Kodak-- No further longterm investment in film

Sorry, I don't follow your logic, and I got the highest grade in my Logic
class in college. My guess is that since you cross posted this to/from the
digital group, then this is an elaborate troll. However, in the interests
of some accuracy, I have decided to type a short commentary.

Kodak recently opened a new factory dedicated to B/W film production.
Kodak also recently introduced several improved "professional" E6 films,
and Fuji has provided similar new E6 films. To put that into some context,
neither the B/W, nor the E6 films, sell in nearly the numbers that
"consumer" colour negative films receive. Indeed, why improve current
consumer films, when the sales and profits are really good. Film is very
profitable.

It is important to understand that Kodak, as a public company, is
responsible to their shareholders. With that in mind, the average
shareholder will want to see Kodak make more statements about greater
investing in digital technology, since shareholders will interpret this as
moving towards the future. Kodak will look much more like computer
companies a few years ago, though their views and statements will need to
change to accommodate shareholder perception.

You can easily read the SEC reports for Kodak. In those, you will find
that they make more money from non-consumer, non-film endeavours, though
those are rarely discussed. You will also find that digital endeavours
have a very low profit margin, and that things like disposable cameras,
and consumer films have very high profit margins.

Bottom line is that film will survive as long as it generates a profit.
Technology is not driven by innovation, it is driven by profits.

Ciao!

Gordon Moat
Alliance Graphique Studio
<http://www.allgstudio.com>

 

In a first page article in today's Wall Street Journal, it is reported
that Kodak has made a significant strategic decision to make no further
long term investment in consumer film. They plan to concentrate on
digital photography and non-photo areas.

This means that while digital photography is rapidly advancing, film
improvements, at least from Kodak, will be limited. With its major
competitor out of action, that could mean that Fuji has less incentive
to pour more research into film also.

If that is the case, many photographers, myself included, are unlikely
to make any further significant long term investment in film
photography.

Bill Janes

 

I'd be concerned if Kodak said they would stop investment for all films,
since pros use most of the film anyway. Their consumer films stink anyway.

 

Perhaps they are starting to look too much like a computer company.

Maybe this indicates that shareholders feel that further development of
"consumer" films would be a better direction. More likely, this latest
statement shows a lack of direction, and too much jumping on the latest buzz
word band wagon . . . seems too much like when everyone wanted to put "dot com"
onto their name to increase share prices.

Anyway, I doubt either of us would judge any company by one day stock
performance. Did you sell any shares today?

Ciao!

Gordon Moat
Alliance Graphique Studio
<http://www.allgstudio.com>

 

The pro per-centage of sales for Kodak is extremely small. Has been for
years, something like less than 10% of total film sales.

 

Professional films are about 7 percent of Kodak's market. The rest is
amateur films. I tend to wonder what "advances" they plan in professional
films since that segment of teh market is going digital at as fast or faster
a rate than the amateurs.

--
http://www.chapelhillnoir.com
home of The Camera-ist's Manifesto
The Improved Links Pages are at
http://www.chapelhillnoir.com/links/mlinks00.html
New email - Contact on the Menyou page.

 

I am not sure about your or the Journal's interpretation of the facts,
but from a photo stand point it is only an acknowledgment that film is a
mature well developed product that does not need much in any additional
development. On the other hand digital is a new product and has a lot of
room for improvement and innovation.

 

There exists no product that can't benefit from continued improvment in
quality, be it quality of manufacturing, features, variety,
service,...there is always, always, always room for improvement...

Cheers,
Alan

 

The digital sensor is the new film.

Investing in digitial sensor R&D is the
new film R&D.

Kodak, Fuji, Canon, Sony, and Nikon
all know this.

 

Yeah, that worked ... tanked almost 1/5 of sharholder value today.

That's over a billion bucks of shareholder confidence gone somewhere else.

Cheers,
Alan.

 

It has hit the law of diminishing returns. You could spend a lot of
money to improve on the basic broom, but it would be hard to get a return on
your investment in the market place. It would also be hard to improve on
it.

Can film be improved, sure. How much, well ..... Not much considering
the amount of research likely needed and the possible return on that
investment.

On the other hand digital is almost certain to improve, and someone will
get a good return on the investment, and others will be forgotten.

 

The improvements made to C-41 negative film in the last ten years have
been absolutely amazing. Just compare the current Royal Supra 200 to the
ISO200 or even 100 emulsions of 1993.

Ralf

 

When was Ektar 25 produced again? ;-)
Slow, true, but not bad. Not bad at all.

 

Frankly the last color film I really liked was Etkar 25.

 

But, if digital is supposed to be so CHEAP...supposed to save the user so
much money (because they don't have to buy film and have it processed)...
Does Kodak think that they are going to make MORE money from digital than
film and so justify a major shift in corporate focus?

You can't have it both ways!! Either digital is CHEAPER (which means the
user will be giving LESS money to Kodak) OR digital is more EXPENSIVE
(which means that the user is going to give Kodak MORE money). I hardly
think that Kodak wants to shoot itself in the foot by cutting off a major
revenue source (don't forget how much of a financial burden it is to have to
buy a roll of film!) in favour of one that brings in LESS money. I think
that Kodak knows that digital IS more expensive to own and operate and they
have made a strictly monetary decision and not done a 'public service'.

To paraphrase Ruskin: " There is hardly anything in the world that some man
cannot make a little worse and sell a lot higher."

 

I wonder if those were the same shareholders that OK'd the creation of "New
Taste Coke"?

 

You don't think that it was because they cut the shareholder dividend to
1/4 of what it had historically been, and that S&P downgraded their
shares to just above junk bond status?

 

I don't think the shareholders really care about what Kodak do vis-a-vis
film, I think the shareholders want to hear how Kodak are going to
increase shareholder value.

Lack of direction? Yes indeed ... but also a market that is saying,
"Look guys, you've told us your plan, and we think other people have
better plans."

I don't know ... I'd have to ask my MF managers, and I only talk to them
every 3 or 6 months... it is almost certain that bargain hunters are
going to snap up some of those shares tomorrow morning... but over the
past few years Kodak's share price has been steadily eroding... On bad
news we often see stocks take a bath ... but 18% is HELLUVA a signal
based on a press release prior to a GM.

Cheers,
Alan

 

That is like McDonalds not making burgers any more!