[Leica] Konica Minolta to quit photo market - now Kodak staying in film

[don.dory at gmail.com (Don Dory)]

Seth,
Correct, two of the head positions at Kodak are outsiders.  Now, about the
four thousand upper and middle managers who report to these "outsiders".
You know, the folks who do the research, design, manufacturing, outsourcing,
etc.  Kodak is much larger than an aircraft carrier and I am not beating up
on the company to beat up on the company.  I am stating the facts as I see
them played out in the retail environment where Kodak's imaging products are
out of synch with the marketplace.  I can make no such comments about the
medical business or the other imaging business that Kodak engages in.

The public statements that I hear uttered by representatives at Kodak can be
interpreted as delusional.  For example, a recent comment was that the
margins were similar for the ribbon and paper in their kiosks were similar
to what they recieved for film.  This statement is correct as far as it
goes, but I don't believe that the kiosks are generating as many prints as
rolls lost.  Second, as the digital printers get better, more of the kiosk
business wil be done on by a digital printer instead of at the kiosk.  The
merchants who make these decisions would much prefer to print on something
whose variable cost is somewhere around 4 cents a 4X6 rather than something
whose variable cost is 20 cents.

My comments in their entirety made the comment that 1)Kodak no longer
dominates the market to the point that they can dictate film formats. 2)
Kodak no longer dominates the processing market such that they can create
new processing solutions or standards. 3) Kodak has no control over where
digital imaging will go or what standards will be set (witness their
partnership in the 4/3s system that only Olympus is currently actively
participating in) 4) Which brings me to the point that Kodak's leadership
will either really shake things up and get their ear to the ground so that
they can lead again or they will drift rather quickly into the Polaroid
model.  As a really large entity it is easy to believe that things will turn
around as you continue to lose market share, profit percentages, valuable
employees, and any real reason to be in a market.

I hope that the ship turns.

Don
don.dory@gmail.com


On 1/20/06, Seth Rosner <sethrosner@nycap.rr.com> wrote:
>
> Don Dory wrote:
>
> "Kodak is run largely by a group of executives that grew up when Kodak did
> control the market and they can not seem to break out of that mindset."
>
> Don, you could not be more wrong. Kodak today is run by Chairman and Chief
> Executive Officer Antonio Perez who came to Kodak as Chief Operating
> Officer
> almost three years ago from a 25 year career with Hewlett Packard. His
> entire background is digital.
>
> Perez' immediate predecessor as CEO was Daniel Carp who joined Kodak in
> that
> capacity in 1999. From Motorola, if memory serves me well. Robert Brust,
> Chief Financial Officer, came to Kodak six years ago from Unisys
> Corporation, a global information service & technology company and before
> that was a lifer at General Electric.
>
> Inasmuch as over seven years ago the Kodak Board had already identified
> the
> impending shift to digital and an inevitable decline in world-wide film
> sales, Carp was hired precisely to carry out the implementation of an
> enormous effort to expand Kodak's digital and other businesses (e.g.
> health
> and dental care) to a point where digital and other business sales would
> compensate for the silver halide decline.
>
> Having served as a deck offficer on U.S.S. Intrepid and stood thousands of
> hours on watch as an OOD underway, I know first hand about kinetic inertia
> and the energy required and the slow reaction time to turn an aircraft
> carrier. Turning a goliath like Kodak in a new direction without capsizing
> the ship - i.e. going bankrupt - is analagous.
>
> At my request Kodak sent representatives to the last two LHSA annual
> meetings ('04 & '05). Both made very thorough, interesting and persuasive
> presentations describing Kodak's efforts and plans in digital and film
> technology. Of course they acknowledged the decline in film sales but
> emphasized that Kodak was not leaving the film business and, in fact,
> showed
> newly developed film emulsions. They also donated five rolls of film, two
> color (slide and negative), two b+w (Tri-X and 400TCN - not sure I have
> the
> current nomenclature but yuou know which I mean) and a roll of infra-red
> film, for each LHSA member attending. That's 750 rolls of film. And please
> don't tell me they gave it away because they can't sell it!   ;-)
>
> Is Kodak going digital? Of course. They want the Company to stay in
> business. Are they quitting film. In my jaundiced opinion, not in your
> lifetime, may it be long and full of health.
>
> It may be convenient and even feel good to beat up on the old yellow box.
> But get the facts straight and stop indulging in myth. Interested Luggers
> should take a look at Kodak's website, click on corporate/investor
> center/executive biographies and see the actual backgrounds of the people
> who are running Kodak today. Including how many are responsible for film
> as
> well as digital.
>
> Respectfully,
>
> Seth
>
>
>
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