Shedding a tear for Kodak

Author(s): Asia Global Institute

Date: Feb 2, 2012

Theme(s): Trade & Investment

Publications: Opinions & Speeches

Difficult not to shed a tear for the demise of what was in its heyday truly a great innovative institution, the Eastman Kodak Company. Established in 1889, its founder George Eastman could be said to have been to photography what Henry Ford was to the automotive industry. By inventing roll film, Eastman brought photography to the masses. The Kodak camera became a great emblem of the emerging middle classes and of middle class values and leisure.Those of us above a certain age will remember our first camera, almost invariably the box in which you peered down and photographed family, friends, pets, and anything else within sight. The initial Kodak camera slogan: “you press the button, we do the rest”! Kodak was also a rare case of a brand becoming generic, such as Hoover for vacuum cleaner and the verb “to xerox” for photocopy, Kodak became a generic name for camera. When small I remember family and friends on outings asking each other “tu as pris ton Kodak?”, (did you bring your camera/Kodak?), as they delighted in repeating the French Kodak publicity clip, “clic-clac, merci Kodak!” The notorious red and yellow film box became a common household item.There are many lessons to be derived from the Kodak narrative: one of them is the perils of a parochial mindset. In the late 70s Kodak controlled over 90% of the American film and 85% of the camera markets. Fujifilm was developing in Japan and Asia, but that was “far away”. Then in the early 80’s, in a classic of the Japanese competition genre, Fujifilm entered the US market with a low cost/high quality product. The great Kodak humiliation occurred when Fuji, not Kodak, got to be the official film provider for the 1984 Los Angeles Olympics. Someone was sleeping in class!

Kodak came out fighting: even if clumsily. It sought to attack Fuji on its home turf: the Japanese market. Part of the entertainment in Japan in the second half of the 80s was watching the great Kodak-Fuji duel between their publicity balloons in the sky. The Kodak-Fuji conflict became a vivid symbol of the broader and deeper US-Japan trade tension. Fuji and Japan were accused of being unfair, of industry-government collusion, and of erecting non-tariff barriers preventing Kodak from access to the Japanese market. In 1995 the US filed a petition at the recently established World Trade Organisation accusing Japan of unfair practices. Three years later its complaint was rejected.

In the meantime, Kodak’s revenues and profits were wilting, not only because of its losing battle with Fuji, but also because of failing to get a prominent driving place seat on the digital camera locomotive. Though Kodak had been a technological pioneer in digitalisation, it was a commercial laggard. Its senior management also engaged in a frenetic search for partners (Microsoft, Apple, Motorola), while failing to focus on its business. It refused to recognise that film photography was going the way of the Dodo.

Kodak is a great narrative. Great not only in its brilliant accomplishments; but also in its tragic (as in Greek tragedy) failures. As Kodak passes from the scene, the lyrics of the first stanza from Frank Sinatra’s “My Way” seem definitely appropriate:

And now the end is near
And so I face the final curtain
My friend I’ll say it clear
I’ll state my case of which I’m certain
I’ve lived a life that’s full
I travelled each and every highway
And more, much more than this
I did it my way!

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