Kodak announces plans to sell consumer film division

[Ben Syverson]

I haven't seen this on the forum yet: Kodak Takes Next Steps toward Successful Emergence (http://www.kodak.com/ek/US/en/Kodak_Takes_Next_Steps_toward_Successful_Emergence.htm)

They're selling their "Personalized Imaging" business, which seems to include all still film.

It mentions that they're going to hang on to their Commercial Film business, which I assume means the high-volume 35mm motion picture business. Oddly it seems that their lucrative photo paper business is part of what they're spinning off.

[BrianShaw]

Well, thats an interesting assumption and I'm confused. I thought "Professional film" prducts was transferred to the Commercial Film Division last year or so. But on another forum a Kodak PR person says all non-motion-picture film is in this Personalized Imaging are that is being sold. Confusing.

[paulr]

The press release looks deliberately confusing. A blog post someone else linked included some analysis, which placed all of the film and paper products under the umbrella of Personalized Imaging ... but i can't vouch for that analysis. Seems strange that Kodak is trying to announce this without really announcing it.

If they are indeed selling the whole shebang ... who might buy?

[BrianShaw]

... so as I often say, "Only time will tell."

[Ben Syverson]

The wording is definitely vague, but I have a hard time believing that they'll keep making Portra while selling off Kodak Gold. They come from the same machines, so it would be hard to sell one without the other.

[Brian C. Miller]

There's a thread in the Lounge.
I wonder if the still film business is all that profitable. I'm sure there isn't a lot of profit in making LF film. 35mm color is what's propping up the consumer sales, and I'll bet that 35mm Tri-X is 2nd place.

I'm guessing that what they are selling is the "business," and not the actual Building 38 equipment. Everything is coated there, and it's not a trivial task or investment to move the coating to be done elsewhere. Kodak has a deal with the movie industry to produce film until 2015. If the movie industry's demand isn't strong enough after that, then I don't think there will be a real Kodak product. We'll see various brands, but it will be like what's happened to Polaroid.

From reading about Kodak management, it seems that they've been selling off everything that's profitable for a long time. Eastman Chemicals in TN is highly profitable, but Kodak doesn't own it anymore. Kodak has sold off a lot of very profitable digital technology. At this stage of the game, the management has basically killed Kodak, and they're just parting it out for a while.

I'm going to hoard what I can, and enjoy it while it lasts.

[Brian Ellis]

From my earlier post on the same subject.

http://theonlinephotographer.typepad.com/the_online_photographer/blog_index.html

Since there's now three threads on the same subject counting the one in the Lounge, perhaps the moderators could consolidate them.

[BrianShaw]

The wording is definitely vague, but I have a hard time believing that they'll keep making Portra while selling off Kodak Gold. They come from the same machines, so it would be hard to sell one without the other.

That would be nuts, huh. Maybe I missed a subsequent Kodak reorganization announcement!

[Robert Hall]

...

If they are indeed selling the whole shebang ... who might buy?

Ilford? ;)

[Sal Santamaura]

...If they are indeed selling the whole shebang ... who might buy?


Ilford? ;)HARMAN's owners have shown by making a success of Ilford since taking it over that they're far too smart to even think about buying the ghost of Kodak. :D

[Drew Wiley]

Plenty of chatter over on APUG. Apparently things like XRay film would be classified as commercial, but not still film in our sense of usage. In an ideal scenario, nothing would
outwardly change. Someone else would own the infrastructure and be responsible for the
finances, but the gold boxes would still look the same. Just like when Champion bought out
Kodak chemicals. I certainly hope so, since in color film at least, Kodak has reached the
pinnacle of quality; and digital hasn't realistically arrived at the point of being a practical or
qualitative replacement for typical large format film applications. But maybe this is just
another of their fishing expeditions using a profitable division as the lure. Might be a bargain for someone, hopefully someone who belives in film for its own sake and is willing
to sustain the quality, and who doesn't have to raise pricing even further to the roof in
order to pay back the investment.

[Ben Syverson]

Maybe some Saudi royal will buy it as a vanity business

[John Kasaian]

Maybe some Saudi royal will buy it as a vanity business

It'll likely be cheaper than thoroughbreds, lol!

[Drew Wiley]

I don't know if I trust those racehorse-breeders, John. I know one (a local billionaire) who
built a six million dollar barn, spent several million more on the horses (22 of them), then
told the poor stiff who had to clean and repair the stalls that he couldn't afford to pay him! Typical. Guess if he goes to bed at night and finds a horse head in it, ala Godfather-style, he might recant. But usually, he does pay at least partially a few months later.
If he bought Kodak, you'd probably open a film box to find it empty, along with a little note
demanding your request be rephrased by a certified accountant.

[CKrenzer]

All - my name is Colleen Krenzer and I work with Kodak's Film PR team (I'm on the agency side). I'm hoping that at a minimum I can help answer any questions that you have about the announcement (and I apologize for not commenting sooner).

Regarding the businesses included in the sale: All the still films, both consumer and professional, fall under the Personalize Imaging business and are part of the proposed sale. Commercial films include the films used in aerial, industrial and printed circuit boards and are not part of the sale, nor is the motion picture business.

I'll say what I've said on another forum. The key points:

1. Kodak will continue to manufacture all its products during this time.
2. As Kodak moves forward with the potential transition of these businesses to new ownership, the intention of the company is to find a buyer who will continue to make the same products and services currently produced.
3. As it has done with previous businesses that it has sold (e.g. Carestream) Kodak will ensure that the potential buyers shares its commitment to serving customers.

I'll try to answer other questions that you have, if I can.

[Ben Syverson]

Thanks, Colleen!

[BrianShaw]

Hi Colleen -- welcome to the forum. As you might imagine, many of us participate on the various forums but it is good that so are you!

[Pawlowski6132]

I wonder how much one could get the retail film division for.

Hmmm.

[Roger Cole]

I wonder how much one could get the retail film division for.

Hmmm.

Stealing an idea from APUG - let's start a Kickstarter project to buy it! ;)

Silly of course, but this is somewhat hopeful news I think, at the very least. If they keep making TMY-2, Tri-X, Portra 400 and Ektar I will be happy. If they brought back E6 I'd be very happy. Add Plus-X and Kodachrome and the process support for the latter and I'd be ecstatic.

My odds of being happy are much better than of being very happy and I have more chance of winning the lottery (if I ever buy another damned ticket) than of being ecstatic in that scenario.

[John Kasaian]

All - my name is Colleen Krenzer and I work with Kodak's Film PR team (I'm on the agency side). I'm hoping that at a minimum I can help answer any questions that you have about the announcement (and I apologize for not commenting sooner).

Regarding the businesses included in the sale: All the still films, both consumer and professional, fall under the Personalize Imaging business and are part of the proposed sale. Commercial films include the films used in aerial, industrial and printed circuit boards and are not part of the sale, nor is the motion picture business.

I'll say what I've said on another forum. The key points:

1. Kodak will continue to manufacture all its products during this time.
2. As Kodak moves forward with the potential transition of these businesses to new ownership, the intention of the company is to find a buyer who will continue to make the same products and services currently produced.
3. As it has done with previous businesses that it has sold (e.g. Carestream) Kodak will ensure that the potential buyers shares its commitment to serving customers.

I'll try to answer other questions that you have, if I can.
Hello Colleen.
What division will the x-ray film production be in?

[Michael Kadillak]

Hello Colleen.
What division will the x-ray film production be in?

The X ray film division was sold years ago by Kodak to Carestream Health and it is my understanding that they coat their own film here in Colorado.

When one considers the effects of taking a business unit off of one balance sheet and onto another that is relative clean and manageable, the possibilities are much more positive. Because of the risky nature of the equity markets there is significant capital chasing opportunity in the private equity sector. We should know fairly shortly what the real revenue numbers look like relative to controllable costs. If Kodak cannot announce a buyer within 3-6 months, the odds are not in their favor that they will remain a viable integrated company. George Eastman is rolling over in his grave.

[Kevin Crisp]

Do suicides roll over in their graves?

[Michael Kadillak]

Do suicides roll over in their graves?

Sure. If you are dead, what difference does it mean how you got there?

[Kirk Fry]

Besides his work was done.

[Frank Petronio]

I think George had a rotisserie installed in the casket.

I didn't realize that making movie film and still film were independent of each other, I thought they used the same manufacturing equipment at some point. In any case, why not keep all the film manufacturing together for efficiency's sake? Or is the still film made on such a small scale that it could actually be efficient as a stand alone company?

[Michael Kadillak]

I think George had a rotisserie installed in the casket.

I didn't realize that making movie film and still film were independent of each other, I thought they used the same manufacturing equipment at some point. In any case, why not keep all the film manufacturing together for efficiency's sake? Or is the still film made on such a small scale that it could actually be efficient as a stand alone company?

Movie film sales support still film as it is a much smaller market. This comes down to projections of forward markets under the assumption that at some point the downtrend will stabilize and will turn positive. I hear from the grapevine that this has already happened. Paper is the product in trouble....

[Sal Santamaura]

...I didn't realize that making movie film and still film were independent of each other, I thought they used the same manufacturing equipment at some point...They still do.

[algarzai]

Maybe some Saudi royal will buy it as a vanity business

hmmm sounds like fun. maybe i will move the factory to Riyadh too.

[al olson]

Hmmm

It was my understanding that Ektar was developed specifically for the movie industry. The advantages being:
1) It has a much greater exposure range than the transparency films,
2) It is easier to make movie prints from negative film than transparency film,
3) It was designed for making better digital scans,
4) It has superior flesh tones,
etc.

Now for the 35mm shooters, shouldn't it be possible to buy movie film in bulk and cut it down?

If this were true, than why would Kodak not sell off larger rolls for some enterprising business to cut down to sheet sizes? Why only to the movie industry?

It seems likely that Kodak would not be selling off its coating equipment, but selling the rights, the formulas, the processes, and the technology to some (?) willing buyer. Maybe ... :D ... when the smoke clears some competitor will buy the rights for HSI and HIE, and maybe even for EIR.

[Ben Syverson]

Ektar for the movie industry? No, I don't think so. They wouldn't need to convince filmmakers to shoot on negative stock, as it's virtually unheard of to shoot on reversal. And filmmakers tend to prefer faster stocks. 500T is probably their biggest seller.

You can certainly shoot movie film in still cameras. I believe the B&W stocks don't have a rem-jet backing, so they should be easy to process. The color stocks do have the rem-jet, which you would have to scrub off before processing. I understand it's pretty messy.

[Drew Wiley]

Ektar would seem to be a bit too high a contrast for motion film work. It's a wonderful film for stills, however, with maybe about a stop latitude either direction more than typical chrome films - not much more, realistically reproduction-wise. I sure hope it stays in production for awhile.

[Ben Syverson]

I agree... Ektar is seriously incredible stuff. I couldn't resist picking up a few extra boxes when Kodak made this announcement.

[cj8281]

Its funny that Colleen Krenzer has not responded to any of the questions asked of her or posted since her first post.

[Kirk Gittings]

Token PR effort.......

[rdenney]

Token PR effort.......

Plus, it's not in her best interests at all to get into arguments with the nameless masses on the Internet.

I found the article interesting in what it did not say. It did not say they weren't selling the consumer film division. It only said they would continue to make the film. That seems rather obvious after our discussion of what it would take to move the machines they use to make it.

Rick "who also does not participate in the banter of forums within his professional responsibilities, simply because there is too much at stake given current roles" Denney

[Drew Wiley]

Making film and the distribution and marketing of it are hypothetically two different things,
and could be separated functions for either better or worse. But there's no assurance this
will even happen. Selling a division only works if you have a buyer.

[Bob Salomon]

Selling a division only works if you have a buyer.

Who is willing to pay a price agreeable to both. Otherwise anyone could just buy it.

[CKrenzer]

Hello - sorry for the delayed response.

Regarding EKTAR - when the company brought the newest version of this to the market (2008), part of the enhancements came from KODAK VISION Film technology, used in the motion picture films. So yes, there are shared technologies used across the film lines.

Regarding last week's information. Kim Snyder is the head of Kodak's Entertainment Imaging Division and in an article (attached here: http://motion.kodak.com/motion/About/The_Storyboard/4294970036/index.htm), said the following "Kodak will continue to manufacture and distribute its quality line of motion picture film products. As a matter of fact, all film manufacturing will actually stay with Kodak, including that of consumer and professional still film."

So what does this mean? Our film manufacturing for all our business lines happens in the same factory. Therefore, we expect that whomever purchases the BUSINESS that sells our still consumer and professional films will create a supply agreement with Kodak. As we've also stated, we will be open to negotiating a licensing agreement.

Again, I hope this clarifies some of the questions you have. Sorry for the delay in responding.

[BrianShaw]

Thanks Colleen!

[bob carnie]

Sorry to ask
but who is Colleen and what position does she hold at Kodak?
This if the first time someone from Kodak other than ex employees has posted here from what I am aware.
This is great if she is in a position to pass current info rather than the rumours going around.

Thanks Colleen!

[Sal Santamaura]

...who is Colleen and what position does she hold at Kodak?...See post #15 in this thread.

[CKrenzer]

Sorry to ask
but who is Colleen and what position does she hold at Kodak?
This if the first time someone from Kodak other than ex employees has posted here from what I am aware.
This is great if she is in a position to pass current info rather than the rumours going around.

Hi Bob - I work with Kodak's PR agency for the film, paper and output systems groups. With the stories going around and some of the confusion, I wanted to try and help answer some of the questions. I'll be very upfront about the information to which I am or am not privy and the type of questions I can or can't answer.

[bob carnie]

Hi Colleen

Welcome to the forum, I should have read the whole thread but lately there is so much misinformation about Kodak that some of the threads
are not worth reading.

Bob

Hi Bob - I work with Kodak's PR agency for the film, paper and output systems groups. With the stories going around and some of the confusion, I wanted to try and help answer some of the questions. I'll be very upfront about the information to which I am or am not privy and the type of questions I can or can't answer.

[RichardSperry]

Regarding last week's information ...
Again, I hope this clarifies some of the questions you have. Sorry for the delay in responding.

Thank you.
Pretty much what I thought it meant.

I still think that Fotokemica would make the most benefit out of buying the business. I hope you don't sell it to some 'bowling ball' company that has no idea how to run a film manufacturing and marketing company. I've just recently started using Kodak films, and I really like the Tri-X, it would be nice if the division doesn't do the Hummer thing.

My first thought looking at your proposed terms, if I were a potential buyer, is that Kodak wants all the good and easy, and I would have all the heavy lifting to do. I would put in terms to even the deal out. My main objection is, I would have to compete against Kodak selling the film I make.

I would want some serious long term quantity commitments(with bonds and tangible assets to back it up) with that license agreement. Yes, it would be nice to have a ready made customer buying my stuff, but as of yet that customer has not proved it's credit worthiness(the patent sales is going miserably), and even it's short term viability is still in question. And because Kodak will be both my competitor as well as customer, my pricing to Kodak would leave a very very slim margin for them(because price fixing is illegal).

Additionally, I would not make the payment for the company all at one go in the beginning. I would make it a structured payment deal(5 year minimum), most likely structuring the licensing agreement sales, into the payout to Kodak. If Kodak stops buying film from me, my payout to Kodak stops as well.

I do wish you luck with the whole deal.

[Bob Salomon]

"I would not make the payment for the company all at one go in the beginning. I would make it a structured payment deal(5 year minimum), most likely structuring the licensing agreement sales, into the payout to Kodak. *"

But that is the decision of the Federal Bankruptcy judge and the Debtor's Committee and the debtors.

[RichardSperry]

Kodak can go completely tits up either during this bankruptcy proceeding. Or any time immediately following it.

The biggest value they hoped for was the patent sales. Which even the highest bidders are bidding a very small fraction of the original estimated value. The value which allowed Kodak to be restructured in the first place. And which has lead to Kodak putting the film business on the auction block now, which was off the block in February.

This is just basic Swim With The Sharks stuff. If you are looking at buying a business, you better really watch out if that business has only one big customer. Which essentially this business is. If the purchase must be all and outright, then the value of that business is drastically reduced, especially when 'their' largest customer is currently in bankruptcy proceedings. Considering I can just wait it out, watch Kodak go really tits up, then just buy all the equipment later for weight of steel cost(like IP did).

Oh, one last thing. If I were ever to buy such a company. First thing I would do is hire you, Bob, as my company/product marketing rep. With enough to spare to get yourself a few new employees(Colleen's polishing her CV right now) too.

[Bob Salomon]

Richard,

I'll keep my fingers crossed.

[Drew Wiley]

Well Richard, I don't know why you'd expect Fotochem. to buy them when they can't even
afford to repair their own equip. But the Kodak bankruptcy is old news by now. Just mopping up now and hopefully finding a trajectory which works. You know, some of us use color film and Kodak is still very important to us. Wishing them ill is kinda like shooting yourself in the foot. There are no doubt still some good people there who are obviously still making some superb products. Why should what they do right go down the drain because of what mgt has done wrong? And it's not their manufacturing of film which is for sale, but the marketing of it. There are other complications, however, like the fact that
EK has their own coal power plant, which some folks in town want shut down for air quality
reasons. How much infrastructure and supply chain can go down before the whole thing
collapses once for all, and the whole community itself goes into a tailspin.

[RichardSperry]

Because Fotokemika has been making film on 60 year old equipment made by The Commies. Survived the fall of the Iron Curtain. Survived through civil war, and continued to run a viable film and paper company without any spare parts or manufacturing equipment for new repairs for over 20 years. And run it at a profit.

I would say, of any other company in the world, they have the degrees and credentials to run what is left of Kodak's equipment and produce the films(and paper again). Name any other company which exists that would be in the position to or will to. Ilford's not going to be interested, they are doing just fine right now and hope it fails completely. Same with Fuji. Kodak is Boardwalk at the end of the game, one green house on Boardwalk, house on Park Place has just been sold to pay rent and it's not enough. Who wants to buy it now, one more bad roll, and they are out of the game(and all the other properties except Mediteranean and Baltic have hotels).

So just about any other suitor is going to be like AMC buying Jeep or Harley Davidson, and we all know how that turned out don't we?

Maybe one of the German companies ?Agfa/Maco? would be interested, I dunno.

[RichardSperry]

And it's not their manufacturing of film which is for sale, but the marketing

I read BUSINESS as, it all. Roof. Buildings. parking lots. People labor. land. equipment. and marketing. It needs to be self contained as a business.

Ilford may be interested in color. But why would they be interested in all of Kodak's black and white stuff? They already have that. And they are profitable now doing what they do, and they are already streamlined, after coming out of BK restructuring themselves a few years ago.

If I were working at Kodak now, I would order Rosetta Stone for Croatian today and start learning it fast.

[Sevo]

Because Fotokemika has been making film on 60 year old equipment made by The Commies. Survived the fall of the Iron Curtain. Survived through civil war, and continued to run a viable film and paper company without any spare parts or manufacturing equipment for new repairs for over 20 years. And run it at a profit.

Well, Fotokemika had been making film on 45 year old equipment made in West Germany, originally for the West German subsidiary (Adox) of a major US corporation (Dupont), and bought in some more West German equipment over the years. Yugoslavia, by the way, had been on the same (third, neutral) side of the Iron Curtain as India and Sweden. And one of the reasons Fotokemika quit was that they were about to become unprofitable. Arguably due to a strictly local and very different transition issue than the shrinking colour film producers - the low wages paid so far in Croatia are increasingly unsustainable, as the price of just about everything in Croatia is on the rise in apprehension of the EU membership next year...


I would say, of any other company in the world, they have the degrees and credentials to run what is left of Kodak's equipment and produce the films(and paper again). Name any other company which exists that would be in the position to or will to.

Be serious. Fotokemika has been running a plant smaller than Kodak's test labs, and would neither be able to cope with managing a US production site, nor be able to convince the necessary number of Kodak employees to relocate to a Zagreb suburb...

[RichardSperry]

Sevo,

Details aside. Would you agree that they were able to produce relatively good film and paper under pretty horrible political and economic conditions? Horrible technical conditions?

These people were holding the machines together with bailing wire and lubricating machines with bacon grease, I bet. Because it was all they had left. Sounds exactly like the people who could wring profit out of Kodak's machinery, and keep it going until the last LF'r dies.

I suppose Mark Suckerberg could buy it all up with a weeks pay, but what's he gonna do with it all, put a LIKE button on it?

[Sevo]

Details aside. Would you agree that they were able to produce relatively good film and paper under pretty horrible political and economic conditions? Horrible technical conditions?


Nothing as dramatic as that - Detroit corporations might be better candidates if you are looking for that level of decay. The cultural (and economic) divergence within Europe is no bigger than that within the US, and Croatia is a far cry from being the poorest part of Europe...

[RichardSperry]

Really?

The news over here in the late 80's-90's showed a different story.

My middle school German teacher often told stories of how he and his grandfather escaped Yugoslavia right after Tito took over. Kinda like Detroit in the 70's, I suppose. He did predict that when Tito died there was going to be a blood bath. Funny that my Yugoslavian Serbian German language teacher was able to predict that, and all the major world leaders could not.

Anyways, there appeared to be so many 'sides' back then and all of them had their own propaganda, hard really to know who was telling the truth or not. Maybe it was all lies. Maybe all the congressional testimony were lies and all the photos and films were staged and faked. Dunno.

Ok, Fotokemika is out. Maybe Impossible Project can get a Kickstarter fund together and buy it up then.

[Oren Grad]

I read BUSINESS as, it all. Roof. Buildings. parking lots. People labor. land. equipment. and marketing. It needs to be self contained as a business.

Kodak has already made clear that they intend to keep the manufacturing:

Kodak will continue to manufacture and distribute its quality line of motion picture film products. As a matter of fact, all film manufacturing will actually stay with Kodak, including that of consumer and professional still film. We will continue providing our entertainment customers with the products and support they have come to depend upon from Kodak.

In addition to manufacturing film, we are pursuing potential vertical markets that will utilize our film technologies for a variety of alternative and exciting products. This includes Functional Printing applications as well as Thin Film and Specialty Chemicals growth opportunities.

http://motion.kodak.com/motion/About/The_Storyboard/4294970036/index.htm#ixzz266mE6Gfs

And:

This to clarify some confusion regarding our still consumer and professional films. Our film manufacturing for all our business lines happens in the same factory. Therefore, we expect that whomever purchases the BUSINESS that sells our still consumer and professional films will create a supply agreement with Kodak. As we've also stated, we will be open to negotiating a licensing agreement.

What does this mean – this means the quality of the film you use today, whether it be PORTRA, EKTAR or any of our B&W films, will not change. We've always worked to ensure that we bring the best films to market.

https://www.facebook.com/kodakprofessional/posts/485593104792368

[RichardSperry]

So you're saying that that means that Kodak will continue to make all the film, for the buyer, which will market and sell the film. Then license back purchasing of the film they just made, back to themselves from the buyer, so that they can wholesale it to retailers in direct competition with the buyer company.

Is that what that means?

That makes no sense to me.

[Michael Kadillak]

Good gawd the participants on this post have expended considerable efforts on completely speculative dialog that at the end of the day does not amount to a bail of hay.

Unless you are within the inner circle of executive management at Kodak and are privy to the latest strategy meetings on this subject you don't know squat. Yes, we are ALL deeply interested and concerned about the future of sheet film and I understand that concept well. At the end of the day this forward decision is subject to so many different variables that attempting to "understand" this business condition and what will come of it with our limited skill set is simply foolish.

What I do know is that the best thing we can all do is to purchase as much of the film that is best at assisting you as a photographer express yourself and leave it at that. That is where the buck stops for us as consumers. If Kodak produces the film that is your favorite then buy the crap out of it and have a good nights sleep. Worrying about the probable outcomes is just foolish because the decisions are completely beyond our control. The only sensible activity for a consumer is to make a decision to consume or to pass on the opportunity. If you opt to sit on the sidelines and then start lamenting your inability to expose a certain emulsion when it has been pulled from the market sorry, but I can't feel your pain because you had every opportunity to solve your own self imposed problem.

[BrianShaw]

Good Gawd is right!

[Roger Cole]

So you're saying that that means that Kodak will continue to make all the film, for the buyer, which will market and sell the film. Then license back purchasing of the film they just made, back to themselves from the buyer, so that they can wholesale it to retailers in direct competition with the buyer company.

Is that what that means?

That makes no sense to me.

Are you reading the same thing we are reading?

No. It cleat means that current EK would continue to manufacture film which they would wholesale to another firm for packaging and distribution. Where you get these extra steps of buying it back again and then reselling is beyond me.

What Kodak says they are trying to do is clear enough. Whether they can find a buyer and make it work is not clear at all.

[BrianShaw]

I think some people missed the part about the "supply agreement", Roger.

[Frank Petronio]

Thanks Kodak, for the clarification. Good Luck!

Right Now "we" could buy Kodak for only $64-million. Consider that annual film sales are about 20m (http://theonlinephotographer.typepad.com/the_online_photographer/2011/05/film-falls-off-a-cliff.html) and firesale the rest ;-p just like Bain Capital would do!

[RichardSperry]

Are you reading the same thing we are reading?

No. It cleat means that current EK would continue to manufacture film which they would wholesale to another firm for packaging and distribution. Where you get these extra steps of buying it back again and then reselling is beyond me.

What Kodak says they are trying to do is clear enough. Whether they can find a buyer and make it work is not clear at all.



Therefore, we expect that whomever purchases the BUSINESS that sells our still consumer and professional films will create a supply agreement with Kodak. As we've also stated, we will be open to negotiating a licensing agreement.

Maybe I'm misunderstanding what this says. If you buy the film business you own the film business, you are supplying the film. If you buy the business, you can license the film to whomever. If the buyer is the just going to private label Kodak's film, they don't need to be a buyer of the business. You just buy the film from Kodak and put your label on it.

Kodak licensing film sales to a private labeling company means that company is not buying the Kodak business. Means that Kodak is keeping the business, not selling like they say they are trying to do.

Please correct me where I'm wrong.

[Frank Petronio]

Per MK, it is all unknown and in flux, so it's hardly worth speculating. But since this is an idle Internet forum and it hardly matters, I speculate that Kodak wants to continue to manufacture movie film for several more years. They probably want to sell the marketing and distribution of their still photo film so they can downsize that part of their business - the last of their business to consumer business I think. Once they sell off the entity that gets still film into consumers' hands, they will strictly be a business to business company. It probably makes sense in terms of streamlining and neatening up the structure of the company - something they've always been monkeying around with forever. Maybe it helps them look better to the courts? Who knows?

[BrianShaw]

That's funny how its not worth speculating but then that is exactly what you do. You keep me chuckling. Thanks!

[Roger Cole]

I think some people missed the part about the "supply agreement", Roger.

Looks like I hit an autocorrect problem when I meant to say it "clearly means" and it got changed to "cleat." I love Tapatalk but sometimes the iPhone...

Anyway...


.

Maybe I'm misunderstanding what this says. If you buy the film business you own the film business, you are supplying the film. If you buy the business, you can license the film to whomever. If the buyer is the just going to private label Kodak's film, they don't need to be a buyer of the business. You just buy the film from Kodak and put your label on it.

Kodak licensing film sales to a private labeling company means that company is not buying the Kodak business. Means that Kodak is keeping the business, not selling like they say they are trying to do.

Please correct me where I'm wrong.

You are making this far more complicated than it is and parsing the words too much with "what buying the business means" and so on. It's clear - Kodak wants to keep making the film. The movie film they'd continue to sell themselves. The consumer and pro still films they'd wholesale to someone who bought the marketing and distribution piece of the operation, who would then handle those aspects.

As someone on APUG commented it looks like they want to keep the profitable and (relatively) easy/within their expertise and sell off the messy part. To be more charitable, they want to keep the part they do well and sell off the part they've been screwing up badly for some time now.

[Frank Petronio]

That's funny how its not worth speculating but then that is exactly what you do. You keep me chuckling. Thanks!

And I appreciate you watching and reading my every word, it's heartwarming and kind of cute. As long as you are 3000 miles away that is ;-p

[adam satushek]

Thanks to everyone trying to provide clarity to this situation. I think I'm starting to understand what may be going on...Franks assessment seems reasonable to me....but that is beside the point. My only real concern is the continued availability of amazing films like Portra 160 in 120 through 8x10 formats. I really don't care how it happens.....just really hope it does. I really am not sure what how I would compensate for the loss of Portra.....of course there is Fuji....but who knows how long they will still produce color material, and their greens suck in my experience.

l'm just complaining again, but I sincerely hope that whatever is going on here results in Kodak's amazing films being available for years to come.

[Brian C. Miller]

My only real concern is the continued availability of amazing films like Portra 160 in 120 through 8x10 formats.

It all comes down to the consumer. The consumers must consume, so there is profit for the producers to produce. That's the only thing that will keep film alive.

Every time you use a digital camera, a roll of Kodachrome cries.

[rdenney]

Please correct me where I'm wrong.

A licensing agreement means the buyer gets to sell Kodak film, not privately labeled film made by Kodak. The yellow box is presumably a powerful marketing asset.

Rick "thinking the due diligence process for that sale would be hairy" Denney

[BrianShaw]

And I appreciate you watching and reading my every word, it's heartwarming and kind of cute. As long as you are 3000 miles away that is ;-p

I do that because it is quite obvious that you know how to have fun. I'm a bit of a conservative bore so I live life through your exploits. I actually would like to meet you someday so you can terach me how to loosen up. I have family near Rochester so some day...

[RichardSperry]

A licensing agreement means the buyer gets to sell Kodak film, not privately labeled film made by Kodak. The yellow box is presumably a powerful marketing asset.

Rick "thinking the due diligence process for that sale would be hairy" Denney

Who's gonna do that? That's stupid. They are getting pennies on the dollar bids for their BILLIONS of dollars worth of patents.

It certainly does not gel with Kodak announcing "they are selling the still film division" thing.

If what you are saying is true, they are essentially hiring a new marketing firm; but trying get some gullible fools into paying them instead of getting paid to sell it. That whole things is backwards, and would be considered a scam network marketing scheme in any other sense. Sounds like an Amway pyramid deal, if what you say is true.

Who's going to trust them to even be in business to make the film in the first place?

We all know, even if we don't want to admit it, that film is anachronistic. We like it probably because it is. Everyone knows it's a buggywhip, even though we like using this buggywhip. I just don't see salesmen tripping over themselves to pay Kodak for the rights to sell Kodak product for them. That's plain stupid.

[rdenney]

Who's gonna do that? That's stupid.

It happens all the time. Most products are sold by distribution companies that are owned separately from the manufacturer, and still depend for their existence on that manufacturer. Many trade under the same brand name as the manufacturer.

You seem quite eager to pass instant judgment on business practices that are common, based on the purest of speculation. Maybe we should just let things unfold.

Rick "who has been through this process a few times" Denney

[RichardSperry]

I'm eager for a viable company to make Kodak film for the next 20 years.

That's all.

I don't see that happening. And it's a shame.

[Brian Ellis]

It happens all the time. Most products are sold by distribution companies that are owned separately from the manufacturer, and still depend for their existence on that manufacturer. Many trade under the same brand name as the manufacturer.

You seem quite eager to pass instant judgment on business practices that are common, based on the purest of speculation. Maybe we should just let things unfold.

Rick "who has been through this process a few times" Denney

Right, but delete the word "maybe."

[Drew Wiley]

Just doesn't make a lot of sense to me. Kodak wants to lower their overhead by divesting
themselves of sales and marketing expense, and expects someone else to purchase a division partially viable and partially failing. Right now there's generally three steps to the
consumer (us): mfg, distributor, retailer. Each step need to make a profit. Now they're
contemplating a fourth step in there, who has to make profit too, or they have no motive.
The end result, even with hypothetical greater efficiency, is inflated film prices, even beyond what they are now - hence inevitable reduced demand. Thank goodness, freezers
are still relativelly cheap!

[Daniel Stone]

IMO, it'd be easiest to just cut out the "middlemen" all together, and take distribution in-house. That would 1. remove one step of markup, and 2. make it easier for Kodak to be "in touch" with their retailer network. Running a warehouse where stockmen could have a palletized, rack system(ala Costco style) w/ SKU's on a barcode system, and then keep the whole warehouse @ 55F year-round. That way retailers could just "phone up" Kodak directly, think ordering on the phone from Freestyle, "you want (x) of (x).... and (25) of (X)...." This would be a direct marketing/sales for retailers. If they were to also have a SET selling price for retailers, that would allow smaller shops to be able to order @ the same price-point as B+H. Therefore increasing local purchases rather than ordering from across the country(as I do, to save the sales tax generally, which can be hefty since I personally "bulk" order my film 1-2x/yr)...

This is just a hypothetical situation, a warehouse could have MAYBE 8-10 fulltime employees, they don't need to be salaried, indentured, or even on a pension system. Simple hourly employees that are graced with having a job in a down economy. Surely Kodak must have thought of this, or are upper level management still in Barbados on vacation ;)?

-Dan

[Drew Wiley]

It would be a major headache to do it that way, Daniel. There are probably no retailers left
who could generate sufficient sales volume to make it worthwhile, and it would greatly
complicate paperwork, credit, collections, etc - everything they actually need to simplify
if they going to stay around. And simple "hourly" people with no benefits don't do good work - they have no incentive, are filled with resentment, will handle goods roughly, and will move on if they can. Costco doesn't operate on that skinflint principle, and neither should any other legitimate business in this country.

[Frank Petronio]

Forget the smaller retailers since they already gave up on each other years ago anyway.

Take the Kodak brand and do what a couple hipsters did with Lomo or the Impossible Project, and just sell film and even other brands of film-related gear over the Internet. Once that takes off, open boutique stores in major cities aka Apple, Leica, or the Impossible Project. Still sell wholesale to major vendors like Freestyle and B&H, much as Lomo does now.

Make it a high end brand again, staff the internet center and stores with "geniuses", offer classes, galleries, and inspiration. It could scale 100x what Lomo has been doing and they could strategically partner with good companies to promote film usage to a new group of younger customers.

Of course they have to go bankrupt and cut themselves lose from the old company's obligations and make a fresh start.

[BrianShaw]

...

Right now there's generally three steps to the consumer (us): mfg, distributor, retailer. Each step need to make a profit. Now they're
contemplating a fourth step in there, who has to make profit too, or they have no motive.

...

Am I incorrect, but isn't it essentially the "distributor" step that they are contemplating selling? I don't see an additional step. I thought distributor did all of the packaging, marketing, etc to the retailers... or take on a driect-to-consumer sales approach.

[BrianShaw]

Just doesn't make a lot of sense to me. Kodak wants to lower their overhead by divesting
themselves of sales and marketing expense, and expects someone else to purchase a division partially viable and partially failing.

That's the part I don't get either -- how some people know how to take risks like that. They are legion. And if they fail they just do it all over again with a different risky venture.

[Drew Wiley]

Frank - once you get into the idea of direct internet sales, you're existing distributors will
likely dump you (they can't have it both ways), and then they've got another kind of huge
headache with potentially knucklehead Satrbucks types running it. Good way to go out of business forever. I'm just about to dump a mfg for attempting that - and I'm their biggest
account on the West Coast! It costs me time and money to stock the products and deal
with any aftermarket issues - no online service is going to bother with that, or in most cases, even bother giving their staff a true legal wage, let alone a livable one.

[Drew Wiley]

Maybe we should all simply invite the Kodak CEO to a roundtable discussion in a tent cabin
in Yosemite, but with one less respirator on hand than the number of people invited!

[BrianShaw]

He probably already goes to Bohemian Grove. Have they had an outbreak yet? ;)

[Frank Petronio]

He is driven into an underground garage in his Bentley, avoids as much public contact as possible. Imagine he'd get pelted with truffles and sashimi if he dared showed his face at the Pittsford Wegmans....

[rdenney]

Forget the smaller retailers since they already gave up on each other years ago anyway.

Take the Kodak brand and do what a couple hipsters did with Lomo or the Impossible Project, and just sell film and even other brands of film-related gear over the Internet. Once that takes off, open boutique stores in major cities aka Apple, Leica, or the Impossible Project. Still sell wholesale to major vendors like Freestyle and B&H, much as Lomo does now.

Make it a high end brand again, staff the internet center and stores with "geniuses", offer classes, galleries, and inspiration. It could scale 100x what Lomo has been doing and they could strategically partner with good companies to promote film usage to a new group of younger customers.

Of course they have to go bankrupt and cut themselves lose from the old company's obligations and make a fresh start.

This is exactly the correct strategy, it seems to me. Many storied old American mass-producers have found new life, at least as a brand, by becoming a high-end boutique item rather than a mass-production item. Example: Schwinn bicycles, which used to make all their money making (well-made) low-end bicycles in high volumes, found that they ultimately could not compete with Asian mass-producers, when the only measure of competition was price point. Schwinn went broke, the brand was bought by a conglomerate, who then also went broke, and the brand was sold to yet a different conglomerate. That conglomerate owns the brand, but not the prestige end of the market. On the other hand (and more relevant for us), Richard Schwinn bought out the Schwinn Paramount facility (with others) and started making Waterford bicycles, a highly respected boutique brand sold directly to cyclists, or to a select group of high-end bike shops (not through distributors).

Kodak may find a mass-production market for some of their product lines, but if they want to sell film, they will need to build a high-end boutique-brand business model, which means a direct-to-consumer high-service delivery model, rather than selling product in chain retail stores the way they used to.

Fuji could learn this lesson, too.

The cost of production includes a large fixed cost (the machinery and the people needed to operate it). It needs to serve various disparate market areas to stay productive, including cinema and still film. And even still film serves a couple of different markets. But still film could easily be sold as a boutique item over the Internet with a very low distribution and retailing cost. A few of the bigger camera stores will still buy it at wholesale and sell it, but the business model won't be based on a dense retail sales chain the way it was. It will remove the distributor between the brand owner and the retail outlet in any case. They may not be able to reduce the fixed plant expenses, but they can reduce the cost of sales.

Rick "not sure about the branded boutique stores, though" Denney

[rdenney]

Frank - once you get into the idea of direct internet sales, you're existing distributors will
likely dump you (they can't have it both ways), and then they've got another kind of huge
headache with potentially knucklehead Satrbucks types running it. Good way to go out of business forever. I'm just about to dump a mfg for attempting that - and I'm their biggest
account on the West Coast! It costs me time and money to stock the products and deal
with any aftermarket issues - no online service is going to bother with that, or in most cases, even bother giving their staff a true legal wage, let alone a livable one.

Drew, you are building a castle in the air, it seems to me. The distributor model is what is truly dead regarding film, if the film is not going to be sold in non-photographic retail outlets like drug, grocery, and department stores. And those are the outlets that are vanishing altogether. Trying to support a distribution model to support a non-viable retail chain is likely a bigger problem than keeping the machines going. I suspect that there are fewer retail stores that could sell any useful quantity of film products than there were distributors 20 years ago. The factory should just sell at wholesale directly to them. That way, they can increase their cost model to maybe 40% of retail rather than 10 or 15% of retail as they currently must do with a multi-layered distributor business model. Without the distributor layer, they can scale costs up or down far more quickly in response to the market.

By the way, Starbucks mostly owns its retail outlets, and their model depends on walk-up retail sales. It's a completely different retail service model than what would be appropriate for Kodak as Frank describes it.

Rick "more direct is better" Denney

[BrianShaw]

B "I agree" S

[adam satushek]

I really like the idea of Kodak boutique stores. Yellow Kodak branded store fronts would look awesome. And yeah they could do workshops, classes, photo shows, and sell inexpensive hip cameras like lomos, holgas, and 4x5 pinholes (or Ben Syverson's Wanderlust..?...), just fun cameras to get people hooked on film. Seems like offering developing, scanning, and printing services would be a good idea too. They could also sell hip photo related gear like vintage looking Kodak shirts and hats and scarves and such to get the kids interested.

I like to think there would be enough of a market for them....but i certianlly am not a business man....if it was me I would throw a cocktail bar in there too just for good measure....

I joke (a little), but it actually seems like a great idea. Again, I am pleased with any solution that results in me being able to continue using Portra.

[Oren Grad]

Kodak may find a mass-production market for some of their product lines, but if they want to sell film, they will need to build a high-end boutique-brand business model, which means a direct-to-consumer high-service delivery model, rather than selling product in chain retail stores the way they used to.

FWIW, so far Harman has resolutely stuck with a national-distributor model. Their situation is a bit different, in that they were never in every drugstore like Kodak was. Nevertheless, the number of retail outlets carrying Ilford products has contracted considerably too.

[rdenney]

FWIW, so far Harman has resolutely stuck with a national-distributor model. Their situation is a bit different, in that they were never in every drugstore like Kodak was. Nevertheless, the number of retail outlets carrying Ilford products has contracted considerably too.

Of course, Harman products must be imported into the U.S., which make a distributor important to run interference with the powers that be over such matters.

Rick "suspecting that the importation issue is at least part of Fuji's problem in selling low-volume stuff in the U.S." Denney

[Oren Grad]

I should add that they have started to experiment with direct selling in the UK:

http://www.harmanexpress.com/

[Drew Wiley]

Rick - all the Kodak around here anyone buys is from some distinct retailer, either a lab
selling film on the side or a traditional camera store. You can get almost anything in the
neighborhood itself except for color 8x10 film. Then you've got retail online or mailorder
options like Freestyle and B&H. Making enemies of one's longtime support isn't likely to give
you a good recommendation. Starbucks can hardly afford all their stands and are shutting
them down right and left. And everyone drinks coffee! Kodak needs to lower overhead,
not increase it with staffing and endless shipping headaches. Maybe if Kodak married someone like Amazon.com, but then their profit margins would fall so low that they'd be
doomed for certain. At this point in time, their best option would probably to be dig a hole
in the desert and put themselves at the mercy of a Mexican Mafia hit squad.

[rdenney]

Drew, I think it will be required of whomever buys the consumer film division to combine distributorship, some retail, and factory warehousing functions. The enemies they make of the distributors will likely not cause any damage--those distributors are part of the reason their prices are so high and part of the reason they have no agility to deal with a rapidly changing market. I doubt that making their products available online at a cheaper price, (or through retailers like B&H and Freestyle at perhaps slightly lower prices) will annoy any of their buyers, who are annoyed now when supply is not stable or affordable.

Maybe Kodak still sell enough 35mm in non-photographic retail outlets to warrant distributorship for that product line, but maybe not, or maybe not for much longer.

The point is to move away from price-point selling, which is what the distributorship model is aimed at (it measures success by the number of retail outlets that carry the product) towards boutique selling with a higher margin (meaning: lower costs). So much of business success is finding the performance measure that aligns with the true commercial objectives. Amazon is based on a volume model, not a boutique model--I doubt that would be part of the solution. We can already buy lots of Kodak film products on Amazon--and the problem remains. Kodak doesn't need distributors that are expensive on a per-product basis when the volume is low. Kodak only needs to be big enough to pay the bills on the machinery--everything else needs to be scalable to reduce costs.

Rick "suspecting the distributors are not part of the solution" Denney

[Drew Wiley]

I don't believe that hypothetical distribution models would even be the crux of the problem
with any potential buyer of the label. The bigger problem is that they'd have to be married
at the mfg level to the same brass who put the company in this mess to begin with.
Who wants to be in that position? It could be worse. Some "vulture capitalist" (sorry to
borrow a trendy phrase at the moment) could simply speculate on another acquisition and
ruin it all; but ideally, Kodak film would be better revived on a privately-held basis - but
if that, in turn, is hostage to the pendulum of Kodak's publicly-held structure, what would
be the point? Gotta be pretty dumb to step into that mess! So they just might be stuck in
the existing distribution model for the duration. I could be otherwise, but something about
the current mgt just doesn't seem to inspire creative efficient options.

[Frank Petronio]

I'm pessimistic too but it's impossible for us chickens to know if the film line could be a viable stand alone company? I'm not risking my money beyond getting a year's supply of Porta and a stash of TXP... Otherwise they are on their own, good luck.

Not going to hoard color film since once it is discontinued, processing is going to get painful after the first year or so....

I do know that boutique model would make me a happy customer, I don't see why I should have to pay a middleman like B&H? They don't exactly "service" film.

[Peter York]

I don't believe that hypothetical distribution models would even be the crux of the problem
with any potential buyer of the label. The bigger problem is that they'd have to be married
at the mfg level to the same brass who put the company in this mess to begin with.
Who wants to be in that position? It could be worse. Some "vulture capitalist" (sorry to
borrow a trendy phrase at the moment) could simply speculate on another acquisition and
ruin it all; but ideally, Kodak film would be better revived on a privately-held basis - but
if that, in turn, is hostage to the pendulum of Kodak's publicly-held structure, what would
be the point? Gotta be pretty dumb to step into that mess! So they just might be stuck in
the existing distribution model for the duration. I could be otherwise, but something about
the current mgt just doesn't seem to inspire creative efficient options.

+1 Kodak's problem is and has always been management with no vision. I guarantee you that these hypothetical models being bandied about here do not enter their pea-sized minds. Spin-off this printing BS, sell as many patents as possible, and get down to running a much smaller, more efficient, film company. Get corporate out - this is not the type of business anymore for that. Its boutique, retro, etc. or it is no more.

[Drew Wiley]

Frank, there might be some hypothetical possiblity of a key dealer handling volume orders at modest profit (kinda like the group orders we currently do now for custom cuts of film with Keith Canham), but what about the guy who just wants a box of film - damn, at $35 for a box 0f 4x5 Portra and $150 for 8x10, just how much cash do you have to spend a pop as it is? But any "botique" other than online with a sweatshop payscale would be impossible to imagine given typical overhead. At least at a camera store, you've got some
miserable minimum wage gofer selling a hundred other things than film itself, and spreading
the overhead across a wide spectrum of goods. This would really be the hypothetical new
owners' problem to figure out anyway. Chances are, they're not going to find a purchaser
for mere marketing rights. New Kodak motto: Buy the Headaches, We'll do the Rest"!

[John Kasaian]

if they want to sell film, they will need to build a high-end boutique-brand business model, which means a direct-to-consumer high-service delivery model, rather than selling product in chain retail stores the way they used to.


Kodak sheet film already is a high end boutique film!

[rdenney]

Kodak sheet film already is a high end boutique film!

Right. But they are still selling it through high-cost, volume-oriented retail channels. And they are producing it with a plant designed for high-volume production. They can't do anything about the latter, but they should do something about the former.

Blaming management for lack of vision is easy, but I wonder if any of us sat in a room with Perez whether we'd find him as dumb as we make him out to be here, where we are at a safe distance. Any good business response to sheet film would be to discontinue it altogether. At least Kodak is trying to find some mechanism for maintaining its future production, at least for a while.

And we talk about how George Eastman would be rolling in his grave, but it was he who established the strategy favoring mass-market products at the expense of high-end boutique items.

This is how big corporations think. General Motors ceased production of its innovative and successful motorhome back in the 70's for many reasons. But the main reason was: "We can make 100 pickups in the space and time it takes to make one motorhome." Small companies don't think that way. But big corporations didn't start out thinking like big corporations, or they would have never gotten big. We should also not forget that undertaking a losing proposition for the sake of establishing brand value is something that must be part of a stated strategy. Sarbanes-Oxley makes it quite difficult for a corporation to lose money on purpose without such a strategy, for fear of the SEC coming down on them on behalf of minority stockholders. In my previous employment, I had to turn down work that forced an overhead rate below what was profitable for the (public) corporation, even though those projects might have improved our visibility and marketability in more profitable ventures, because of the certifications we had to make as a part of Sarbanes-Oxley. I found myself wishing we were privately owned on many occasions.

Rick "thinking it likely that nothing will work, but knowing that the current approach does not work in a public corporation environment" Denney

[Sal Santamaura]

Kodak sheet film already is a high end boutique film!


Right. But they are still selling it through high-cost, volume-oriented retail channels. And they are producing it with a plant designed for high-volume production...And, in the case of 8x10 320TXP, one volume-oriented retailer (B&H) moves so much that, despite Kodak having made it a special order item, the dealer keeps placing special orders that sell.

In the last few days B&H's stock of that film has been replenished again. They had only 70 boxes, now they're back up to 262 boxes. And they haven't raised the price either.


http://www.bhphotovideo.com/c/product/533812-USA/Kodak_8179707_TXP_4164_8x10_Tri_X.html

When strong demand exists for a specific product, all the distribution/retailing details become less important.

[Drew Wiley]

Well Rick, I have sat down at the table with quite a few mfg CEO's. Some are very bright,
but some are indeed the dumbest person in the room. I'm going thru fits right now - the
biggest mfg in the world of a particular category of commodity - they buy out a major brand that went bankrupt in six months do to a very stupid predictable mistake - buy the
entire corp for a nickel on the dollar - fire their own high-quality people because the marketing monkeys from the other corp are way cheaper - then let these guys go about
repeating the exact mistake that put them in bankruptcy the first time! Doing this dumb
the first time is bad enough, doing it back to back???? It never ceases to amzaze me at
how good corporations can be at committing suicide. But there generally is a pattern to it:
listen to some twenty-something whiz kids and ignore both your existing customers and
your own experienced people.

[BrianShaw]

Well Rick, I have sat down at the table with quite a few mfg CEO's. Some are very bright,
but some are indeed the dumbest person in the room. ...

One has to understand the goals of each exec before one can cast judgement on either their intelligence or motives. And the problem is that they tend to be good at the art of poker playing (AKA misleading, bluffing, patronizing, or whatever other euphemism for "lying" one may care to use)... so getting to understand both is difficult even if one is sitting across the table from them.

If any of use were either smart enough or politically savvy enough... we'd be sitting behind the desk in their big office trying to make the decisions they find so difficult to make.

But it is easy to see the errors they make along the way, huh, even when they allege to be open with their goals.

[Drew Wiley]

No Brian ... some of these guys are really really dumb, largely because their egos are way
bigger than their level of experience. They tend to be high energy types who are really
skilled at schmoozing - they were president of the fraternity etc and still throw the best
party in town. They know how to hobknob and bluff their way, juggle meaningless numbers, etc. - but often have precisely ZERO experience running the kind of business they are put in charge of. Without mentioning the name, I know a nearly hundred year old
thriving mfg company that had survived just about everything, then was effectively shut
down by a CEO who came from a potato chip company, from which he was fired! In fact,
he had bankrupted three previous corporations, but still managed to land another prominent position with a multimillion dollar golden parachute contract. And you try to tell
me the system isn't rigged??? Yeah, they're smart - but at enriching themselves at the
expense of the very corporations they're entrusted to run! But in terms of actual mfg
competence, some of these guys are close to zero, and everyone around them know it too. That's why they so often fire eveyone with any real track record and replace them
with smartass inexperienced MBA's. It happens way more often than you might think.
I could rattle off a least a dozen major manufacturers that I personally dealt with that
considered themselves invincible, yet went down the drain within six months to two years
due to idiotic arrogant managment.

[Sal Santamaura]

...If any of use were either smart enough or politically savvy enough... we'd be sitting behind the desk in their big office trying to make the decisions they find so difficult to make...Many of us are smart enough. Some of us are politically savvy enough. But few of us who aren't sitting behind the desks in their big offices lack or are able to suppress the integrity and and honesty they lack or suppress for their own personal gain.

[Drew Wiley]

Maybe some of us would rather make a modest but honest middle-class living than puff
ourselves up using political personality tricks. There's more to life than money, and greedy
people never seem to be happy or ever have enough - it's always more, more, more.
Maybe I'm just experienced enough to see thru their tricks - but's that's what I'm paid to do. Don't get me wrong - I do know certain CEO's who are truly competent and truly earn
their pay - but that's more typical of privately rather than publicly-held corporations.

[BrianShaw]

No Brian ... some of these guys are really really dumb, largely because their egos are way
bigger than their level of experience. They tend to be high energy types who are really
skilled at schmoozing - they were president of the fraternity etc and still throw the best
party in town. They know how to hobknob and bluff their way, juggle meaningless numbers, etc. - but often have precisely ZERO experience running the kind of business they are put in charge of. Without mentioning the name, I know a nearly hundred year old
thriving mfg company that had survived just about everything, then was effectively shut
down by a CEO who came from a potato chip company, from which he was fired! In fact,
he had bankrupted three previous corporations, but still managed to land another prominent position with a multimillion dollar golden parachute contract. And you try to tell
me the system isn't rigged??? Yeah, they're smart - but at enriching themselves at the
expense of the very corporations they're entrusted to run! But in terms of actual mfg
competence, some of these guys are close to zero, and everyone around them know it too. That's why they so often fire eveyone with any real track record and replace them
with smartass inexperienced MBA's. It happens way more often than you might think.
I could rattle off a least a dozen major manufacturers that I personally dealt with that
considered themselves invincible, yet went down the drain within six months to two years
due to idiotic arrogant managment.

But that is EXACTLY supporting what I said -- in many cases their goal is not to run an effective corporation and produce a good product... it is to add another $$ to their personal compensation. All the rest of their talk is often rhetoric. Expecting them to have more noble goals is an exercize in frustration.

I know how often it happens -- I live in a corporate world, just one step below the self-serving bullsh!t... and I interact with it every day.

[BrianShaw]

Many of us are smart enough. Some of us are politically savvy enough. But few of us who aren't sitting behind the desks in their big offices lack or are able to suppress the integrity and and honesty they lack or suppress for their own personal gain.

Yes, indeed. I am with you 100% on that one! I'm comfortable with my career and salary but find myself struggling a little more every day. I have bopth emotional and ethical comfort, though.


Maybe some of us would rather make a modest but honest middle-class living than puff
ourselves up using political personality tricks. There's more to life than money, and greedy
people never seem to be happy or ever have enough - it's always more, more, more.
Maybe I'm just experienced enough to see thru their tricks - but's that's what I'm paid to do. Don't get me wrong - I do know certain CEO's who are truly competent and truly earn
their pay - but that's more typical of privately rather than publicly-held corporations.

Amen.

[BrianShaw]

p.s. I was once an optomist and really believed in the inherent "goodness of mankind." Surviving too many years seems to have made me a cynic and mroe of a bliever that only good men(including women) are good. As a great judge of character I hope I see hte difference clearly and don't misjudge people... but often self-serving motives are too easily seen.

[Drew Wiley]

Well, I don't even have the kind of nervous energy for that kind of thing, even if I had the
necessary unethical qualifications. I just want out - leave the company I'm currently working for in real good shape, retire, and have some quiet time to shoot and print. But behind the madness, there is often method - someone does know what they're doing, esp
if buyout are involved. Those are always a red flag. Big amoeba corporations buy out smaller ones, call it a love marriage; but it's often a trojan horse for acquiring a marketing
label while permanently diabling the competitor with one stroke. Outsourcing if often a key
component. Hence the CEO himself becomes a pawn - they actually want a numbskull with
a bad reputation to destroy the acquisition from the inside, consciously or not. Then they
can blame him for doing the dirty work, then fire him with a big golden parachute contract
for the favor. Then another big corp will hire the same jerk for the same reason. Somebody
always gets rich, but it's not the little stockholders!

[BrianShaw]

I just want out - leave the company I'm currently working for in real good shape, retire, and have some quiet time to shoot and print.

I'm in more of a service industry and just want to serve my customer well... only to face politics and numbskulls on both their side and ours. Grrr... another decade of this is in the cards.

So now I'm off to build some EOY briefing charts for the execs on all the good things "they" did this FY.

[rdenney]

Maybe some of us would rather make a modest but honest middle-class living than puff
ourselves up using political personality tricks. There's more to life than money, and greedy
people never seem to be happy or ever have enough - it's always more, more, more.
Maybe I'm just experienced enough to see thru their tricks - but's that's what I'm paid to do. Don't get me wrong - I do know certain CEO's who are truly competent and truly earn
their pay - but that's more typical of privately rather than publicly-held corporations.

Inherent in this statement is that the driving motivation of typical CEOs is personal financial greed. I've known my share of egotistical CEOs, and of CEOs who don't know their industry and don't want to listen to their experienced people. I've known CEOs and CEO wannabes whose main qualification is their HBS degree or their golf partner. I've even watched one of my previous bosses, who owned his company, go straight to prison. But I've known very few who would throw their company under the bus just to sweeten their compensation package. They all wanted the company to succeed, seeing that as the path to achieve their personal goals. Even the one who went to prison was caught paying off a bureaucrat (who spend even longer in prison) in order to improve his chances of winning projects.

But we weren't talking about CEOs in general. We were talking about Perez, and Kodak, and sheet film. Let's assume, just on a lark, that Perez is trying to find a path forward for Kodak that successfully takes them out of bankruptcy into long-term sustainability. Will maintaining consumer film production do that? I don't see how. Sure, stopping that production might undermine any chance of getting a return on investment on the development of newer films such as Ektar, but ROI for one tiny sliver of the business footprint might not be important when cash flow is in crisis. Selling off the branding might be the only strategy for survival.

Selling their intellectual property does seem like selling blood, and they are anemic as it is. But that's not the issue that affects us directly.

And how is selling a piece of a company to a competitor so that the competitor can throw it away and remove the competition a useful description here? There is no competitor for color negative sheet film in the U.S. Fuji has abandoned the U.S. market altogether. If they bought the consumer film division, shut it down, and imported their own stuff now that it was free of competition, that might actually be the best thing for us. And it may be our only hope of having available color sheet film.

What I do see is Kodak trying to keep consumer film in production...somehow. If the company was driven solely by the motives you ascribe, they'd have dumped it altogether long ago. Nobody among their stockholders, big or small, would have shed a single tear.

Rick "who has known quite a few CEOs" Denney

[rdenney]

I'm in more of a service industry and just want to serve my customer well... only to face politics and numbskulls on both their side and ours. Grrr... another decade of this is in the cards.

So now I'm off to build some EOY briefing charts for the execs on all the good things "they" did this FY.

It could be worse. You could work for government.

Rick "!" Denney

[Steve Goldstein]

OK, I give up. A few posts back Sal mentioned B&H's stock quantity of 320TXP in 8x10. How do you guys figure that out? I couldn't see anything on the page Sal linked to that would tell me, or lead me to the answer.

[Drew Wiley]

It's called a phone call ... that's how you find out. Anyway, its nice to know that B&H is also stocking 8x10 TMY, Ektar, and Portra. Seems that these particular films are doing quite well and justifying relatively frequent runs. But is that due to us hoarders buying up
several years worth at at time? And how long can that habit last? And how much of the
cumulative overhead of that particular division does even this particular arena of success
actually offset? Difficult to say, since one of things typical mgt does is play shell games
with numbers. And I don't understand how Kodak can divorce the overhead of commercial
film from "consumer". Distribution per se can be accomplished a number of ways, some better some worse - but who wants to buy the brand label too if they can't control the fate of actual manufacture? (No, it won't be Fuji - they probably have better things to do
and are inscrutable anyway, just several Japanese corporations I can think of).

[Drew Wiley]

Rick - I don't pretend to know what's going on in the head of Kodak's CEO because he's
apparently willing to go down with the ship. I'll give him credit for that. But to suggest that
certain others don't have bad motives is pretty naive. They have every financial incentive
to run the ship aground. Simply stated, they get paid way more if they get fired than if
they run the company intelligently. And given the fact that a lot of them don't last more
than a couple years anyway due to the instant gratification model of Wall St, why would
they have any loyalty to anything but themselves? The folks from the GE background were
positively the worst, and anytime any of them was put in charge running something else,
it was "dump it fast" from anyone in the know.

[BradS]

OK, I give up. A few posts back Sal mentioned B&H's stock quantity of 320TXP in 8x10. How do you guys figure that out? I couldn't see anything on the page Sal linked to that would tell me, or lead me to the answer.


easy, goto the B&H web site, find the page for 8x10 320TXP, click add to cart then click view cart. Now change the quantity to 200 and click update cart. it does not complain so, change the quantity to 300 and click update cart. it complains and tells you it only has 262 available.

[Jan Pedersen]

OK, I give up. A few posts back Sal mentioned B&H's stock quantity of 320TXP in 8x10. How do you guys figure that out? I couldn't see anything on the page Sal linked to that would tell me, or lead me to the answer.

Steve, put a high number of the film you want in your shopping cart, if the number exeed the available qty you will get a message with the number they have in stock.

Brad beat me on the keyboard.

[Sal Santamaura]

...A few posts back Sal mentioned B&H's stock quantity of 320TXP in 8x10. How do you guys figure that out?...http://www.largeformatphotography.info/forum/showthread.php?84366-More-Kodak-discontinuations&p=817518&viewfull=1#post817518

Brad and Jan both beat me to the keyboard. This time -- not last December. :)

[Sal Santamaura]

...its nice to know that B&H is also stocking 8x10 TMY...Seems that these particular films are doing quite well and justifying relatively frequent runs...Since I notified everyone here about B&H's decision to stock 8x10 TMY


http://www.largeformatphotography.info/forum/showthread.php?87303-For-those-seeking-8x10-TMY-2

they've had no need to reorder it from Kodak. Of the original 271 boxes, 85 remain in stock. Even with a $3.00 lower price than Canham wants per box. It's no wonder Canham currently shows he still needs 91 boxes ordered before submitting and hasn't successfully completed such an order since January, 2011.

B&H has sold much more 8x10 320TXP in that almost 7-month period; I can recall them replenishing it on at least three occasions, each time going from somewhere in the neighborhood of 35 boxes back to near 275 boxes.

[Drew Wiley]

Relatively low demand compared to TMY. Each time I ordered some 8x10 TMY it came in a different batch code, so was being coated frequently. Even TMX seems to be getting cut
at least annually. I should look at my various purchases of Ektar sheet film to see what that sequencing look like. Compare that to something like Tech Pan, which allegedly took
over a decade to clear off the shelves after the last run.

[BrianShaw]

Selling off the branding might be the only strategy for survival.

... and it could be a short-term strategy, and not even a short-term strategy for film survival. Only time (or a fly-on-the-boardroom-wall) would know.

[Sal Santamaura]

Since I notified everyone here about B&H's decision to stock 8x10 TMY...they've had no need to reorder it from Kodak. Of the original 271 boxes, 85 remain in stock...B&H has sold much more 8x10 320TXP in that almost 7-month period; I can recall them replenishing it on at least three occasions, each time going from somewhere in the neighborhood of 35 boxes back to near 275 boxes.


Relatively low demand compared to TMY. Each time I ordered some 8x10 TMY it came in a different batch code, so was being coated frequently...During this year, demand for 320TXP has been substantially higher than for TMY. Perhaps TMY's price ($30 more than 320TXP per 10-sheet box, both at B&H) has exceeded what a large part of the market will pay for it.

[Drew Wiley]

Is that cumulative, Sal, or just what B&H has done? But I do admit, I personally paid substantially less for TMY than the going rate at the moment. And I know that a single
industrial user bought up two entire lots of TMX 8x10 in a row. The really tough one is
color 8x10. Glad I packed my freezer when it was going for half the current price.

[Sal Santamaura]

Is that cumulative, Sal, or just what B&H has done?...I've only been watching the turnover at B&H, but it is probably the largest retailer of these items in the country and should be fairly representative of the market as a whole. Besides, I'm unaware of any other dealer offering 8x10 TMY as single-box open stock, so other retail sales of 8x10 320TXP would only make the demand imbalance this year greater.

I think color film won't be long for this world. Anyone stockpiling it for the long term would do well to develop a skill at formulating associated processing chemistry from scratch. Commercial soups likely won't be sold for too long when the film disappears.

[Drew Wiley]

Sal - I was told by a friend who not long ago visited B&H in person that their stock of actual film is far less than it once was (but seems to have been increased in the meantime). I was buying my own 8x10 films elsewhere when they had virtually nothing, so
no, I wouldn't consider them to be a reflex of the overall pattern itself, just part of it.
Still plenty of color film being sold and developed around here, in every format except 5x7.
I don't see any sign of that ending soon. Kodak should have enough momentum to keep
going awhile, and perhaps survive film mfg IF they can play their cards right. Even Kodachrome had someone to process it right until the bitter end. Perhaps a few bricks are
still around, but they'd be a miniscule percentage of the overall product that was sold.
But yes, evolution is the name of the game. I'm not personally worried, because I imagine
I'll be a pretty old geezer anyway when things wind down, and if I have to, can always
shift into exclusively black and white work. Just saw Ron Partridge's son-in-law a minute
ago, who lives with him, and he's still platinum printing in his 90's. Hope my fingers hold up
that well.

[georgl]

Their film-business is profitable, they have a fairly new and productive fab in Rochester and they have unique know-how in a technical field which can be used in other (non-photographic) applications as well.

They need a long-term investor and independence from the shareholder-value based management.

What about a group of enthusiasts? People from Hollywood, wealthy film-loving professionals - Mr. Spielberg alone could propably afford to buy it and transfer it into a foundation.

[Oren Grad]

Sal - I was told by a friend who not long ago visited B&H in person that their stock of actual film is far less than it once was (but seems to have been increased in the meantime).

You can't tell anything by visiting the store, other than that the walk-in trade isn't interested in film any more. They've cut way back on in-store stock accordingly. If you probe the website per Sal's approach, the warehouse is still pretty well stocked.

[Frank Petronio]

Right, in the old days you could run down to B&W from your loft and keep shooting that 8x10 job. Nowadays the people who buy 8x10 film are all over the world, not so much in the former Photo District.

[Drew Wiley]

I have no idea if 8x10 film is still being stocked much in SF or not. I never drive over there
anymore. 8x10 b&w, and 4x5 everything is still avail right in the immediate neighborhood.
Some of the colleges, as well as UCB, still seem to use a lot, and there's still quite a bit of
amateur use. Lot of color RA4 paper too. Most studio photographers are obviously under
the "need-it-yesterday" syndrome that now comes with digital preview options, but some
apparently want to find a specialized niche by offering film too. It's pretty complicated
and competitive, as photography as a living always has been. The average website and
wedding photographer could probably use a cell phone and nobody would know the difference; but there are still a few real pros in that market too who prefer to do things
the right way, and unlike the wannabees, make a good living at it too.