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Why Kodak Died and Fujifilm Thrived: A Tale of Two Film Companies

169 points by bleair 8y ago

ghaff 8y ago
Good in-depth and balanced piece. (Although it does gloss over a little some of the struggled Fujifilm had during the transition from film.)
jrockway 8y ago
I think Kodak merely picked the wrong pivot. They thought they were a photography company, but they were actually a chemical company. There is plenty of demand for chemicals these days, and if they had stuck with that, they'd be doing fine. (I think these days they brand themselves as an "imaging" company, and they sell products like document capture systems. But that really makes them a software company, and I doubt they're doing great there. Document capture will probably be taken over by phones; Google is already playing with that and I'm guessing they have better software development teams than Kodak.) Fuji was in a similar place, of course, but they were already making high-end cameras and they were selling well. I use a GW690ii from 1985 regularly and it has one of the best lenses I've ever used. They did not forget how to manufacture those over the intervening 30 years, and there is plenty of market for lenses. (Though I would still worry. Tiny cell phone cameras are becoming better and better every year, and that's really a function of the sensors, which they buy from Sony.) Ironically, Fuji did kind of screw over the film photography community recently. They stopped making 4x5 Velvia 50. They stopped making Acros 100. Now everyone is using Kodak or Ilford film. But it's because they could afford to, getting someone to buy a new digital camera every couple years is way more profitable than making chemicals for a super niche industry. Kodak still doesn't understand that, but they do get some of my money as a result ;)
- cuecrkofhdbe 8y ago
  The chemical division of Kodak, Eastman Chemical, was spun off in 1994 and is doing well. https://www.reuters.com/article/us-eastman-kodak-idUSTRE7BN06B20111224 https://www.reuters.com/article/us-eastman-kodak-idUSTRE7BN0...
  - simonh 8y ago
    So they divested themselves of the profit making part of their business and doubled down on the generic, modularised part of the business based on technologies they had no advantage in. Nice!
    - warrenm 8y ago
      Sounds like HP spinning-out Agilent, doesn't it?
    - emiliobumachar 8y ago
      What makes Eastman the spinoff and Kodak the "they" in your statement? The name? That should be 100% a branding decision, and presumably the Kodak name was more valuable attached to the mostly B2C camera business than to the mostly B2B chemical business. If not the name, then what is the token of "genuiness" that stayed with Kodak?
      - simonh 8y ago
        I’m going by the article. “Eastman Kodak spun off its chemicals business to help pay down debt.” At the time the CEO was quoted “Mr Whitmore, who has been under pressure to restructure Kodak, said Eastman Chemical would be spun off as an independent public company...”.
- nicoburns 8y ago
  Digital cameras are hardly a small market and they had the technology first. They just got stuck in the past.
  - throwaway2048 8y ago
    The are a tiny market compared to kodak at its peak with film.
  - coldtea 8y ago
    It doesn't have to be small in itself, just small in comparison to what Kodak did in the past, which is it.
- kemiller 8y ago
  Speaking as someone who had a second-row seat to Kodak's failure to meet the future, it was absolutely a case of stuck-in-the-past. The brass in Rochester just couldn't, wouldn't believe that the light at the end of the tunnel was a train, and they hobbled their own entries into that market at every turn.
  - warrenm 8y ago
    Sadly, this sounds endemic of so many companies in NY
  - abruzzi 8y ago
    I read somewhere, and sorry I don’t remember the source, that Kodak knew the digital future was coming, but they didn’t believe the speed with which it arrived. Kodak was one of the first companies with digital cameras.
    - kemiller 8y ago
      They were addicted to fat film profits and couldn’t read an exponential curve.
      - ghaff 8y ago
        That's probably true but good luck when your primary revenue source falls off an utter cliff which is basically what happened with film sales. You basically have to build a new $20 billion company within a few years.
        kemiller 8y ago
        Oh yeah I get it. They were in a tough spot. But they still almost went out of their way, it felt like, to screw with the parts of their business that were trying to save them.
      - throwaway2048 8y ago
        Kodak was larger than the entire digital camera industry currently is, by almost 3x, $31 billion[1] in 1993 dollars which is 31 billion in 54 billion in 2018 dollars[2]. The entire digital camera industry was worth about 18 billion in 2017[3] Even if they captured 100% of the market (which would have been basically completely impossible), it would have been a massive disaster for them as a company, and to the hundreds of thousands of people they employed in photo processing. [1] https://www.photosecrets.com/the-rise-and-fall-of-kodak https://www.photosecrets.com/the-rise-and-fall-of-kodak [2] http://www.in2013dollars.com/1993-dollars-in-2018?amount=31000000000 http://www.in2013dollars.com/1993-dollars-in-2018?amount=310... [3] https://www.researchandmarkets.com/reports/4514578/digital-camera-market-global-industry-trends https://www.researchandmarkets.com/reports/4514578/digital-c...
- rangibaby 8y ago
  > (Though I would still worry. Tiny cell phone cameras are becoming better and better every year, and that's really a function of the sensors, which they buy from Sony.) Cellphone sensors are their biggest limiting factor. Specifically, the size. Apple already seems to have squeezed as much "photo" as it can out of its sensor+image processing combination, and is using its image processing for other things (3d photos, fake bokeh). 35mm is pretty much done too in terms of large advancements in basic photo IQ. Nikon's very first full frame camera (the D3) was already 90% of the way there, and for the last 10 years they have been squeezing that last 10% out. Fujifilm isn't even competing there - they have gone for a larger sensor out of the gate.
  - coldtea 8y ago
    >Fujifilm isn't even competing there - they have gone for a larger sensor out of the gate. 95% of Fujifilm's money is from smaller sensors. The niche "medium format" stuff aside, most of their cameras are APS-C.
- sschueller 8y ago
  Sadly a similar thing happened to Polaroid. They had some excellent chemists and from what I heard from former employees it that they where able to create almost anything.
otterpro 8y ago
In the early 90's, when we were all using film cameras, everyone I knew, at least those who were pro or serious amateur/prosumers, used the legendary Fujifilm's Fujichrome Velvia 50 film. It became an instant hit because of its sharpness (fine grain) and color saturation that made us say "wow". It's hard to imagine what that's like, but think of it as having higher megapixels and better dynamics and great color. We used it especially for portrait/fashion and wildlife/nature. When it came out, a lot of us stopped using the classic Kodachrome/Ektachrome.
- ghaff 8y ago
  That's one view. I honestly never understood the attraction of Velvia 50. I know it was beloved of people who were better photographers than I.But I'd use Kodachrome 25 (which had a similar effective film speed) any day.The greens and blues of Velvia always seemed fake. In any case, both of those were niche films for pros and a few prosumers.
  - melloclello 8y ago
    Velvia makes people look far too red in the face.
    - aaronbrethorst 8y ago
      You should use Provia for portraits, not Velvia. Velvia, as you note, has a strong magenta cast.
  - deleted 8y ago
    [deleted]
  - gmiller123456 8y ago
    My, and most photographers I knew, reason for choosing Velvia was that you could develop it yourself. Kodachrome could only be developed by Kodak, but from what I've read about it, it was far superior in every other technical aspect. But not being able to control the push/pull of the development process really limited creative control over the whole process and was a more severe limitation than the higher resolution and color depth that Kodachrome provided. The way I saw it, Kodachrome was more for consumers who just wanted to press a button and have it done. And Fujichrome was for people who took the process much more serious. Because they could do more with the "inferior" product than relying on the one-size-fits-all commercial process.
person_of_color 8y ago
Anyone have an inside scoop on where to buy cheap recently expired film online?
- asow92 8y ago
  Why buy expired when you can buy it fresh? Kodak just reintroduced Ektachrome after discontinuing it in 2013!
  - Markoff 8y ago
    for artistic effect i guess
- abruzzi 8y ago
  It's scattered. Recently ~6 month old Velvia and Provia were selling for half price at one of the big NY retail outlets. Film Photography Project frequently has stuff thats expired. eBay has a lot, but it sells for way too much. The death of film (and Kodak) is oversold though. There is still quite a variety available new, and Kodak Alaris still makes a bunch of their classics including TriX and TMAX100 and 400. TMAX P3200 and Ektachrome was just rereleased. Ilford has a lot of B&W films, Maco is manufacturing Rollei, Agfa, and other films. Foma, Adox are still making great films. Fuji has, sadly been scaling back, but they still make slide film and color negative film (and lots of instant film.) Very few film cameras are made, mostly because there is a glut of used cameras that can be bought cheap, few manufacturers could compete (and volume would be very low.) My hope is that at least for the foreseeable future, the film market has stabilized into something sustainable, since I love the film process and that's all I shoot.
emmelaich 8y ago
My first digital camera was a Fuji. It was reviewed to have better colour than pretty much any other digital camera at the time.
mymythisisthis 8y ago
Fujifilm got billions of dollars in secret money from the Japanese government, and hide billions more on the books. This is Japanese culture, they would not let such an important company die. On the other hand, sure Kodak died, but the Americans now have Apple and Google - while Japan doesn't.
- megy 8y ago
  Isn't that like the air carriers in the US?
  - mymythisisthis 8y ago
    Yes...and Samsung...the 2008 bailout of many American car companies...Trump using 'national security' in the trade war with Canada...Germany and VW...(nobody plays fair). Read about the Olympus scandal for how another film company hung around. https://en.wikipedia.org/wiki/Olympus_scandal https://en.wikipedia.org/wiki/Olympus_scandal
- coldtea 8y ago
  >This is Japanese culture, they would not let such an important company die. So like what those pesky Japanese did when they gave 1 trillion to the financial sector? Or 1 trillion to Detroit car companies? Or tons of subsidies in agriculture and across all kinds of sectors? Oh, wait...
nicolas_t 8y ago
A problem that's alluded to in the article is that Kodak didn't focus on the high end of digital cameras nor in the sensors and components. So even as an imaging company they didn't understand that focusing on the low margin mass market they would be doomed eventually when cheaper mass market product would come out.
- kevin_thibedeau 8y ago
  Kodak did have high end sensors. They just never developed them for mass market applications. Much of the satellite imagery on Google maps is via Kodak hardware.
rbanffy 8y ago
Well... When film was not a retro thing, I always preferred to use Fuji film over Kodak - the results were just better, with Fuji capturing the lighting the way I intended it to. It's not only that Fuji picked the pivot to digital and Kodak didn't, but it felt they were always committed to solve my problem rather than to milk me for money. Kodak was too comfortable.
- Steve44 8y ago
  I'm the same for colour, I used Velvia for slides and the Fuji 400 for prints. I preferred the way Fujiy looked. B+W was either Kodak or Ilford from what I remember though.
schwinn 8y ago
> Retrospectively, Mr. Shih, the former VP of Kodak thinks that the company “could have tried to compete on capabilities rather than on the markets it was in” like Fujifilm did but “this would have meant walking away from a great consumer franchise. That’s not the logic that managers learn at business schools, and it would have been a hard pill for Kodak leaders to swallow.” It's a classic case study best told in the book, "Who moved my cheese?" Walking away from the consumer business would have been an abrupt about-face and forced a massive shift within the sales and marketing teams... they very people responsible for maintaining the Kodak brand.

169 points by bleair 8y ago

Good in-depth and balanced piece. (Although it does gloss over a little some of the struggled Fujifilm had during the transition from film.)

jrockway 8y ago

I think Kodak merely picked the wrong pivot. They thought they were a photography company, but they were actually a chemical company. There is plenty of demand for chemicals these days, and if they had stuck with that, they'd be doing fine. (I think these days they brand themselves as an "imaging" company, and they sell products like document capture systems. But that really makes them a software company, and I doubt they're doing great there. Document capture will probably be taken over by phones; Google is already playing with that and I'm guessing they have better software development teams than Kodak.) Fuji was in a similar place, of course, but they were already making high-end cameras and they were selling well. I use a GW690ii from 1985 regularly and it has one of the best lenses I've ever used. They did not forget how to manufacture those over the intervening 30 years, and there is plenty of market for lenses. (Though I would still worry. Tiny cell phone cameras are becoming better and better every year, and that's really a function of the sensors, which they buy from Sony.) Ironically, Fuji did kind of screw over the film photography community recently. They stopped making 4x5 Velvia 50. They stopped making Acros 100. Now everyone is using Kodak or Ilford film. But it's because they could afford to, getting someone to buy a new digital camera every couple years is way more profitable than making chemicals for a super niche industry. Kodak still doesn't understand that, but they do get some of my money as a result ;)

cuecrkofhdbe 8y ago
The chemical division of Kodak, Eastman Chemical, was spun off in 1994 and is doing well. https://www.reuters.com/article/us-eastman-kodak-idUSTRE7BN06B20111224 https://www.reuters.com/article/us-eastman-kodak-idUSTRE7BN0...
- simonh 8y ago
  So they divested themselves of the profit making part of their business and doubled down on the generic, modularised part of the business based on technologies they had no advantage in. Nice!
  - warrenm 8y ago
    Sounds like HP spinning-out Agilent, doesn't it?
  - emiliobumachar 8y ago
    What makes Eastman the spinoff and Kodak the "they" in your statement? The name? That should be 100% a branding decision, and presumably the Kodak name was more valuable attached to the mostly B2C camera business than to the mostly B2B chemical business. If not the name, then what is the token of "genuiness" that stayed with Kodak?
    - simonh 8y ago
      I’m going by the article. “Eastman Kodak spun off its chemicals business to help pay down debt.” At the time the CEO was quoted “Mr Whitmore, who has been under pressure to restructure Kodak, said Eastman Chemical would be spun off as an independent public company...”.
nicoburns 8y ago
Digital cameras are hardly a small market and they had the technology first. They just got stuck in the past.
- throwaway2048 8y ago
  The are a tiny market compared to kodak at its peak with film.
- coldtea 8y ago
  It doesn't have to be small in itself, just small in comparison to what Kodak did in the past, which is it.
kemiller 8y ago
Speaking as someone who had a second-row seat to Kodak's failure to meet the future, it was absolutely a case of stuck-in-the-past. The brass in Rochester just couldn't, wouldn't believe that the light at the end of the tunnel was a train, and they hobbled their own entries into that market at every turn.
- warrenm 8y ago
  Sadly, this sounds endemic of so many companies in NY
- abruzzi 8y ago
  I read somewhere, and sorry I don’t remember the source, that Kodak knew the digital future was coming, but they didn’t believe the speed with which it arrived. Kodak was one of the first companies with digital cameras.
  - kemiller 8y ago
    They were addicted to fat film profits and couldn’t read an exponential curve.
    - ghaff 8y ago
      That's probably true but good luck when your primary revenue source falls off an utter cliff which is basically what happened with film sales. You basically have to build a new $20 billion company within a few years.
      - kemiller 8y ago
        Oh yeah I get it. They were in a tough spot. But they still almost went out of their way, it felt like, to screw with the parts of their business that were trying to save them.
    - throwaway2048 8y ago
      Kodak was larger than the entire digital camera industry currently is, by almost 3x, $31 billion[1] in 1993 dollars which is 31 billion in 54 billion in 2018 dollars[2]. The entire digital camera industry was worth about 18 billion in 2017[3] Even if they captured 100% of the market (which would have been basically completely impossible), it would have been a massive disaster for them as a company, and to the hundreds of thousands of people they employed in photo processing. [1] https://www.photosecrets.com/the-rise-and-fall-of-kodak https://www.photosecrets.com/the-rise-and-fall-of-kodak [2] http://www.in2013dollars.com/1993-dollars-in-2018?amount=31000000000 http://www.in2013dollars.com/1993-dollars-in-2018?amount=310... [3] https://www.researchandmarkets.com/reports/4514578/digital-camera-market-global-industry-trends https://www.researchandmarkets.com/reports/4514578/digital-c...
rangibaby 8y ago
> (Though I would still worry. Tiny cell phone cameras are becoming better and better every year, and that's really a function of the sensors, which they buy from Sony.) Cellphone sensors are their biggest limiting factor. Specifically, the size. Apple already seems to have squeezed as much "photo" as it can out of its sensor+image processing combination, and is using its image processing for other things (3d photos, fake bokeh). 35mm is pretty much done too in terms of large advancements in basic photo IQ. Nikon's very first full frame camera (the D3) was already 90% of the way there, and for the last 10 years they have been squeezing that last 10% out. Fujifilm isn't even competing there - they have gone for a larger sensor out of the gate.
- coldtea 8y ago
  >Fujifilm isn't even competing there - they have gone for a larger sensor out of the gate. 95% of Fujifilm's money is from smaller sensors. The niche "medium format" stuff aside, most of their cameras are APS-C.
sschueller 8y ago
Sadly a similar thing happened to Polaroid. They had some excellent chemists and from what I heard from former employees it that they where able to create almost anything.

otterpro 8y ago

In the early 90's, when we were all using film cameras, everyone I knew, at least those who were pro or serious amateur/prosumers, used the legendary Fujifilm's Fujichrome Velvia 50 film. It became an instant hit because of its sharpness (fine grain) and color saturation that made us say "wow". It's hard to imagine what that's like, but think of it as having higher megapixels and better dynamics and great color. We used it especially for portrait/fashion and wildlife/nature. When it came out, a lot of us stopped using the classic Kodachrome/Ektachrome.

ghaff 8y ago
That's one view. I honestly never understood the attraction of Velvia 50. I know it was beloved of people who were better photographers than I.But I'd use Kodachrome 25 (which had a similar effective film speed) any day.The greens and blues of Velvia always seemed fake. In any case, both of those were niche films for pros and a few prosumers.
- melloclello 8y ago
  Velvia makes people look far too red in the face.
  - aaronbrethorst 8y ago
    You should use Provia for portraits, not Velvia. Velvia, as you note, has a strong magenta cast.
- deleted 8y ago
  [deleted]
- gmiller123456 8y ago
  My, and most photographers I knew, reason for choosing Velvia was that you could develop it yourself. Kodachrome could only be developed by Kodak, but from what I've read about it, it was far superior in every other technical aspect. But not being able to control the push/pull of the development process really limited creative control over the whole process and was a more severe limitation than the higher resolution and color depth that Kodachrome provided. The way I saw it, Kodachrome was more for consumers who just wanted to press a button and have it done. And Fujichrome was for people who took the process much more serious. Because they could do more with the "inferior" product than relying on the one-size-fits-all commercial process.

person_of_color 8y ago

Anyone have an inside scoop on where to buy cheap recently expired film online?

asow92 8y ago
Why buy expired when you can buy it fresh? Kodak just reintroduced Ektachrome after discontinuing it in 2013!
- Markoff 8y ago
  for artistic effect i guess
abruzzi 8y ago
It's scattered. Recently ~6 month old Velvia and Provia were selling for half price at one of the big NY retail outlets. Film Photography Project frequently has stuff thats expired. eBay has a lot, but it sells for way too much. The death of film (and Kodak) is oversold though. There is still quite a variety available new, and Kodak Alaris still makes a bunch of their classics including TriX and TMAX100 and 400. TMAX P3200 and Ektachrome was just rereleased. Ilford has a lot of B&W films, Maco is manufacturing Rollei, Agfa, and other films. Foma, Adox are still making great films. Fuji has, sadly been scaling back, but they still make slide film and color negative film (and lots of instant film.) Very few film cameras are made, mostly because there is a glut of used cameras that can be bought cheap, few manufacturers could compete (and volume would be very low.) My hope is that at least for the foreseeable future, the film market has stabilized into something sustainable, since I love the film process and that's all I shoot.

emmelaich 8y ago

My first digital camera was a Fuji. It was reviewed to have better colour than pretty much any other digital camera at the time.

mymythisisthis 8y ago

Fujifilm got billions of dollars in secret money from the Japanese government, and hide billions more on the books. This is Japanese culture, they would not let such an important company die. On the other hand, sure Kodak died, but the Americans now have Apple and Google - while Japan doesn't.

megy 8y ago
Isn't that like the air carriers in the US?
- mymythisisthis 8y ago
  Yes...and Samsung...the 2008 bailout of many American car companies...Trump using 'national security' in the trade war with Canada...Germany and VW...(nobody plays fair). Read about the Olympus scandal for how another film company hung around. https://en.wikipedia.org/wiki/Olympus_scandal https://en.wikipedia.org/wiki/Olympus_scandal
coldtea 8y ago
>This is Japanese culture, they would not let such an important company die. So like what those pesky Japanese did when they gave 1 trillion to the financial sector? Or 1 trillion to Detroit car companies? Or tons of subsidies in agriculture and across all kinds of sectors? Oh, wait...

nicolas_t 8y ago

A problem that's alluded to in the article is that Kodak didn't focus on the high end of digital cameras nor in the sensors and components. So even as an imaging company they didn't understand that focusing on the low margin mass market they would be doomed eventually when cheaper mass market product would come out.

kevin_thibedeau 8y ago
Kodak did have high end sensors. They just never developed them for mass market applications. Much of the satellite imagery on Google maps is via Kodak hardware.

rbanffy 8y ago

Well... When film was not a retro thing, I always preferred to use Fuji film over Kodak - the results were just better, with Fuji capturing the lighting the way I intended it to. It's not only that Fuji picked the pivot to digital and Kodak didn't, but it felt they were always committed to solve my problem rather than to milk me for money. Kodak was too comfortable.

Steve44 8y ago
I'm the same for colour, I used Velvia for slides and the Fuji 400 for prints. I preferred the way Fujiy looked. B+W was either Kodak or Ilford from what I remember though.

schwinn 8y ago

> Retrospectively, Mr. Shih, the former VP of Kodak thinks that the company “could have tried to compete on capabilities rather than on the markets it was in” like Fujifilm did but “this would have meant walking away from a great consumer franchise. That’s not the logic that managers learn at business schools, and it would have been a hard pill for Kodak leaders to swallow.” It's a classic case study best told in the book, "Who moved my cheese?" Walking away from the consumer business would have been an abrupt about-face and forced a massive shift within the sales and marketing teams... they very people responsible for maintaining the Kodak brand.