An interesting article that refutes the conventional wisdom:
The standard line is that Kodak collapsed by failing to anticipate the digital revolution.
It turns out that is almost the opposite of the truth. Kodak did anticipate the market. By 2005 Kodak was the leader in digital cameras, and had developed thousands of booths wherein people could produce HQ prints from their digital images. The problems were:
(1) There was absolutely no profit in selling digital cameras. The Kodak management might have considered this more thoughtfully, since they were in the very best position in the world to know that they had never made a profit selling any kind of camera. In the analog market, the idea was to give cameras away in order to get people taking pictures, thence to make vast profits selling film. So how does one make big-time profits in the photography biz if there is no film?
(2) The digital print-out business was semi-successful for a while, but Kodak did not anticipate the “sharing” craze on the internet. People don’t print pictures at all these days – they share them on social media.
In other words, they failed because they DID anticipate the digital revolution, and jumped into it because they wanted to continue to dominate the photography business. What they failed to see was that there would no longer be any significant profit in that business.
Fuji, on the other hand, did see the handwriting on that wall. Within a short time they had diversified so dramatically that the imaging business was only 16% of the company. Today, they are bigger than they were in 2000. Kodak, meanwhile, is virtually non-existent. In 1982 they employed more than 60,000 people in the Rochester area alone. Today that number is about 2,000, mainly consisting of patent attorneys and the people who oversee and maintain their empty buildings.
You can imagine how the loss of 58,000 jobs in one medium-sized city impacted the local economy. That’s my home town.
But that’s a story for another day.
58,000 jobs… Sounds like Little Chicago…