Skip to comments.Photography pioneer Kodak files for long-expected bankruptcy
Posted on 01/19/2012 10:12:19 AM PST by Red Badger
Eastman Kodak Co., a vanguard name in photography, finally filed for Chapter 11 bankruptcy Thursday following falling sales and rising speculation about its ability to stay afloat.
The long-anticipated announcement came after weeks of early eulogies about the faded glory of the former trailblazer, once an American mainstay with products such Kodachrome photographic film and Instamatic cameras.
But printed photos seem well on their way to becoming a hipster curiosity as digital technologies -- which originated at Kodak decades ago -- now dominate on smartphones and, to a shrinking degree, cameras. The company, which was also exposed to heavy foreign competition and dwindling customers, has watched its liquidity situation worsen for years.
(Excerpt) Read more at latimes.com ...
Guess I’ll make my rounds to pro photo shops this weekend stocking up on 35mm.
So momma don’t take my Kodachrome away.
They needed to rent a few Congressmen to force phones to also use film in addition to digital images. I wish I was joking, but the National Association of Broadcasters has been pushing to require cell phone include broadcast radio receivers. Maybe the buggy whip manufacturers can require that the accelerator pedal be activating by whipping it.
“My work is finished”. - George Eastman
“My work is finished”. - George Eastman
they didn't realize it was the beginning of their end.
(And I've got 2 of 'em!)
This is what happens when you ignore a disruptive technology that makes your’s obsolete. They could have tried to lead the digital camera market but instead chose to stick with their bread and butter products. The first digital cameras were so clunky and low res that they probably thought they would never be able to compete with film. They found out too late that they could.
Ansel Adams just rolled over in his grave.
So did Paul Simon...oh wait, he's not dead yet.
Just to clarify, I wasn't referring to the late Illinois Senator.
While I do own digital cameras, I still prefer film for my photography. There is nothing more fun than developing and printing your own film.
I realize that it doesn’t fit with most peoples use of cameras but for artists, good ol’ photography cannot be duplicated the same way digitally.
Don’t count Kodak out yet.
This is a very clever move to allow Kodak to pare back the very expensive pension and healthcare obligations that they have with their retirees. The company is supporting 5 or 6 times as many retirees as it has employees and this financial burden is draining them of resources needed to stay competitive and advance their technology.
Now that chapter 11 has been invoked, they can go forward with technological advancements instead of social programs.
LG's OLED was pronounced the biggest hit at the Las Vegas CES 2012 show
On February 23, 2011, President Obama appoints CEO Antonio Perez to his Council on Jobs and Competitiveness, for reasons that are still unclear but do make me wonder about his judgement. Obama obviously does not read the Night Owl. Or perhaps Perez was appointed as an example of what not to do, since he has clearly demonstrated he knows nothing about either competitiveness or jobs. Destroying yes, creating no..
It speaks for itself.
“This is what happens when you ignore a disruptive technology that makes yours obsolete. They could have tried to lead the digital camera market but instead chose to stick with their bread and butter products. The first digital cameras were so clunky and low res that they probably thought they would never be able to compete with film. They found out too late that they could.”
Some Kodak execs togther with some hedge funds needed to do a leveraged buyout and take Kodak private some years ago, at the earliest stage of digital photography and before the full measure of the revenue shift from film to digital was apparent.
Stock investors, individual or institutional may have long-term views of their own portfolios but are not the best judges of the best long-term interests of a company whose stock they hold; they want quarter by quarter steady earnings per share, regardless of how much of that might be paid out as dividends versus reflected in market share price. The calculation of long-term return on a stock, using “today’s” net earnings per share, will seem increasingly less advantageous, when quarter by quarter that “today’s” net earnings per share is not positive. Not knowing if all the places where the company’s spending is going will some day pay off in better returns, many public investors are inclined to sell.
Long after Kodak itself acknowledged the coming of digital photography. film and photo printing not only remained the most substantial part of Kodak revenues, the profit margins remained greater om film and photo printing, way better, than anyone was getting on digital cameras.
The Kodak execs had dificulty admitting to the stockholders that capital investements needed to quit being spent on film and things related to film and film’s great revenue margins needed to get eaten up in large capital investments in the digital revolution. They refused for too long to deny to the stock holders the highest net earnings per share they could get, even though doing so limited the restructuring and diversions of revenue needed for a better future.
Costs go up not down over time, normally, and by the time Kodak realized it had erred in it’s vision track for far too long, its great film revenue, still it’s biggest revenue source, was already declining, reducing the margins needed for big changes in capital spending. It had temporarily, for too long, appeased the stock markets, at the expense of doing what needed to be done for the future.
A privately held Kodak, taken private by Kodak execs and hedge fund partners years ago with the right vision, could have taken the risks and spent more revenue on the future, not needing to satisfy a public marketplace’s obsession with continuously great quarterly net earnings per share.
Yes, Kodak would have quickly and in the short term immediately shrunk in size, with many layoffs and closings of some of it’s business units, and the new private owners would have been lambasted as capitalist cut-throats for all the lost jobs. But, had that been the course, then instead of declaring bankruptcy today, the privately held Kodak may have instead been announcing a new IPO for itself.
Maybe something of such a course is still open to Kodak, as a result of the course of its bankruptcy.
“This is a very clever move to allow Kodak to pare back the very expensive pension and healthcare obligations that they have with their retirees. The company is supporting 5 or 6 times as many retirees as it has employees and this financial burden is draining them of resources needed to stay competitive and advance their technology.”
I thought that chapt 11 didnt eliminate the pension plan obligation.
“There is nothing more fun than developing and printing your own film.”
If you say so. :-)
I love it. I do have to confess that since we moved and bought the old school in town, I haven’t gotten my darkroom finished and set up again. I should work on that this spring. LOL.
And here I just bought a Kodak digital camera as a Xmas present.
Wonder what’s going to happen to the warranty.
You don't need no steenking warranty!.............
It's interesting to me how many small companies have been started up by former Kodak people, they're a bright bunch. Rochester's lucky to have them. I have to wonder how they'll make out in New York's dismal business climate, though.
yep...the workers will get kicked into the “lucrative” Pension Guarentee group.....
“Quite frankly, if not for the brutal winters, it would be the ideal place to live. “
I live in the region. I agree with your statement to a point.
If not for the fact that it is in the political boundaries of NY State, it would be the ideal place to live.
I live one county over, and not far from the heart of the Finger Lakes region.
I love it here. I love the geography, the hills and lakes and windy roads and the open fields and the forests and farms and the people are actually quite genuinely friendly and courteous too. (Just stay out of Rochester proper).
(I get a kick out of it when out-of-towners express their surprise and bewilderment when someone holds a door for them at a store. Or when driving, lets them out into traffic or waits so the guy making a left can go - things we locals take for granted)
Yes the winter can be a bit much, but a lot of folks just go skiing, or snowmobiling, or sledding, or any number of winter activities. Some of us, me included just bitch about it. But that’s OK too. We all actually like it.
But the real killer is the fact that it is in NY. With the overbearing taxes and regulations and the anti business environment.
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