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23

Kodachrome is Dead. What Can You Learn From Its Death?

Way back before digital photography, when dinosaurs roamed the surface of the planet, families packed themselves into smoky living rooms to watch trays full of color slides projected onto uneven plastered walls.  These photo viewing sessions along with some of the most outstanding print photography in history were brought to you by Kodachome, Kodak’s long-lived transparency film.  Kodachrome, created by Eastman Kodak in 1935 (specifically, by scientists Leopold Godowsky and Leopold Mannes, known as "God and Man" inside Kodak), has been around longer than any photo product in history.  Today, Kodak announced that it is “retiring” Kodachrome.

When I was young and dipping my toe into the very deep waters of photography, I primarily used black and white print film which was my stock in trade because I could process and print it myself.  When I wanted color, I used Kodachrome and it’s younger sibling, Ektachrome.  The colors in Kodachrome were great – much better than color prints at the time.  In retrospect, slides held up way better than prints as well and are much easier to scan into their digital versions.

The passing of such a product is a reminder about how things have changed and how companies need to be dynamic and change with their markets – hopefully leading them.  Kodak has made the switch to digital (they still, of course, produce plenty of film), but in the change, lost the market leadership that they once had.  While I’m sad to see such a landmark product die out, it makes me excited to think about all the potential replacement products in all markets as inevitable change happens.

Nintendo lost its utter dominance of the home electronic game market when Sony, then Microsoft beat them at their own game, using new technology.  Nintendo then reemerged from its failure with another breakthrough product, the Wii.  What’s going to happen now to wristwatch sales as virtually everyone under 25 uses their phone to get the time?  How about compact camera sales?  As cell phone cameras keep improving and software processing on phones gets better, who will want to carry both a compact camera and a phone?  You get the idea.

What about your market?  What fundamental and underlying changes are happening that you can take advantage of?  Don’t think only technological, societal changes are even bigger driving forces.  Whatever they are, get there first and you’ll have a substantial advantage.

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 June 23rd, 2009  
 Will  
 General Business, Photography  
   
 8 Comments

8 Responses to Kodachrome is Dead. What Can You Learn From Its Death?

  1. I think you’re being unfair to Kodak and Nintendo. They did something besides the development of ground-breaking technology: They did the research to show that the market was there, and paved the way to exploit it. They developed infrastructure and supplier networks that were exploited by the companies that came after them.

    Another good example is Prodigy and AOL as ISPs — Without Prodigy (and to a MUCH lesser extent, Compuserv and local BBSes), the modem manufacturers, higher-fidelity telephone lines and increased number of local exchanges, and reduction in costs to call from one exchange to another would not have happened as fast, and AOL would’ve spent all the resources that Prodigy spent beating down those barriers. Another modern parallel is Myspace and Facebook … or heck, speaking of Paralells, Paralells Desktop and VMWare Fusion. Even Apple MacOS and Microsoft Windows could be an example.

    Did AOL do better than Prodigy? In the end, yes. But Prodigy had higher start-up costs because no one had done it before on that scale. By the time AOL really got moving, Prodigy had already shown that it was possible and largely what was necessary. Nintendo had higher start-up costs because they had to develop the supplier networks and some of the basic technology, and then they had to prove it was possible to make money at it. Everyone else just followed in their footsteps and made incremental improvements before the Prodigy/Nintendo/Myspaces could recoup their startup expenditures.

    I guess it goes back to being the ‘first to market’ — you don’t necessarily want to be first to market. You want to be second to market, you want to do it better, and you want to steal as much as you can from the first guy who got to market.

  2. I think you’re being unfair to Kodak and Nintendo. They did something besides the development of ground-breaking technology: They did the research to show that the market was there, and paved the way to exploit it. They developed infrastructure and supplier networks that were exploited by the companies that came after them.

    Another good example is Prodigy and AOL as ISPs — Without Prodigy (and to a MUCH lesser extent, Compuserv and local BBSes), the modem manufacturers, higher-fidelity telephone lines and increased number of local exchanges, and reduction in costs to call from one exchange to another would not have happened as fast, and AOL would’ve spent all the resources that Prodigy spent beating down those barriers. Another modern parallel is Myspace and Facebook … or heck, speaking of Paralells, Paralells Desktop and VMWare Fusion. Even Apple MacOS and Microsoft Windows could be an example.

    Did AOL do better than Prodigy? In the end, yes. But Prodigy had higher start-up costs because no one had done it before on that scale. By the time AOL really got moving, Prodigy had already shown that it was possible and largely what was necessary. Nintendo had higher start-up costs because they had to develop the supplier networks and some of the basic technology, and then they had to prove it was possible to make money at it. Everyone else just followed in their footsteps and made incremental improvements before the Prodigy/Nintendo/Myspaces could recoup their startup expenditures.

    I guess it goes back to being the ‘first to market’ — you don’t necessarily want to be first to market. You want to be second to market, you want to do it better, and you want to steal as much as you can from the first guy who got to market.

  3. All excellent points, Karl, although in my defense I hardly think I’m being unfair to the players who lost their market leadership position. Nintendo was, in fact, riding on the coat tails of many other game vendors. They were actually second (or third or fourth) to market. They owned it and lost it because of a really poor licensing model and not keeping up with advanced graphics processing. It wasn’t costs that killed them, it was not keeping their eye on the ball. They held the high ground and with a few smart moves would have been able to hold it.

    Kodak was very late to the digital transition. granted, it’s hard to see emerging markets that are directly in competition with the one you dominate, but that’s the whole point. They spent a fortune trying to get into the Polaroid dominated instant film market, which they got sued out of, but then dragged their heels converting their users to digital. Again, they bore the startup costs, but creating a market for cameras and film does not get you permanent domination of the photographic market. Their startup costs were long ago amortized and depreciated.

    All that said, you are right. The people who lead the charge into a market first are often the ones who get the arrows in their back.

  4. All excellent points, Karl, although in my defense I hardly think I’m being unfair to the players who lost their market leadership position. Nintendo was, in fact, riding on the coat tails of many other game vendors. They were actually second (or third or fourth) to market. They owned it and lost it because of a really poor licensing model and not keeping up with advanced graphics processing. It wasn’t costs that killed them, it was not keeping their eye on the ball. They held the high ground and with a few smart moves would have been able to hold it.

    Kodak was very late to the digital transition. granted, it’s hard to see emerging markets that are directly in competition with the one you dominate, but that’s the whole point. They spent a fortune trying to get into the Polaroid dominated instant film market, which they got sued out of, but then dragged their heels converting their users to digital. Again, they bore the startup costs, but creating a market for cameras and film does not get you permanent domination of the photographic market. Their startup costs were long ago amortized and depreciated.

    All that said, you are right. The people who lead the charge into a market first are often the ones who get the arrows in their back.

  5. Two comments.
    One, after going through the process of converting family photographs and 8mm movies from my grandfather, I have to say kodachrome is just one outstanding film. 75 year old slides and movies that look like they were taken last week, no hint whatsoever of aging. Incrdibly rich colors with outstanding shadow detail and detail in the highlights. Oh, and no hardware software issues to access these images. It will take a lot more pro-active effort to keep todays digital photgraphs easily “retrieveable” 75 years from now.

    Two, I’m not sure it is fair to say kodak was late to digital. I believe they were the first to build a commercially practical digital camera for press photographers. Basically a Nikon F body camera with a few pounds of imaging, storage and processing hardware slathered in/on the body. At $30K for a 1.3 Mp camera, it was quite the bargain;-). They continue to be an important player in the imager chip business. Constant development of high technolgy products (digital cameras), vs repeat business for a stable product/service (film and developing), that’s a difficult business model makeover. The fact that they are still in the game is actually pretty impressive if you ask me.
    John

  6. Two comments.
    One, after going through the process of converting family photographs and 8mm movies from my grandfather, I have to say kodachrome is just one outstanding film. 75 year old slides and movies that look like they were taken last week, no hint whatsoever of aging. Incrdibly rich colors with outstanding shadow detail and detail in the highlights. Oh, and no hardware software issues to access these images. It will take a lot more pro-active effort to keep todays digital photgraphs easily “retrieveable” 75 years from now.

    Two, I’m not sure it is fair to say kodak was late to digital. I believe they were the first to build a commercially practical digital camera for press photographers. Basically a Nikon F body camera with a few pounds of imaging, storage and processing hardware slathered in/on the body. At $30K for a 1.3 Mp camera, it was quite the bargain;-). They continue to be an important player in the imager chip business. Constant development of high technolgy products (digital cameras), vs repeat business for a stable product/service (film and developing), that’s a difficult business model makeover. The fact that they are still in the game is actually pretty impressive if you ask me.
    John

  7. John,

    You’re right about Kodak’s moves into digital, of course. I guess I should have been more specific. Where they fell behind is in the core market they created with the Brownie – the camera for everyone. They ceded this market to others, not necessarily the technology, but the market. Even putting SLRs aside, the compact digital camera (the new Brownie) market is huge. Kodak didn’t keep up.

  8. John,

    You’re right about Kodak’s moves into digital, of course. I guess I should have been more specific. Where they fell behind is in the core market they created with the Brownie – the camera for everyone. They ceded this market to others, not necessarily the technology, but the market. Even putting SLRs aside, the compact digital camera (the new Brownie) market is huge. Kodak didn’t keep up.

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