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Kodak to stop making digital cameras

By dpreview staff on Feb 9, 2012 at 19:17 GMT

Kodak will stop making digital cameras within the next few months. The company, currently in bankruptcy protection, will also stop making pocket video cameras and photo frames as a cost-cutting measure. Instead it is looking to license its name to other manufacturers who wish to sell cameras under the Kodak brand. Closing the business will cost around $30m, mainly in the cost of laying-off workers, but will save around $100m per year in running costs. All product warranties will be honored.

There was an outburst of nostalgia when the company announced it was discontinuing its famous Kodachrome color film but today's announcement that one of the innovators in portable photography and digital camera technology is leaving the business is a sad one. The company's recent retreat into bankruptcy protection means this step won't come as a complete shock but, whatever now happens to the company, its link to everyday photography has been broken.


Press Release

Kodak Focuses Consumer Business On More Profitable Growth Opportunities

ROCHESTER, N.Y., February 09 -- 

Eastman Kodak Company (the “Company”) (OTB: EKDKQ.PK) announced today that, as a result of its ongoing strategic review process and commitment to drive sustainable profitability through its most valuable business lines, it plans to phase out its dedicated capture devices business – comprising digital cameras, pocket video cameras and digital picture frames – in the first half of 2012. Kodak will instead expand its current brand licensing program, and seek licensees in these categories. Following this decision, Kodak’s Consumer Business will include online and retail-based photo printing, as well as desktop inkjet printing.  

Kodak has contacted its retail partners, and is working closely with them to ensure an orderly transition. Kodak will continue to honor all related product warranties, and provide technical support and service for its cameras, pocket video cameras and digital picture frames.  

“For some time, Kodak’s strategy has been to improve margins in the capture device business by narrowing our participation in terms of product portfolio, geographies and retail outlets. Today’s announcement is the logical extension of that process, given our analysis of the industry trends,” said Pradeep Jotwani, President, Consumer Businesses, and Kodak Chief Marketing Officer.   

Upon completion of the phase out, Kodak expects to achieve annual operating savings of more than $100 million. Kodak expects to incur a charge related to separation benefits of approximately $30 million resulting from the exit of the business.  

In addition to its Consumer Businesses segment, Kodak has a Commercial Businesses segment that includes the Digital and Functional Printing, Enterprise Services and Solutions, and Graphics, Entertainment and Commercial Films units. Kodak’s digital businesses now comprise approximately three-fourths of total revenues.          

Kodak continues to have a strong position in the personal imaging market.  While photos are increasingly taken on multi-function mobile devices, Kodak technology makes it easy for consumers to produce a broad range of photo products, anywhere, anytime – from prints to photobooks, photo greeting cards and personalized calendars. These items can be made on Kodak products, with Kodak quality at retail, at home, and ordered for delivery to home.   

Kodak’s continuing consumer products and services will include:  

  • Retail-based photo kiosks and digital dry lab systems, a market in which Kodak is the clear worldwide leader. Kodak pioneered the retail-based kiosk market, and the company now has more than 100,000 kiosks and order stations for dry lab systems around the world, with some 30,000 of those units connected to the most popular photo-sharing sites.  
  • Consumer inkjet printers, where Kodak has outpaced overall market growth for several years. Kodak consumer inkjet printers provide consumers with high-quality output and the lowest total ink replacement cost. Consumers can send documents and photos to Kodak printers from anywhere, using any web-connected device.  
  • Kodak apps for Facebook, which make it easy for consumers to obtain photo products using photos from their Facebook albums.  
  • Kodak Gallery (www.kodakgallery.com), a leading online digital photo products service. Kodak Gallery enables consumers to share their photos, and offers product and creation tools that enable people to do more with their photos.  
  • The Kodak camera accessories and batteries businesses. These products are universally compatible with all camera brands, and extend into other consumer product segments such as charging units for smartphones.  
  • The traditional film capture and photographic paper business, which continues to provide high-quality and innovative products and solutions to consumers, photographers, retailers, photofinishers and professional labs.

Comments

Total comments: 146
12
Deleted1929
By Deleted1929 (Feb 9, 2012)

The loss of those jobs will be devastating to those involved. Outside of that this news makes no difference to me or, I suspect, the majority of people using cameras today.

It's a sign of how ill-prepared the Kodak board are for restructuring that they don't seem to have a way to redeploy those employees to something else. After years of pretty much everyone warning of the coming fall Kodak's only response has been to sell off assets and fire people. No planning for future R&D seems to have been in place, let alone a forward looking plan for alternative business. Surely this can only mean that the slide down will continue ?

2 upvotes
James Van Artsdalen
By James Van Artsdalen (Feb 9, 2012)

The CEO is admitting there is no plan to save the company and all they hope to do is just stick around and collect executive bonus payments as long as possible before liquidating the company.

6 upvotes
Deleted1929
By Deleted1929 (Feb 9, 2012)

Sounds like it to me, too.

1 upvote
starwolfy
By starwolfy (Feb 9, 2012)

It is useless to make plans if you do not have cash.
They are just trying to find ways to make cash, or at least, stop losing it. That is the reason why they are stoping all departments which are not profitable or not profitable enough. That is also the reason why they will fire many people. They need to make the company operational costs to be ligther.
Any CEO would do the same in such case.

0 upvotes
migus
By migus (Feb 10, 2012)

their IP portfolio will likely remain lucrative, but to others...

0 upvotes
slncezgsi
By slncezgsi (Feb 9, 2012)

I feel sorry for all those that will loose their jobs, but I do not recall Kodak producing interesting compact digital cameras in several years (or was it just a marketing failure?) and there were no DSLRs in a long time. I wonder what went wrong with their high-end digital market.

0 upvotes
Peter Nelson
By Peter Nelson (Feb 9, 2012)

Kodak's high end digital market, the DSLR market was a contest between one single American DSLR camera maker Kodak the inventer against all of Japan and it's DSLR makers, especially Canon and Nikon.
Kodak invented digital photography and the DSLR. However they had to outscource DSLR parts from Japan as there were no American companies that were assisting Kodak in the mfr process. Once the Japaneses were able to make their own sensors they "Slit Kodak's" throat by not suppling any more bodies. Nikon even went so far as to instruct the NYC Nikon importer to stop suppling Rochester N.Y. Kodak with any additional Nikon film bodies. Koday had to actually go into NYC and purchase Nikon film camera bodies in a store and then turn them into Kodak DSLR's. Tough to survive doing that.
I have a Full Frame 14MP Kodak DSLR the SLR/n and I would not trade it for anything. It's good enough in operation, the IQ is definetly good enough or better than other DSLR's and the body size is perfect for me.

4 upvotes
DioCanon
By DioCanon (Feb 9, 2012)

always blaming someone else...

7 upvotes
Peiasdf
By Peiasdf (Feb 10, 2012)

Sounds like Peter Nelson has personal issues. Holding on to a SLR/n as a holy grail.

1 upvote
EcoPix
By EcoPix (Feb 11, 2012)

I also had an SLR/n (served me well – beautiful colour and tone at base ISO), and followed its ill-fate. A potted history of the death of Kodak pro cameras:
1. Kodak 14n released, full frame 14mp MF quality, but the buffer was inadequate and the sensor terribly noisy above base ISO.
2. Pros who spent big bucks buying it found it faulty, and complained to Kodak.
3. Kodak added buffer and redesigned sensor, which they claimed fixed the noise, but instead of recalling the cameras, charged everyone a hefty upgrade fee on top of a very expensive camera.
4. Almost the entire pro photo industry got its nose out of joint, but had to upgrade to 14nx (the factory modified cameras) or SLR/n, the new model.
5. The camera was still very slow and noisy!
6. Everyone deserted Kodak for very mediocre Japanese DSLRs, because (a) at least they could use 400ISO, and (b), by this time they hated Kodak!
7. Kodak disbanded its pro camera division.
Now does that sound like a well-run company?

0 upvotes
wyoming
By wyoming (Feb 9, 2012)

it's a shame!!
to me is an error the decision, i think there is actually the space on the market to sell simple and sensible cameras at a price lower than the big names.
obviously you have to have a good product not like the last cameras they put out.

0 upvotes
TxCamFan
By TxCamFan (Feb 9, 2012)

Very glad they are still going to make film but such a shame it's come to this from where the company started.

0 upvotes
Cineski2
By Cineski2 (Feb 9, 2012)

They're still going to make film!!!

1 upvote
TxCamFan
By TxCamFan (Feb 9, 2012)

This is sad and outrageous that those in charge of this once great company have decimated it like this. :(

3 upvotes
Klarno
By Klarno (Feb 9, 2012)

Eh. As long as I can still buy Tri-X 400 I'll be happy.

0 upvotes
chris00nj
By chris00nj (Feb 9, 2012)

Kodak made low quality digital cameras in the tradition of the Instamatic and box brownie. However, very low end cameras are being replaced by cameras on phones.

Kodak has no camera in the semi-pro range, so there was no way to go up market with Kodak.

There is no reason why Kodak couldn't have produced something like the Sony NEX.

3 upvotes
cesaregal
By cesaregal (Feb 9, 2012)

My best photographs since 40 years are on old Kodachrome 25 slides.
I still have my brilliant Kodachrome 25 slides.
Best natural colors.
Better than actual cameras can, in my opinion.
Thank you Kodak.

1 upvote
Joe Ogiba
By Joe Ogiba (Feb 9, 2012)

The Kodak name on a P&S is worth about the same as Argus, Bell & Howell or Memorex....zip.

4 upvotes
Pencilvania
By Pencilvania (Feb 9, 2012)

What I find interesting is that no one is mentioning Kodak's chip manufacturing. Kodak produces and develops most of the leading sensors, the Leica M9's among them. The sales of that division is what will affect current digital photography the most. The beginning of the end of Kodak was not when the company filed for Chapter 11, it was the sale of their sensor division some months ago.

I sympathize with the death of film but it was simply that, a fast decline into a niche. Like Hasselblad, Kodak did not adapt to the ongoing trend in the photographic world in a quick enough time frame. Hasselblad was on the brink of closure for many years after a number of mistakes executed by a foolhardy CEO at the helm. Somehow I doubt Kodak didn't see this coming.

4 upvotes
psn
By psn (Feb 9, 2012)

Film is not dead nor does it need your sympathy. The market has shrunk to the point that Kodak can't make money off it but it's still there and it's doing just fine.

If you need proof just check the film groups in flickr!, lomography, and other photo sharing sites.

5 upvotes
86
By 86 (Feb 9, 2012)

they sold off the sensor business a while ago.

1 upvote
BJL
By BJL (Feb 9, 2012)

Kodak has already sold its sensor division, before the bankruptcy: it is about to restart under the company name TrueSense Imaging:
http://www.kodak.com/ek/US/en/Image_Sensor_Solutions/Kodak_Image_Sensor_Solutions.htm
http://www.truesenseimaging.com/

Comment edited 30 seconds after posting
1 upvote
Francis Carver
By Francis Carver (Feb 10, 2012)

I just "love" how some folks can make up any number of sentences with the words "death of film" and "film is dead" used to no end. How refreshing.

You mean that stuff I read someplace recently how "digital is dead" was untrue?

0 upvotes
guillealv
By guillealv (Feb 9, 2012)

i am soooo relieved to know that i will still be able to buy B/W Tmax film and the developing liquids.... film photography can perfectly live together with digital, just like an artist can paint with oil or water colours.

1 upvote
gillamoto
By gillamoto (Feb 10, 2012)

I totally agree with you. digital is good, but it doesn't replace or kill film. both are usable mediums for different purpose and taste. only those 'gadgeters' who think that film is dead, that film is history.

0 upvotes
Anastigmat
By Anastigmat (Feb 9, 2012)

Kodak was the early leader in DSLR cameras. They were building DSLRs using Nikon and Canon bodies that pros used to capture events such as the World Series. Unfortunately, they priced their DSLRs so high that ordinary folks could not afford them. That gave Canon an opportunity to come up with an "affordable" DSLR camera, the $3,000 D30. Canon soon followed with full frame DSLR cameras, leaving both Nikon and Kodak in the dust. At one point in time, shortly before Nikon released the D70, Canon had 80% of the DSLR market. Kodak simply could not compete. Kodak also made a full frame DSLR camera, but instead of using one of its own CCD sensors, it used a CMOS sensor designed and manufactured by an outside company to save cost. That sensor was so noisy that it doomed the camera. Besides, even with the cheaper CMOS sensor, the camera wasn't cheap. Quite simply, Kodak had a chance to be a player in the DSLR market but it made marketing mistakes by pricing their cameras too high.

Comment edited 21 seconds after posting
3 upvotes
Antonio Rojilla
By Antonio Rojilla (Feb 9, 2012)

What about the Nikon D1?

1 upvote
Charles V. Stancampiano
By Charles V. Stancampiano (Feb 9, 2012)

You are right. I was working at Kodak in the sensor division when the D1 came out. It was a shock to the status quo! Nikon camera with Sony sensor=death.

1 upvote
AbrasiveReducer
By AbrasiveReducer (Feb 9, 2012)

Of course the job loss is terrible. But other than that you have to wonder why they just arrived at this. When it comes to consumer photo products, consumables are the gift that keeps on giving. Even within consumables there's an interesting digital vs. analog dichotomy. People with inkjet printers constantly complain about the cost of the ink, while people who love film are happy to keep buying it.

0 upvotes
Apewithacamera
By Apewithacamera (Feb 9, 2012)

The D800E Effect continues

Comment edited 57 seconds after posting
2 upvotes
tkbslc
By tkbslc (Feb 9, 2012)

Kodak hasn't even attempted to compete with pro cameras for about a decade. I doubt Nikon had much to do with the demise. I'd be more apt to blame the iphone since most people who were using kodak digital where the point and click crowd.

0 upvotes
Krilnon
By Krilnon (Feb 9, 2012)

I assumed Apewithacamera was joking.

0 upvotes
gipper51
By gipper51 (Feb 9, 2012)

It's a sad day to see the company that was synonymous with photography in such a state. Few companies in history have had as much impact on their industry as Kodak. It's a shame.

Comment edited 46 seconds after posting
2 upvotes
Dan Nikon
By Dan Nikon (Feb 9, 2012)

Why, that they are getting out of the digital rat race? They are applying their strengths to their business model, and they make incredible films. I just got done printing an entire edition of 10 x 10's and 15 x 15's made on TMX, awesome stuff that digital can NOT touch when printed in a real darkroom.

2 upvotes
Charles V. Stancampiano
By Charles V. Stancampiano (Feb 9, 2012)

You are assuming that image quality matters in the consumer market. It doesn't. Crappy cell phone cameras are winning.

2 upvotes
Dan Nikon
By Dan Nikon (Feb 9, 2012)

Interesting that you left out the most important and best part, Kodak is still going to make film, a niche that serves them and Ilford well and keeps us real fine art photographers set with all the options we need to stay in business. Not that many on this site would care, but many of us pros use fillm along side of digital and will continue to do so. As cited in the BJP:

http://www.bjp-online.com/british-journal-of-photography/news/2145203/kodak-phases-digital-businesses-film-alive

Comment edited 2 times, last edit 1 minute after posting
7 upvotes
vtinitus
By vtinitus (Feb 9, 2012)

I do care, and so does my m42/1 system.

0 upvotes
Faintandfuzzy
By Faintandfuzzy (Feb 9, 2012)

Well said. I still like using film for certain projects. And maybe I'll need a darkroom again one day.

0 upvotes
Antonio Rojilla
By Antonio Rojilla (Feb 9, 2012)

"and keeps us REAL fine art photographers"

And there I stopped reading.

6 upvotes
EOSHQ
By EOSHQ (Feb 10, 2012)

I love the look of color and b&w negative film and while I definitely use and like DSLRs, film is still a part of my photography.

2 upvotes
Francis Carver
By Francis Carver (Feb 10, 2012)

I love using film. It says "FUJICOLOR" on the box, though.

0 upvotes
453C
By 453C (Feb 10, 2012)

I keep reading about how all is not lost, since Kodak will still be in the film business, but I have to wonder how long that business model will be sustainable.

0 upvotes
Jaberwok
By Jaberwok (Feb 10, 2012)

Well said. they are both completely different ways of image making. A lot of the idiot, latest techno wizzo 'cancelled my pre order for th OM5 N' really know fugg all about picture making and are either gearheads or rely entirely on photoshop to make a decent image. I've just re-discovered B&W and plumbing in a chemical darkroom..just for fun and the quality result.

0 upvotes
Joe M Amadas
By Joe M Amadas (Feb 9, 2012)

who in his right mind would use the Kodak name to offer a new camera?
The Kodak name stands for cheap crap since a long time now.

3 upvotes
mister_roboto
By mister_roboto (Feb 9, 2012)

They have *always* made cheap cameras. With the exception of a few like the kodak Retinas- their historical business model was making photography affordable and accessible to everyone. The Brownie was a box with film in it and cheap ass lens- but it put photography in the hands of the masses. Not everything is about the sharpest and most expensive preforming equipment.

4 upvotes
Dan_168
By Dan_168 (Feb 9, 2012)

may be for those don't want to sell whole a lot of cameras, hahaha, I was wondering what take them so long to find out it's good idea not to continue on making camera nobody wants.

1 upvote
Jaberwok
By Jaberwok (Feb 10, 2012)

The digital/film debate will go on for years!
I make good money using both digital & film. Outdoors, weddings and working for the local paper digital is ideal. Film can't touch it for quality and convenience. However high end studio work for products or limited model work with jewellery etc the old 5x4 film camera with a modern lens and modern back and controlled lighting is absolutely superb. I will admit to a digital back for it for convenience but 50 ASA 5x4 used well is a show stopper.

0 upvotes
Anepo
By Anepo (Feb 10, 2012)

I have to agree with you there.
As to use the brand name of a company which managed to bankrupt itself with the Kodak name would be a BAD business plan if nothing else.
A new name would serve a far greater purpose in marketing.

0 upvotes
WT21
By WT21 (Feb 9, 2012)

They stopped making digital cameras years ago, TBO.

2 upvotes
Total comments: 146
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