probably have been very difficult for even the most brilliant management to replace the film, photo paper, and chemicals consumables business. That revenue basically doesn't exist in the digital world unless maybe you count inkjet ink--though that's trending down too.

Fujifilm did end up doing OK by, among other things, applying their film making expertise to other industries like medical. But they had a tough run too. [1] The film business fell off a cliff that made CD sales look like a gradual decline.

[1] http://www.economist.com/blogs/schumpeter/2012/01/how-fujifi...

[intrasight]

I worked at Kodak as a summer intern in '85. Was the era of the disk camera. Was also my first programming job. Lotus 1-2-3.

Most people today can't comprehend the scale of American manufacturing as it still was at that time. The Elmgrove plant where I worked (one of a dozen facilities in the Rochester area) has over 14 thousand employees. Our start and end times were staggered in 7 minute increments to manage traffic flow.

That none of that would exist 20 years later was inconceivable at the time. The word "disruption" wasn't in business vocabulary. Nor was the phrase "made in China". Some senior technical managers saw the "digital" writing on the wall. But what could they do? What could anyone do? There was no way to turn that aircraft carrier on a dime.

There was no business model in digital cameras that would employ 100 thousand engineers, managers, factory workers, technicians, and staff.

[ghaff]

What people don't get a lot of the time when they're opining about what a business should do or should have done because the market is collapsing/collapsed for a particular product category is that you have to run the numbers. Maybe the business executes brilliantly on creating a new $1B business (which is hard). But if that replaces a $10B business, things are still going to get ugly. I don't have the exact numbers at my fingertips but, as I recall, film revenue fell something like 90% in under 10 years.

(That said, Fujifilm provides an existence proof that Kodak could have, however painfully, probably navigated this with better management making better choices.)

[ceratopisan]

This bit about replacement of the business is exactly true; most people don't realize Kodak was making digital cameras the whole time film was being replaced. As a purely off-the-cuff guess, I'd bet the entire digital camera industry is smaller than Kodak's film processing work at its peak.

I live in Rochester - Kodak was literally one end of the entire city; the scale of the operation was huge.

What I regret was that it was a good place to work, though I was never there. Car dealerships would plan annual sales around bonus time at Kodak, and retirees had health care for the rest of their life, for instance.

[jacquesm]

It's one of the best examples of what disruption really means. To me it translates into that no matter how well you prepare yourself none of your best plans will be close enough to the reality on the ground to be of much use and the size of your company actually becomes a hindrance rather than an asset.

[ethbro]

> and the size of your company actually becomes a hindrance rather than an asset.

I'd say less size than diversity. Conglomerate aren't subject to this and still preserve a lot of the benefits of size (although as GE Capital shows... that can go badly too if not risk-managed).

[ghaff]

Although I'd argue that, if anything, a conglomerate is even more likely to just walk away from a business that's in sharp decline rather than taking heroic measures to try to fix things the best they can. Maybe maintain it as a small cash cow business if appropriate, but you probably end up with a lot of the same factories closed and workers laid off.

The company as a whole probably makes it through OK and that's probably a net positive given HQ staffs and so forth will be more likely to keep their jobs and there's less disruption than a bankruptcy but a lot of the same net effect is still the same.

[rodgerd]

> Fujifilm did end up doing OK by, among other things, applying their film making expertise to other industries like medical.

Another thing they did was carve out a very nice niche for themselves with their X-mount cameras. They've done quite well in part because the in-camera processing engine does a good job of emulating a lot of the old Fuji film stocks (as well as making very nice cameras that offer something different to the canokin mill).

[ghaff]

I have an XE-1. Now there's retro i can buy into. Especially with the pancake lens, it really feels like an old fashioned rangefinder in a lot of ways.

I don't know how much money they make off that line but they've done a nice job of it to the point where I don't use my DSLR very much unless I'm shooting action or need either ultrawide or telephoto lenses.

[rodgerd]

I've gone to Olympus, which has much the same appeal for me, and my Canon equipment is very much unused these days.

Interestingly Olympus are one of the few traditional camera vendors whose camera division are moving up in profitiability, so it seems that "doing something different" can work quite well.

[Aloha]

They really did have trouble letting go of the per-imprint pricing model in the end.

I believe that photo-chemical prints are better and longer lasting than any inkjet (anything really other than dye transfer and offset printing), but they didnt get digital cameras out there fast enough, and couldn't let go of the film based model.

[hosh]

What I understand was that they had developed advanced technologies on holographic film technology, had a nascent business in forgery-resistant ids, and declined to pursue that business.

[ethbro]

Of course. Hindsight 20/20, etc.

But I feel like if your business is a mature process based around a singular need, having a future disruption department to keep tabs on the market and feed back into high level management should be de rigueur. Innovating amazing and critical components of digital cameras and then spending $5B to buy a drug company in 1988 deserves to get you some future flak on your corporate leadership's decisions.

[fancyketchup]

I think you're being more than a little unfair.

Part of the problem is that there simply isn't as much money to be made in digital as there was in analog. A digital camera doesn't need film, but film (and film processing) accounted for much of Kodak's profits for many years. So it's not just a simple matter of "make digital cameras instead of analog ones".

Also, remember that Kodak was very big into digital imaging, and was considered the leader in the field of high-end digital cameras. That is, until the Nikon D1 came along around 1999. Even then, Kodak sensors were common among the next few generations of DSLRs.

[amyjess]

Didn't they also have a stint as a patent troll?