Goodbye Kodak, Hello FujiFilm

Goodbye Kodak, Hello FujiFilm

Summary: After 131 years great American photographic icon, Eastman Kodak, filed for bankruptcy while Japanese FujiFilm rises toward greatness. There is a lesson in here.

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I originally wrote this as a guest post on Vinnie Mirchandani's blog, called New Florence. New Renaissance, which discusses innovation and technology. You can also see a gallery of other photos.

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After 131 years great American photographic icon, Eastman Kodak, filed for bankruptcy. Some might say that Kodak never made a successful transition from traditional film to digital cameras, but that's not exactly correct, because American inventor, Steven Sasson, created the first digital camera for Kodak. I think the Economist put it more accurately, explaining that Kodak had become a "complacent monopolist," enjoying its profitable film franchise and not keeping up with changing market trends. While Kodak invested in marketing, Japanese competitor FujiFilm created even better films, diversified through acquisition, and changed its business model to attack digital photography directly and with strength.

Photo credit: "Pipe Dream Swirls" by Michael Krigsman

As Kodak struggles for survival, FujiFilm is enjoying a renaissance period of innovation. For Nikon and Canon, FujiFilm's innovation with sensors, the heart of any digital camera, poses a genuine threat. Only the future will reveal whether FujiFilm can make serious inroads against established competitors, but there is no question the company will push Nikon, Canon, and every other digital camera manufacturer to make fiercely better products. As a photographer myself, I think it's great.

In 2011, FujiFilm released the X100, a small, lightweight camera with outstanding image quality. Despite usability quirks and missing features, the camera became an instant and viral hit among photographers.

For those accustomed digital single-lens reflex (DSLR) cameras from Nikon and Canon, the X100 is a breath of fresh air - it just feels natural to use. One photographer called the X100, "the greatest digital camera ever made and may just be the greatest camera I have ever owned." Another said, "The images I get from my Fuji X100 are nothing short of amazing."

Photo credit:

Photo credit: "Tourists on the Water in Boston" by Michael Krigsman

I purchased an X100 and absolutely loved it until last week, when I unceremoniously dumped this small camera wonder. Why, you ask, did I get rid of the beloved camera? Because FujiFilm just announced a replacement, called the X-Pro-1. This new machine promises even better image quality than its predecessor, while retaining small size and adding the flexibility of interchangeable and high quality lenses. It's a winner and I'm in line to buy one immediately on release.

As Kodak fades, FujiFilm embodies a new generation of photographic technology driven by genuine innovation rather than strict adherence to marketing formulas. A powerful lesson is hidden in this story.

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  • Top rank suite fogginess

    Was it a case of "complacent monopolist," or more accurately >> "complacent leadership"? I seem to recall there were plenty of Kodak engineers on record who saw the unmistakable early warning signs of the tightening ring of competition, but whose constructive criticism and forward-thinking suggestions - and alarms to roust the comfortably numb, penthouse suite brass - were all but ignored.<br><br>Then it was just one critical misstep after another, even while holding a series of otherwise winning hands. Being caught largely flat footed while the digital revolution blossomed around them certainly didn't help matters.<br><br>Nice shot btw.
    klumper
    • RE: Goodbye Kodak, Hello FujiFilm

      @klumper : Fully agree - Kodak was early in working to develop better sensors, and also better displays, such as OLED. The guys "in the trenches" were doing great work, but management did not understand the value, and thus did not lend sufficient support to these R&D efforts. In fact, the guys doing the best work recognized the lack of management support fairly early on (mid-'90's) and began to migrate to better opportunities elsewhere. Even then, management did not recognize (not apparently have concern over) the loss, so the company continued to sink. BTW, among the lazy or complacent management, one must surely include the board of directors, who *could*have inspired change if they wre truly caring or interesteed. As for Fuji, I'm not in agreement with a concept that they may be "stepping into Kodak's shoes", because my take of the Fiji digital offerings is that they lack interesting consumer products, and consumers were "bread & butter" for Kodak.
      Willnott
      • RE: Goodbye Kodak, Hello FujiFilm

        @Willnott
        Robert J Keegan was at Kodak then went to Goodyear neither company has fared well
        preferred user
  • RE: Goodbye Kodak, Hello FujiFilm

    Oh, my, another commercial disguised as a news item.
    Shara8
    • Exactly what I was thinking...

      This is nothing more than an advertisement disguised as a report on a company in trouble. <br><br>The author even took the time to mention and link to the cameras of his choice from his new favorite company, while bashing Kodak.<br><br>On top of all that, the camera is not even available, so, one has to wonder how the author got his hands on the X-Pro1. Very likely, a deal had to be made.<br><br>Then, the price for the camera is going to be way out of the range of most people, since it's going to retail at around $2000 before the addition of the lenses, which could cost between $700 and $900. So, how many regular consumers are going to spend between $2700 and $3000 for a camera. <br><br>The author failed to mention that the camera is intended for the professional photographer, which is a very tiny portion of the population. So, this article is completely misplaced and not very useful to the general audience.

      BTW, I don't mind mentioning that my last camera is a Kodak, with 12 megapixels resolution, and 30X Zoom, and 1080p movie capabilities, and takes very sharp pictures and movies. It cost me just $200 and it serves most of my purposes, and I'm pretty sure that, any other camera with similar specs is enough for the general population. No need for a professional camera, since it's overkill for most people.

      I'm hoping that Kodak comes out of bankruptcy with no major problems, since I'd like the warranty to be honored. But, the major points about most people not needing the Fujifilm new cameras, stand, no matter what the brand.
      adornoe
      • RE: Goodbye Kodak, Hello FujiFilm

        @adornoe@... I have no relationship with either Kodak or Fuji. The implied notion of impropriety is absolute, complete, and utter nonsense.
        mkrigsman@...
      • mkrigsman: Then, the high praise and fanatical rhetoric for Fujifilm

        was very unbecoming for someone not associated with them. <br><br>Still, your high praise belongs more in a camera addict's magazine than in a forum where most people are not going to be making purchases of such high-end and expensive items.
        adornoe
      • RE: Goodbye Kodak, Hello FujiFilm

        @adornoe@... Why are you and others so full of vitriol all the time. Complain ing and bashing all the time... WTF, can't a writer just express his personal thoughts without getting a pagefull of nastiness from you people? Why don't you all just go kick your dog or something.
        Techyard Dog
  • RE: Goodbye Kodak, Hello FujiFilm

    In 1987 Kodak was provided a White Paper on Digital Photography outlining all aspects covering Cameras, Sensors, Printing and Memory Requirements. It was a roadmap. They Laughed.
    ptrckhudson@...
    • RE: Goodbye Kodak, Hello FujiFilm

      @ptrckhudson@... Yes, that is indeed the sad part. As the post mentions, a Kodak engineer invented the first digital camera, but hubris and lack of focus caused the downfall.
      mkrigsman@...
  • RE: Goodbye Kodak, Hello FujiFilm

    If/when Kodak comes out of bankruptcy, the discards will be the employees (engineers and support teams) left with no pensions or healthcare, while the the executive leadership sails away into golden retirement. Sure seems to me that the 1% is partially made up of incompetents who somehow bargained or stole their way to the top, primarily at others' expense.
    zdnet@...
    • You don't even understand what "bankruptcy" means when a company

      goes into that kind of "reorganization". <br><br>Bankruptcy does not mean that the company will go out of business; it means that it's going to have to restructure, and a lot of that is the restructuring of the debt, with many people holding the debt probably coming out in the losing end. <br><br>Now, there is such a thing as owners of a company, with companies either being owned publicly or privately. When a company has to restructure, many of the losers will be the shareholders, and a lot of them will lose a lot more than the employees who have to be let go.<br><br>You sound like you get your anti-corporation talking points from a six year old who simply knows the words greed and evil and theft, but with no real context or understanding of the subjects or the issues.<br><br>If I invested in a company, and the company has to liquidate, should the proceeds of the company go to me and other investors, or to the employees, who were very likely not invested in the company? If a system ever existed where the employees are entitled to receive more than the investors of a company, then that economy will never get investors to risk their money in any company.
      adornoe
      • Could you be any more one dimensional?

        @adornoe@...
        I have worked for companies that have gone through the tough reorganization and actually owned stock in companies that went backrupt. First off the ones that seem to suffer the least ARE the executives at the top. The worst that happens is they get let go. Of course there is a generous severance package. The worker bees who are let go aren't as lucky. The ones who are lucky enough to keep their job now get to do the additional work of all those who were let go!

        This is not as you say "anti-corporation" it is reality. The way contracts are negotiated for the executives ensure that they are rewarded for failure as well as success. Lee Iacocca was in the minority in that his wealth was totally dependant on the success of the company!

        We have to stop rewarding failure and mediocrity in management as well as labor.
        harrim47
      • RE: Goodbye Kodak, Hello FujiFilm

        @adornoe@...

        It's funny seeing someone criticize another's lack of knowledge then demonstrate their own profound shortfallings in the same category.

        The pensions are debt -- deferred compensation owed to the employees.

        So yes, legally and morally, they have a preferred claim on the assets of the current or future re-organized company above those of equity investors.
        Dal90
      • harrim47: You're making big assumptions

        by believing that, those big time executives at failing companies always end up with great severance packages. Not true!

        However, my argument is about the owners, and the executives are not always the same as the investors. But, if the investors are also the executives, then those executives have all the rights in the world to expect that, they'll be the ones to get most of the leftovers once the company goes bankrupt. But, bankruptcy doesn't always end in liquidation, or shutting down of the company. But, when a company comes out of bankruptcy court, and it's being "reorganized", then it's practical to leave a lot of the executives in place, since they're the ones that understand the company and could probably lead the company to health again.

        BTW, a lot of companies get into trouble, and it's not because of mediocre management or mediocre labor. Oftentimes, the market conditions are no longer favorable for certain types of companies. But, in a lot of cases, it's true that management failed, or that labor, especially with union labor, was too burdensome and the company was rendered uncompetitive.
        adornoe
      • Dal90: Pensions and labor contracts also end up with little value

        if a company has to liquidate.

        Pensions, if they're being managed by the same company going into bankruptcy, oftentimes end up with very little value. And contracts can be rendered null and void if a company has nothing of value to fulfill those contracts. A contract or a pension, can be debts that are rendered "non-collectable" if the entity going bankrupt has nothing left from which those contracts and pensions can be paid.

        I'm pretty sure you know of many labor contracts which are left with no value once a business goes into bankruptcy. In fact, GM and Chrysler are union shops where labor was being left with nothing. The only thing that saved those unions and their pensions, was the government stepped in to rescue the companies. Yet, the only reason for the rescue packages by Obama was for saving the union labor, who are very reliable voters for democrats. If not for Obama and the democrats wanting to save union jobs, GM and Chrysler and the union contracts and union pensions, would have disintegrated into nothingness.

        When it comes to "legally and morally", once bankruptcy court gets a case, contracts and pensions are all on the table for re-negotiation, and, if the investors are the ones that are going to get screwed, it's only a matter of time before they pull out altogether from the company, and the results will be the same as liquidation, and those union contracts and pensions will still be left worthless. GM and Chrysler, were well on the way towards bankruptcy court, and the pensions and union contracts were going to be left with no real value, and the democrats and Obama knew that, and that's the only reason that they came in with their "rescue" packages. But, in the real world, and where union labor is not involved, the investors will normally be the ones getting theirs first, which is the way it should be. Without the investment class, there would not be an economy.
        adornoe
      • RE: Goodbye Kodak, Hello FujiFilm

        @adornoe@... I just read you post below where you start into Obama and the Democrats for bailing out GM/Chrysler. You showed what I already knew from your previous posts. You're a Republican and like, what seems to be the majority of Republicans today, you have a short memory. This recession started under a republican president and it was the Republicans that started the bailouts. It's funny how you all seem to forget that???

        Now you're going to end up with a Republican presidential candidate that actually made his millions destroying companies and jobs to make his money. Hmmm. I wonder why you agree with the way companies can "restructure"?

        Oh and above all else don't let them put any controls in for banks. We all know how the banking practises of the last decade had nothing to do with the recession.

        It would be funny if you weren't so dangerous.
        SoreHead
  • RE: Goodbye Kodak, Hello FujiFilm

    Hey maybe if Kodak had outsourced their jobs to China or another emerging 3rd world country and then wisely held their assets offshore to avoid the oppressive US corporate income tax rates, they might be doing OK. Oh, and by the way, all the pension funds and shareholders wouldn't be left holding the bag.
    Common Senses
  • I miss photographic film like Tri-X and Ecktachrome.

    I spent many a happy hour using the bathroom as a darkroom. I taught myself how to develop Kodak and Ilford black and white film before going to c-41 color prints and Ektachrome slides. I worked with 35 MM 120, and small format sheet film. I enjoyed it, but I eventually gave it up. I just quit carrying a camera. Now, I have a cell phone that takes stills and vid clips. I still find some of my old negs in boxes stashed in the back of the closet.

    Kodak introduced photography to the masses. Now, that company is joining Studabacker, Tucker, and Hudson as innovators who forgot how. American industrial history is filled with stories that begin, "Do you remember...?"

    Paul

    One who remembers F.W. Woolworth's.
    pfyearwood
  • RE: Goodbye Kodak, Hello FujiFilm

    Eh. All the mainstream camera companies, except for maybe Canon, are hit or miss stumblers, especially in the sub-DSLR market. iPhones don't take very good photos or videos to the discerning eye, but most people don't have very discerning eyes, so blurry, overlit, and/or underlit snapshots and fuzzy and/or vertical videos are good enough for them, hence posing a problem the mainstream camera companies seem utterly perplexed at how to deal with intelligently. This might account for the apparent greater emphasis on higher end DLSRs, a market that Kodak ironically invented in the 90's when they modified film-based Nikon and Canon SLR's by fitting them with CCD sensors. Kodak never did quite get a handle on the pro-camera market, though, and instead has had a series of indistinguishable lower end models. Their most remarkable camera of recent years was probably the Zi8 pocket video camera which someone decided to equipped with an external microphone jack: that allowed for adding reasonably high quality sound to pretty decent HD video. So successful was this design that when the Zi8 was discontinued, prices for existing stock shot up more then twice its original list price. Unfortunately, that appeared to be just a lucky one-off for Kodak as they have yet to come up with an improved replacement. <br><br>But Kodak is hardly alone in stumbling: Casio was one of the first companies with a pocket cameras that could take decent video, but failed to capitalize on that (never offering an external mic option for one); Olympus has seen more fun days; Nikon seems to be copying Canon more and more; Sony keeps pushing its technological prowess, but seems unable to not leave in frustrating design lapses; and Fujifilm was pretty random in its offerings until the deliberately retro X100 came out of nowhere.<br><br>Maybe Kodak will get lucky again with its new models coming out shortly, including, supposedly and belatedly, a true successor to the Zi8.<br><br>It's telling, though, that the hottest camera segment right now are rugged compact, and waterproof sport video cameras like the GoPro and Contour models, which were developed completely outside of the mainstream camera market. And which makes Cisco's abandonment of the Flip, which could have owned this market with any sort of savvy product development, even dumber than it seemed at the time.
    JustCallMeBC