An Analysis of the Causes of Kodak’s Failure in Modern Photography

This essay explores the reasons behind Kodak's failure in the modern photography industry, despite its initial dominance. The primary cause was Kodak's inability to adapt to the rise of digital photography, driven by a focus on its existing film-based revenue model and a failure to anticipate future ...Read More

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Title: What were the causes of Kodak’s failure in the modern photography
industry?

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Contents
1. INTRODUCTION...................................................................................................................................3
2. Causes for Kodak’s failure....................................................................................................................3
3. Conclusion...........................................................................................................................................6
4. References...........................................................................................................................................7

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What were the causes of Kodak’s failure in the
modern photography industry?
1. INTRODUCTION
Few decades ago, a “Kodak moment” was worth savoring and saving something, but
today it reminds the corporate mistake where company executives failed to respond the
need for disruptive innovation. 110 years old company Kodak was blinded by its
success missed the rise in the use of innovation and technology. The result was the
failure it faced due to lagging behind in the competition that other smaller companies
gave in the photography industry. The major player of the photography industry had to
sell its patents to come out of the bankruptcy (Anthony, 2016). The paper given below
identifies the reasons due to which Kodak failed in finding the desired market in the
photography industry.
2. Causes for Kodak’s failure
Established in the year 1888, the Kodak company held the dominant position in the
photographic film industry for most of the 20th century. Late 90s introduced the digital
photography to the consumers and Kodak started facing the struggle financially. The
reason was majorly the lateness of the company in transitioning to digital photography
platform. Kodak has built a monopoly in the photography industry that shattered with the
entry of digital cameras (Lucas & Goh, 2013). The reasons that the company failed are
discussed in detail here: -
2.1. Kodak was unable to see future demands and expectations- Caught in
time of success the company management failed to grasp the changing

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industry and involvement of innovation and technology around the world.
They have a firm belief that they know who takes pictures, when and why.
They never believed that the user could get away from the hard prints and
look for easy methods for taking a picture and better picture quality. For them
the digitization was limited to the film-based photography. Digital cameras
took over the market and Kodak became a lost name. Once awake the
company invested in the technology, created the digital camera, and even
acknowledged the world for sharing photos online. But they failed again as it
was too late and the digital technology and concept for sharing photos was
not a new thing then (Munir, 2012).
2.2. Cost- The major revenue for the company was generated from the printing
process and not from the sale of cameras. The increased use of innovation
allowed the new small companies enter the market with cameras at very low
prices with increased memory to capture the images. If believed it was not the
cameras but printing that led the company towards bankruptcy.
CEO George Fisher saw the invasion of digital photography but managed to
ignore that fact and invested $2 billion on the research and development for
digital imaging. The complex procedure of printing needs film of $150 plus
processing chemicals, dark room, which will cost another $125 to a person for
a limited number of prints. On the other hand, the digital camera which was
available for $78 needs just a need to click with no limit (C. Mui,2012).
Resulting people started opting for the digital cameras.

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2.3. Associated factors- Protection is the factor that affected the choice of the
user while purchasing the cameras. Film cameras need better protection than
the digital cameras as they are sensitive to light, hence its cover will cost from
about $10 to $ 500. The durability of the digital camera made people opt for
them as they easy to handle. Also, one has to get the film processed into hard
prints to see the pictures and later they have to be kept safe along with the
negatives for future use. Processing of film was not an easy process and
cannot be done anywhere, hence the expense of darkroom should also be
bared (J Dodd, 2012).
2.4. Market- Once identified the innovation the company tried to enter the digital
market with digital cameras, but could not find the market for the product
across the world apart from the US. It turned out to be biggest failure for the
company and its started bleeding money. Resulting company got bankrupt
(KMIA, 2018).
The above-given factors show various reasons to elaborate on the reason why
Kodak was a failure in the modern photography. The company has tried to work on the
steps to capture the market with digital cameras, but it was too late for the company to
develop a market for its products as the other smaller companies have already made
their brand image and captured the targeted market.
3. Utility
A regular Kodak film role has a limited number of pictures to click as compare to the
space of the memory card of a digital camera. The quality of the pictures taken by digital
cameras are also much superior as compared to the film role Kodak camera (Najrani,

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2016). The user can view the picture taken on the digital camera and delete the ones
which are not focused or useful. This facility is not available on the Kodak film role
camera. The pictures clicked using the digital camera can be stored in a computer
system. A small space on computer can keep a very large number of pictures safe for
life. Whereas in case for the Kodak film role cameras the pictures need to printed and
then kept in heavy albums to avoid spoilage which adds to the cost for maintenance (M
Bunchmann, 2018).
4. Conclusion
Each industry is identifying the Innovation as a vital factor therefore incorporating it
in their business models. The ruler of the photography industry Kodak had a major set
back when it failed to identify the disruptive innovative and use of technology in the
modern photography. The memory space, picture quality, costing, utility, user demands,
durability, and performance are some factors those turn out to be the reason to through
the company out of the race of photography industry. Hence, it is clear that the lack of
futuristic approach and identifying the consumer needs in innovation is the reason that
the Kodak company failed in the modern photography industry.

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5. References
Anthony, S. (2016). Kodak’s Downfall Wasn’t About Technology. Retrieved from
https://hbr.org/2016/07/kodaks-downfall-wasnt-about-technology
C Mui, (2012) How Kodak Failed, Retrieved on November 17, 2018 from
https://www.forbes.com/sites/chunkamui/2012/01/18/how-kodak-failed/
#fa4661b6f27a
J Dodd, (2012) The True Cost of Filmmaking in the 21st Century, Retrieved on
November 17, 2018 from https://jamesriverfilm.wordpress.com/2012/10/25/the-true-
cost-of-filmmaking-in-the-21st-century/
KMIA, O. (2018). Why Kodak Died and Fujifilm Thrived: A Tale of Two Film Companies.
Retrieved from https://petapixel.com/2018/10/19/why-kodak-died-and-fujifilm-
thrived-a-tale-of-two-film-companies/
Lucas, H., & Goh, J. (2013). Disruptive technology: how Kodak missed the digital
photography revolution. IEEE Engineering Management Review, 41(4), 81-93. doi:
10.1109/emr.2013.6693939
M Bunchmann, (2018) What energy utilities can learn from Kodak when it comes to
digitalization, Retrieved on November 17, 2018 from https://energypost.eu/what-
energy-utilities-can-learn-from-kodak-when-it-comes-to-digitalization/
Munir, K. (2012). The Demise of Kodak: Five Reasons. Retrieved from
https://blogs.wsj.com/source/2012/02/26/the-demise-of-kodak-five-reasons/

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Najrani, M. (2016). The endless opportunity of organizational agility. Strategic
Direction, 32(3), 37-38.