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WSJ: Eastman Kodak readying bankruptcy filing - Page 2

post #41 of 57
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Originally Posted by djmikeo View Post

[T]he line between the professional and the amatuer is getting pretty blurred. Even this article was probably not written by a "professional Journalist" in the old sense of the term.

So the industries aren't dying, just the elite class of being a professional.

You say that as if it's a good thing. Professionals bring more to the table than simply being able to use proprietary tools. Kids in a garage don't make music as good as people who've actually learned something about it first. Neither is the "common man" a great photographer because an iPhone gives him technological equality. The loss of respect for, acknowledgment of, and aspiration to expertise is perhaps the most dangerous side effect of the Information Age.

As for Kodak itself, we of the Apple faithful are seeing our future. Not soon, I suspect and hope, but inevitably.
post #42 of 57
It is actually amazing they never where taken to court for market manipulation and unfair business practices by the government. Like it or not they burnt a lot of bridges and frankly I believe accelerated the move to digital buy giving professionals incentive to look for solutions outside of Kodak.

It is a sad time for the employees at Kodak certainly. But nobody should be sad to see Kodak die. There mentality, self importance as a company is what doomed them. They honestly believed they could continue to manipulate the market to their needs instead of offering superior products. I'm actually happy to see them go.

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Originally Posted by Kolchak View Post

Bunch of youngsters around here, it seems. Proves the axiom yet again that the one thing jaded Americans like more than a rags to riches story is a riches to rags story. This is actually a sad time. It wasn't that long ago when the name Kodak was synonymous with photography. It's stunning how they could have gone so wrong. Only twenty years ago, not only were they dominant in film photography, they were cutting-edge pioneers in digital photography. The first professional digital camera back came from them, as did some of the first consumer digital cameras, although I was very leery of paying over $1000 for mere 640x480 resolution. Still, I like to remember the salad days of the company, with their Super 8 movie cameras, Instamatics and their memorable commercials, including the one that brought us Paul Anka's "Times of Your Life."
post #43 of 57
In a way though I'm happy to see them go. Yes more people will be "tapped" but they will find jobs someplace. The problem is Kodak suffered from a kind of incest that resulted in a rather disgusting management infra structure where, ideas where suppressed and only the path of the authoritarian management team was followed.

This lead to many many stupid management moves that where followed blindly. Ink jet printers are one current fiasco. Sadly what a lot of people outside of Rochester don't realize is that much of Kodak was sold off already. Many of these businesses are now very successful. Kodak effectively restructured itself around businesses that where clearly about to collapse. Not all of this is to blame on Perez as he inherited a shell.

As to RIT, this is just one example of what the wealthy do with their money. Something the people occupying Wall Street would understand if they actually educated themselves.


Quote:
Originally Posted by Switch23 View Post

Generations of my family worked at Kodak and at one time that was a huge source of pride for me. Back when Kodak was a gold-standard name that was out there as a sponsor of everything important and noteworthy - the Olympics, the Super Bowl, the official film of [fill in the blank of the important event of the day].

Not only RIT, but so much of Rochester owes its existence and identity to Kodak and the benevolence of George Eastman. There was a time when Rochester=Kodak but fortunately that time has passed. Kodak's death has been so long in coming that it has given the community time to deal with it and diversify, from an economic perspective. A radio commentator here recently likened it to "Grandma" passing away: you've seen it coming and have prepared but it's still a shock when it happens. The ship sunk under Perez but the problems started decades ago when company leadership stubbornly believed that digital was a fad and film was where the money was.

Such a waste of a proud name and the proud tradition of a company that in its prime changed the world as much as - if not more - than Apple.
post #44 of 57
It's a little soon to be writing Kodak's epitaph. They are potentially filing for Chapter 11 reorganization and haven't even done that yet. Lots of companies have emerged from Chapter 11 to live on. Kodak has a deep portfolio of intellectual property that apparently has considerable value.
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post #45 of 57
Quote:
Originally Posted by tundraboy View Post

Kodak was known for film but their cameras were crappy, cheapo stuff that were easily blown away by the Japanese.

The history of photography related companies in Rochester is actually very interesting. Some of that technology actually originated in Rochester, why it ended up in Gemany and Japan is a mystery to many.
Quote:
Here's the thing, when the Japanese choose to manufacture a product, they aim to be the best. It may be a long term goal, but they work towards it. Likewise with the Koreans and the Taiwanese. Same with the Chinese, though we laugh at the "Made in China" crap that Walmart peddles.

It isn't the "Japanese" it is rather specific companies with in that country. Likewise in the US ou have companies striving to be the best. The government can't dictate that a company will be the best or should be the best.
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Kodak was just perfectly happy to service the bottom end of the camera market with their crappy instamatics. When the digital camera revolution killed silver halide, cameras (rather than film) became king and Kodak had ZERO ability to compete in that field because they never sought to develop any expertise or excellence in it. So they tried to shift to printers --but that's also precision fine components manufacturing (rather than film which is more of a bulk chemical production process) and of course Kodak floundered.

Much of the success of such hardware these days lies in software and not in difficulty to manufacture.
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The take here is that you cannot be a world class economy if you do not, as a matter of national priority, actively nurture and promote a vibrant, cutting edge manufacturing sector.

National priority as nothing to do with it. You only eed business people with a desire to e successful manufacturing something and people willing to pay for it. What killed manufacturing in the US is that people where never willing to pay for it. The preference has been for the cheapest een if that means imported. Unfortunately people failed to realize that eing cheap puts their neighbors out of work.
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The Germans do it, the Japanese do it, we don't. Because once you fall behind, it's very, very hard and very, very expensive to catch up.

Most of the manufacturing that has goe to China is trivial. You really just need people with strong acts willing to work in dangerous occupations. Finding people to do that in the USA is currently a stretch, we have become a nation of manufacturing wimps.
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Instead, we listen to Wall Street and all these Chicago School economists who proclaim that all industries are equal and it doesn't matter if we end up a nation that mainly peddles funny paper (i.e. financial services). They also recommended against Obama rescuing GM and Chrysler, funny they're pretty quiet about that success story.

I have no love for the mindless business school graduates that drive businesses into the ground. Poor management has more to do with the failure of business in the USA than anything. Kodak is a prime example.

However calling Obamas mistake with GM and Chysler a success is a horrible mistake. It would have een far better for both of those companies to have failed. It might actually have put a little focus on what is wrong with business in the US. Further it would ave removed the entire GM management team from the food chain.
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So our brightest minds aren't out developing new technologies, designing products or running factories. They're in Wall Street trying to come up with the next ultra-complicated derivative that no one understands which they will use to again part us fools from our money. (Last year, 46, yes FORTY F*KING SIX PERCENT of Princeton grads got jobs in Wall Street!!! And they don't even have a B-school.)

You make a huge mistake here, Princeton is a school for the wealthy! It is not a school for the brightest.
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That's why, unless we change things drastically, a generation or two from now we will become to China what the UK is to us now.

Like it or not we will enter into an era of excess capacity in most industries. As such America will not be able to compete doing basic manufacturing. Our survival depends upon next generation industries.
post #46 of 57
Quote:
Originally Posted by Dr Millmoss View Post

It's a little soon to be writing Kodak's epitaph. They are potentially filing for Chapter 11 reorganization and haven't even done that yet. Lots of companies have emerged from Chapter 11 to live on. Kodak has a deep portfolio of intellectual property that apparently has considerable value.

I believe Kodak is effectively dead, they have nothing to sustain a company of its size. It could be reorganized into a much smaller company but I doubt it will be the R&D giant it once was. They simply don't have the finances nor management structure to pursue their remaining businesses.

As to patents they certainly have a few. The problem is this even if they could realize income off some of these patents they don't have a way to do anything constructive with it. A company of professional managers can not innovate, it really can't do anything of value other than to turn that money over to shareholders. That isn't a bad idea but what happens when the IP becomes invalid?

I suspect tat a wise judge would force Kodak into chapter 13. This ordeal has gone on way to long as it is. It would certainly be better for the local community, the employees and even the shareholders.
post #47 of 57
Quote:
Originally Posted by Switch23 View Post

The ship sunk under Perez but the problems started decades ago when company leadership stubbornly believed that digital was a fad and film was where the money was.

Such a waste of a proud name and the proud tradition of a company that in its prime changed the world as much as - if not more - than Apple.


Ironically enough, I spent hours at B & H yesterday with my daughter loading her up with supplies as a photography major at Maryland Institute College of Art. Her shooting is 75% film and loves spending days in the darkroom, just as I used to. Lots of people getting film, paper (not printer paper, developing paper! : ) ) and the salesguy said there's been a renaissance of sorts over the last few years of film cameras and accessories being bought by the serious hobbyist as opposed to just pro shooters. Film only seems dead because digital is so universal, but if it was dead ten years ago it's not dead now. I can't say if it's a ridiculous market or not to be in, but somebody's serving it. And, naturally, as digital went from 0 to 99.9% of all photography, was there no one whose job it was to nudge the old naysaying codgers every year to peek out their office and join the world or sell their patents now?


Interestingly, we visited RIT during college stakeouts and it had a lot that appealed. Great photography department, and the Eastman Kodak influence was impressive and alluring. But whoever let that music prof play the endless smooth jazz flugelhorn over his computer generated backing tracks while we waited beyond patiently for the speakers made a major miscalculation. 1975 Chuck Mangione may still rule in Rochester but it was a huge mood killer after the first 45 minutes for anyone from out of town, namely 99.8% of us. That was the reason we never even gave RIT a chance.
post #48 of 57
Quote:
Originally Posted by wizard69 View Post

I believe Kodak is effectively dead, they have nothing to sustain a company of its size. It could be reorganized into a much smaller company but I doubt it will be the R&D giant it once was. They simply don't have the finances nor management structure to pursue their remaining businesses.

As to patents they certainly have a few. The problem is this even if they could realize income off some of these patents they don't have a way to do anything constructive with it. A company of professional managers can not innovate, it really can't do anything of value other than to turn that money over to shareholders. That isn't a bad idea but what happens when the IP becomes invalid?

I suspect tat a wise judge would force Kodak into chapter 13. This ordeal has gone on way to long as it is. It would certainly be better for the local community, the employees and even the shareholders.

It's true they will never be the company they were once, but then they haven't been that company for a long time. After bankruptcy they would clearly be a much smaller company, but again this process of reduction has been underway for some time as well. I really don't know if you have anything meaningful left over after paring the company down to the parts that make a profit, but that's what generally happens in a bankruptcy so we'll just have to wait and see. Unless some white knight comes along, of course.

Chapter 13 would not be better for shareholders. Under any likely scenario the common stock shareholders are totally wiped out in any bankruptcy proceeding. Debt holders would get something in either case, maybe only pennies on the dollar.
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post #49 of 57
Quote:
Originally Posted by CurtB2 View Post

It wasn't even 20 years ago, more like 7-8 they were the leading developer of the digital processing units, professional grade cameras used.
Sadly, all this digital revolution has done to the concept of professional photography is kill it. Camera prices are at all time high's, they change the "Professional" standard every 2-3 years... no one can afford to keep up with it... The publishing industry has been driven into the toilet also. It's insane. Heck National Geographic is struggling... as for main stream media, there is only so far you can run buying the cheapest stock photo's available.
with the death of media, dies the artists who made the media what it was.
This is more than a company dyeing. It's an entire industry, top to bottom.
sadly, this digital revolution, which started with such promise, has evolved into the fast road to the lowest common denominator. unfortunately that denominator is nothingness.

Well said.
post #50 of 57
Quote:
Originally Posted by Dr Millmoss View Post

It is so easy to be critical of this strategy with the full benefit of hindsight, and it is especially ironic considering that Kodak's strategy of catering to the film market worked brilliantly for many decades. Keep in mind also that Kodak virtually created the amateur photography revolution 100 years ago, not by making great cameras but by make affordable, easy to use cameras, and the film to put in them. They held to this approach well into the era when the Germans in particular began to manufacture higher end expensive cameras. This is decades before the Japanese became a force in photographic equipment. Even then Kodak was the unassailed leading supplier of film and processing equipment. It was a virtually cornered market. They had no use for manufacturing high end cameras, and their failure to make them is not the reason for their present troubles.

The thing is, wasn't Kodak in the mid-70's one of the early developers of solid-state image sensors? In 1986 they made the first megapixel sensor. Didn't they also make the first consumer digital camera, the DC40? Even though they were pioneers in digital photography, they failed to see the future that THEY created and was staring them in the face? That's just tragic.

Well maybe it's not Kodak's fault then. Maybe it's just natural for companies and the people who run them to refuse to look beyond whatever it is that is making them billions of dollars a year, be it buggy whips, slide rules, typewriters or photographic film.
post #51 of 57
Quote:
Originally Posted by wizard69 View Post

It isn't the "Japanese" it is rather specific companies with in that country. Likewise in the US ou have companies striving to be the best. The government can't dictate that a company will be the best or should be the best.

Much of the success of such hardware these days lies in software and not in difficulty to manufacture.

National priority as nothing to do with it. You only eed business people with a desire to e successful manufacturing something and people willing to pay for it. What killed manufacturing in the US is that people where never willing to pay for it. The preference has been for the cheapest een if that means imported. Unfortunately people failed to realize that eing cheap puts their neighbors out of work.

I said national "priority" not national "policy". The Germans and Japanese, across the board, take pride in being manufacturing juggernauts. Government policy just follows naturally from there. So it is "all of the Japanese" not just specific companies in that country who want to be the best in manufacturing whatever it is they are manufacturing.

And I agree with you, part of the reason is the US consumer likes buying cheap, shoddily made crap. It's short-sightedness. "I'd rather buy the $2 Chinese screw driver that I replace every year instead of the $12 US-made one that I keep for life." And the government encourages this by making it so cheap to throw away junk that ends in a landfill somewhere. No one is paying nearly enough for the environmental degradation that results from the garbage they generate.

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Most of the manufacturing that has gone to China is trivial. You really just need people with strong acts willing to work in dangerous occupations. Finding people to do that in the USA is currently a stretch, we have become a nation of manufacturing wimps.

Maybe today manufacturing in China is trivial. Thirty years ago, manufacturing in Korea was 'trivial'. Sixty years ago, manufacturing in Japan was 'trivial'. Remember when 'Made in Japan', then 'Made in Korea' was a mark of shoddy products? I'll tell you one country where manufacturing is headed in the direction of becoming trivial. We're both standing on it.

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However calling Obamas mistake with GM and Chysler a success is a horrible mistake. It would have een far better for both of those companies to have failed. It might actually have put a little focus on what is wrong with business in the US. Further it would ave removed the entire GM management team from the food chain.

How do you know that? That's all supposition based on your own ideological bias. All we know is instead of the whole company going into bankruptcy and who knows what happens after that, GM (and Chrysler) has been streamlined, is building cars again, and making money. Even conservative pundits have had to concede that yes the rescue was a success, something that their bedrock beliefs told them could never, ever happen.

In truth what GM needed most to survive was to escape the debilitating burden of its excessive employee and retiree health care obligations. Something that automakers in Germany and Japan don't face because of their excellent national health care programs. I am far from a labor basher. In fact my politics is left of center, but not loony left. Those excessive health care obligations were killing GM and they just needed to go if GM was to survive and at least provide some jobs rather than zero jobs. But more importantly, the auto manufacturing know-how that GM has amassed, and which would be so costly for anyone to reacquire, doesn't get dissipated into thin air.

And by the way, GM's top management did get kicked out. And no, you don't want to remove the entire management team top-to-bottom because, believe it or not, there are some good people in there who you want to keep because they are familiar with the existing systems. See, your view of manufacturing is no different from the conservative economists theoretical ideal where manufacturing knowledge and skill is easily recovered if you happen to lose it. Most right-wing economists have no appreciation at all of the nature of the technology and know how that manufacturing requires, that's why they think "financial services? manufacturing? what's the difference? As long as they make profits and produce surpluses for the economy they're all interchangeable." Well, they aren't. The Germans, Japanese, Koreans and Chinese know this. The U.K. and the U.S. don't seem to.

There is also this other matter where you can't go through a lengthy and uncertain bankruptcy process for GM (and Chrysler) because if you do that you kill Ford as well and thus the entire US-based auto industry. Why? Because the network of suppliers and subcontractors that Ford relies on in the US cannot survive for long with just Ford as its customer. Ford was very adamant about this with Obama: You let GM & Chrysler be idle a long time, you kill the supplier industry and you kill us as well.

Of course for people who think that it's okay if the US-based auto industry just disappears, all my arguments are wrong because they are premised on saving the industry rather than "letting the market decide".

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You make a huge mistake here, Princeton is a school for the wealthy! It is not a school for the brightest.

No, you're the one who's making a huge mistake. I had just gone through the whole college app process with my kid. The ivy league really gets the brightest kids and they do hire the smartest faculty. If you're among the brightest, even if you're poor, Princeton, Harvard, MIT and the rest of them have enough money to put you through college for free. For the brightest, non-wealthy students in the land, going to an ivy league caliber private college is actually cheaper than going to a state university. So they do get the brightest students regardless of income level. This refrain that Princeton is a school for the wealthy but not the brightest may have been true during George W. Bush's generation (he went to Yale) but not anymore. People who keep repeating it are either ignorant or just indulging in some sour grapes because they didn't get accepted.

The colleges that are for the wealthy but not the brightest are mostly the second tier private colleges in the northeast. I won't needlessly inflame innocent bystanders by naming them.
post #52 of 57
Quote:
Originally Posted by jd_in_sb View Post

Kodak came out with one of the very first personal digital cameras. I owned the Kodak DC-40 in 1996. They had a window there to dominate the digital camera market. Not sure why they didn't.

They just thought film would never die!
post #53 of 57
Quote:
Originally Posted by jragosta View Post

So? Tallest's suggestion is a good one - although buying the company makes more sense.

Apple buys the company and closes all operations. Current market cap is $128 M - let's say Apple pays $200 M. If you are right about the retained losses, they can deduct them on their taxes - which would earn them about $2 B. Plus, they'd get the patents. I don't know what they're worth, but the estimate of $3 B suggests that at least some of them are useful.

apple neither wants or needs an old manufacturing plant and all the retired employee pensions it would have to suck up in order to get the patents.
post #54 of 57
Quote:
Originally Posted by Dr Millmoss View Post

It's a little soon to be writing Kodak's epitaph. They are potentially filing for Chapter 11 reorganization and haven't even done that yet. Lots of companies have emerged from Chapter 11 to live on. Kodak has a deep portfolio of intellectual property that apparently has considerable value.

Portfolio or not, sooner or later, they have to produce something people will want to buy.
post #55 of 57
Quote:
Originally Posted by CurtB2 View Post

It wasn't even 20 years ago, more like 7-8 they were the leading developer of the digital processing units, professional grade cameras used.
Sadly, all this digital revolution has done to the concept of professional photography is kill it. Camera prices are at all time high's, they change the "Professional" standard every 2-3 years... no one can afford to keep up with it... The publishing industry has been driven into the toilet also. It's insane. Heck National Geographic is struggling... as for main stream media, there is only so far you can run buying the cheapest stock photo's available.
with the death of media, dies the artists who made the media what it was.
This is more than a company dyeing. It's an entire industry, top to bottom.
sadly, this digital revolution, which started with such promise, has evolved into the fast road to the lowest common denominator. unfortunately that denominator is nothingness.

Sorry, what a bunch of hooey.

If film photography is truly an art form distinct from digital photography then it will not die out. Just like painting, sculpture, and piano music have not died out. In truth photography is an art but dark room technique is more of a skill.

And you are advancing the proposition that professional, high quality photography is dying out because the digital revolution has made low cost, decent quality cameras accessible. Well that just means that people were paying for high quality professional photography not because they truly valued the service but because back then they had no choice. I remember having no choice but to hire a wedding photographer at a breathtaking amount of money and on top of that I don't get the negatives, he owns the copyright to pictures of our wedding, and every time I want a print it was something like $200 for a 10 X 14. In short, he wants to keep milking money off me for the rest of my life. They were nice shots but $2000.00 for a days work and $200 a print? Give me a break! Today I would hire an art student, hand him my DSLR and pay him a couple of hundred to get up to 32 GB of pictures.

If professional photography is dying, it's because its practitioners priced their services far more than what they are worth to customers. Those that survive though take really great shots and are able to bring out the best in their subjects and yes, I have happily paid their prices. But no more keeping the digital files/negatives and charging me for every print I order for the rest of my life. That's the one thing that pros did that was just plain stick-in-my-craw abusive.
post #56 of 57
Quote:
Originally Posted by jd_in_sb View Post

Kodak came out with one of the very first personal digital cameras. I owned the Kodak DC-40 in 1996. They had a window there to dominate the digital camera market. Not sure why they didn't.

From an interview that I read with the former head of technology: They sold film at such a high rate that digital didn't get the attention of the top brass.
post #57 of 57
Quote:
Originally Posted by tundraboy View Post

The thing is, wasn't Kodak in the mid-70's one of the early developers of solid-state image sensors? In 1986 they made the first megapixel sensor. Didn't they also make the first consumer digital camera, the DC40? Even though they were pioneers in digital photography, they failed to see the future that THEY created and was staring them in the face? That's just tragic.

Well maybe it's not Kodak's fault then. Maybe it's just natural for companies and the people who run them to refuse to look beyond whatever it is that is making them billions of dollars a year, be it buggy whips, slide rules, typewriters or photographic film.

Read back to what I wrote. I'm not giving them a pass for missing digital photography. I was only responding to the remark about high-end film cameras.

Quote:
Originally Posted by jmc54 View Post

Portfolio or not, sooner or later, they have to produce something people will want to buy.

Some companies survive entirely by licensing their intellectual property. I'm not sure Kodak can do that but they can certainly develop a revenue stream from it. In any case Kodak makes more products than most people know about. They sell a line of medical imaging products for example. Some of these lines could be developed further once they've jettisoned their unprofitable consumer businesses.
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