Kodak to stop selling traditional cameras in U.S.

Reuters | January 13, 2004

[HAL9000]

Eastman Kodak said Tuesday it will stop selling traditional film cameras in the United States, Canada and Western Europe, another move by the photography company to cut lines with declining appeal in favor of fast-growing digital products.

With sales of digital cameras poised to overtake film cameras for the first time this year, Kodak is redefining itself in an effort to keep pace. But the No. 1 maker of photographic film will continue to sell one-time use cameras in the West and expand its sales of these and other film-based cameras--and film--in emerging markets where demand is on the rise.

Shares of Kodak eked out narrow gains Tuesday after the announcement, and was one of the few blue chip stocks to close higher on the New York Stock Exchange.

The move comes amid Kodak's controversial plan to focus on high-growth digital products, such as medical imaging systems and production printing, and reduce dependence on its declining film business. Late in 2003, Kodak said it would stop making slide projectors, but still manufactures color slide films.

"Every one of these steps indicates more and more the strength of Kodak's conviction of moving toward digital," said analyst Shannon Cross of Cross Research. "However, the jury is out on whether (the digital strategy) will work."

Blaming declining demand, the Rochester, N.Y.-based company said it would by the end of this year quit making reloadable cameras that use 35-millimeter film, including those in the Advanced Photo System (APS) format.

In 1996, when it was unveiled, Advantix was hailed by Kodak as the "most important photographic announcement since Instamatic cartridge-loading cameras were introduced in 1963."

Kodak will still make film for existing Advantix and other cameras, and intends to introduce new high-performance 35mm and APS films next month.

Camera makers typically make little profit--or lose money--on hardware, but enjoy strong margins from sales of supplies such as film and paper, which must be replaced frequently.

Kodak said that it plans to continue making reloadable cameras that use 35mm film for emerging markets, such as China, India, Eastern Europe and Latin America and that it will introduce six new cameras in those markets this year.

"(We) estimate that there are 60 million Chinese consumers who have the purchasing power to participate in photography, but have not bought their first camera," Kodak spokesman Charles Smith said.

Under Kodak's new strategy, unveiled in September, it will shift its investments into digital markets with greater growth potential than the waning film market. But film still provides ample revenue for Kodak--more than 120 million rolls of film are sold each year industry-wide.

According to estimates by InfoTrends Research Group, global film camera shipments in 2004 will shrink to 36 million units from 48 million in 2003, while digital camera shipments will rise to 53 million from 41 million units.

Other companies that helped develop APS--Canon, Fuji Photo, Minolta and Nikon-- will continue to make APS cameras.

"The consumer who has APS likes it a lot, but the growth potential is probably tapped out from Kodak's standpoint,'' said Gary Pageau, spokesman of the Photo Marketing Association, an industry organization.

[MarkL]

Why would anyone in the market for a professional digital SLR buy a Kodak rather than a Nikon. Nikon has a huge collection of high quality lenses that can be used with their cameras.

I don't know if it's still the case, but Kodak used to use Nikon bodies to base their cameras on, and I know that they used to have some of the best imaging technology and software for their pro cameras.

Mark

[Paleo Conservative]

I understand Moore's Law, but there's more to picture quality than just resolution. Film handles high contrast better. Video transferred from film even looks better than video shot directly onto digital video.

[MarkL]

It probably will for quite a while. I seriously doubt digital camerals will match the resolution of 4"x5" or 8"x10" view cameras anytime soon.

I miss my old Speed Graphic... I know, not quite a view camera, but still, it was great! And it was cool using that sort of camera...

I've heard that Kodak has medium format 14MP backs for different cameras.

Mark

[DCPatriot]

Don't get rid of your standard camera. You never know.

A power failure here. An electro magnetic field there, and you're going to need the powder tray of Jesse James' Day.

[Psycho_Runner]

Yah I am pretty enthusiatic about digital photography. By going digital you gain so much more control. From Cropping the photo to lightnening up a photo, it is really unbelievable.

One thing I have notice from the die hard film users, they pooh, pooh digital. I think the reason being is the emotional attachment to tradition.

Well I beleive in traditional values, I just don't beleive in traditional consumer products like Black and white television, network television, Typewriters, Polaroids, and even regular phone lines.

Oh and by the way, my first digital was Kodak 4.0 megapixel. I still use for work, as now I consider it somewhat disposable.

Anyway, just my humble opinion

[luvbach1]

Digital SLRs cost a small fortune. Older, auto-exposure film SLRs still do a great job and on a budget.

[luvbach1]

Nikon has a huge collection of high quality lenses that can be used with their cameras.

So does Pentax (though not as large as Nikon)and at a lower cost.

[Johnny_Cipher]

What Kodak should consider doing is to develop and market an inexpensive home 35MM film processing kit. They could push the (still) higher resolution and better quality contrast of "real" film, while designing the processor so it could be connected to your computer and be used to produce digital images as well.

High-end users already either develop their own or send exposed film to a lab, while everybody else still using 35MM film has to send it off to the drugstore to get it developed. It would be nice to have a printer-sized box of some sort, perhaps even used with a home computer, that did this for you at home.

[MediaMole]

The 14n is based on a Nikon body and takes Nikon lenses.

[JoJo Gunn]

His name was Rolf Szabo.

"Diversity" wasn't so inclusive of him. I'll never again touch anything Kodak if I can help it.

Michael miserable failureMoore

[Beck_isright]

Kodak took 10 years to figure this out? Join the trasheap gang. Fuji is not far behind.

[MediaMole]

It isn't very hard to develop 35mm film. Even color film needs nothing more than the right chemicals and a heater to control the temperatures. Automatic processors do exist, but they cost a couple thousand dollars.

The problem is that you have to mix your chemicals, heat them to the right temperature, load the film into a tank in the dark then develop the film, taking care to observe the 3:15 second developing time within 5 seconds, then bleach the film, fix the film, wash and stabilize the film. Then it must be dried.

Oh, the used chemistry can't be dumped. It first has to be processed to remove the residual silver from the silver halides in the film.

The happiest day of my professional life was when I got my first digital camera.

It is worth learning how to develop film, but it is a PITA.

[Psycho_Runner]

"Digital SLRs cost a small fortune. Older, auto-exposure film SLRs still do a great job and on a budget."

Dropping $1000 for the Canon Digital rebel was real expensive. Here is what I see for the future. firat of all I live in Silicon valley and so I am price sensitive on High tech gadgets, from memory to proceesing power.

Canon is currently capturing the Digital SLR market. By the time the other makers match the digial rebel, they will come out with even a higher Megapixel SLR. The other makers such as Nikon and Kodak will try to outdo the rebel by a slightly higher Pixel count but by then Canon will come out with a 11 megapixel camera for $1000. This should happen within three years.

It's real hard to imagine what is next for Digital SLR's, but one thing is for sure, Price will come down and Pixel count will go up. God bless this country.

[Johnny_Cipher]

Every time I look at my bread machine, I wonder why nobody has tried to build and market a film development device.

[avenir]

"No big loss. Kodak hasn't made a quality film camera since the Retina."

My grandparents had two of those, and I had a lot of fun with them. If I recall they had a Carl Zeiss lens.

[HAL9000]

Kodak is a very PC company. It is almost as bad as Disney. It doesn't deserve much goodwill. The only Kodak film Fuji doesn't match is Kodachrome, but color reversal film is getting less popular.

Sorry, I will never buy Fuji film while Kodak is still in business. Kodak is a 123-year old American company.

[HAL9000]

Buy American!

[zarf]

I seriously doubt digital camerals will match the resolution of 4"x5" or 8"x10" view cameras anytime soon.

That's what we said 5 years ago in the audio field.

At 24 bits +, it's gotten hard to tell the difference. In the hands of engineers with great ears, it's anyone's guess.

Digicams, in 10 yrs, will be indistiguishable from film.