With Eastman Kodak on the brink of a restructuring, many people are wondering what the future holds for them. It is likely that they will get some cash for some of the patents that they hold and many of those patents will allow for advancement in technology that Kodak has been holding back from the market. This will allow Kodak to survive for the short term, but the future as it stands is pretty bleak for them. Their current situation is completely their own fault as they hung onto the past for far too long.

Eastman Kodak’s core product have been film, chemistry, print paper and printing plates. Their key markets are printing, photography and medical imaging. All of those markets are now eliminating the use of film with medical imaging the last to transition. Most of their sales have disappeared with the remaining sales making it difficult to operate efficiently. Kodak had a share price around $80 but is now below 50 cents. Pretty scary times for a huge company on the brink of collapse.
As a Kodak customer, I always kept close tabs on their operation. I worked with cameras , developing film, litho stripping and platemaking (all part of the printing process). Our invoices from Kodak were enormous, but of course, that was always passed on to the customer. The development of emerging technology was something that I always followed and there were some exciting developments that were under way and then dis-appeared. Sometimes the developer would run out of money or support, sometimes they would be bought by bigger companies, some were shelved and many actually developed into products. What I noticed with Kodak’s involvement with these technologies was that they made an effort to hold back advancement and tried to keep the film business alive for as long as possible. One of the products that I was watching develop was a product that was sprayed onto a press cylinder and then imaged directly on the press. No more plates. Kodak bought the technology and it disappeared.

Cash is King

Kodak has an obligation to it’s shareholders to consistently grow and do everything in it’s power to protect it’s business. They had a choice between leading by developing new products and markets or to hold and protect their existing business. With the emergence of direct imaging, Kodak was starting to lose sales with every improvement made in the industry. As a leader in the change to computer to plate, it seemed like they were working towards sabotaging it’s development. I found that Kodak reps spent a great deal of time developing relationships with printers and they all seemed to carry a programmed message that they delivered to the printing trade. This is one of the reasons that the printing industry took so long to transition, because many printers did not believe it was going to work or that they were capable. Kodak helped to nurture the fear of change and keep the customer focused on using as much of their product as possible. The attitude was that computer to plate was complicated and too hard to accomplish. They talked about the difficulties instead of successes and they had an attitude that anything outside the scope of normal was impossible. I was often told by Kodak that the issues I had with their products were exclusive to me and that I should tone down my expectations. They wanted me to drop high resolution printing and stick with the standard 150 line-screen. Since I was in contact with many others who were like me, I found that many others were told that they were also the only one having problems as well. In order to effectively hold everything back, the whole sales organization had to believe it to be true and so the whole culture within Kodak would have to be trained & would continue to hold onto that belief. Kodak has been so focused on stopping change that the attitude required to turn things around is simply not there. They shut off their ability to change in order to keep everything the same and it (the ability to change) is a difficult one to get back.

Kodak needs someone with vision to review all of their patents and technologies and create something new. They have the tools but don’t seem to know how to use them in today’s world. Their business model does not fit in today’s society and it will only get worse with progress. Kodak needs to start considering the health of the consumer and find something that can help them. The consumer does not need Kodak and has no loyalty to them. Why should they? It’s time to start putting the consumer first and solving their problems. Forget about everything you know and create a new way instead of trying to catch up. Lose the box that contains what you know and what you can see and present something new that everyone will want.

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