Eastman Kodak Files For Bankruptcy After Years Of Falling Sales

Jan 19 (Reuters) - Eastman Kodak Co filed for bankruptcy on Thursday in a bid to survive a liquidity crisis after years of falling sales related to the decline of its namesake film business.

The once-iconic photographic film pioneer, which had tried to restructure to become a seller of consumer products like cameras, said it had also obtained a $950 million, 18-month credit facility from Citigroup to keep it going.

"The board of directors and the entire senior management team unanimously believe that this is a necessary step and the right thing to do for the future of Kodak," Chairman and Chief Executive Antonio M. Perez said in a statement.

Kodak said that it and its U.S. subsidiaries had filed for Chapter 11 business reorganization in the U.S. Bankruptcy Court for the Southern District of New York. Non-U.S. subsidiaries were not covered by the filing, it added.

Comments

[elfish]

05:38 PM on 01/21/2012

The interns should start lining up outside his office right away.

[elfish]

05:38 PM on 01/21/2012

He's going to need a new Wife.

[elfish]

05:38 PM on 01/21/2012

If Newt is going to be president,

[Peter Pappas]

08:52 PM on 01/20/2012

This week Eastman Kodak filed for bankruptcy. Is there a lesson for educators about what happens when you lose touch with your customer?

At the core of Kodak's eventual demise was the failure of the leadership to remain connected to their customers. They convinced themselves that the public would continue to want to buy film, load it into the camera, take a picture, drop the film off at the processor, and return later to pick up their photos. Easy to believe when you're making money at every stage of that process.

Has our educational leadership lost touch with their customers - the students? Given the growing array of cheap digital tools available to our students, will they passively wait to be told what, how, when and with whom to learn? Is the information flow of the traditional classroom (lecture, note-taking, test) as outmoded as taking your film to the drugstore for processing?

Read more at my post "Worksheets and Kodachrome: Lessons for Educators in the Kodak Bankruptcy" http://bit.ly/ACvPIS

[Blackspeare]

11:07 AM on 01/20/2012

Serves them right. I don't know whether you people remember, but in the early 1980's the Hunt brothers were trying to corner the market on silver and the price of silver skyrocketed practically overnight. Naturally, since silver is used in the production of photographic film, the price of a roll of film just about tripled. Eventually, the price of silver returned to normal, but the price of a roll of film didn't drop very much and Eastman Kodak, as well as other made windfall profits, but I blame Kodak because they were the leaders.

[Mailman]

08:11 AM on 01/20/2012

Just a sign of the times and they are not alone. Sears is right around the corner.

[moogyboy]

11:51 PM on 01/19/2012

Another point I thought of just now while walking the dogs. One contributing problem is that Kodak has never been able to shake the image of their cameras being designed and made for dummies. They built their entire empire on the paternalistic, somewhat condescending attitude embodied in their early slogan: "You push the button, we do the rest"; ie, the average picture-taking consumer was too stupid to manage anything more complex than a Brownie or Instamatic. That worked for a long time. Today's consumers are more sophisticated, or at least we like to pretend that we are--even if we never do more than "push the button" on our digital point-and-shoot cams, we like to brag about megapixels and gigabytes and how-many-times zoom. Japanese camera makers picked up on that; just look at the confident, hip names they give to their consumer digicam lines. Nikon CoolPix. Fujifilm FinePix. Canon PowerShot. Olympus Stylus.

Kodak's digicam line? Easyshare.

Assuming a camera is an extension of one's personality, who would want a camera with such a homely, marshmallowy, wimpy name?

[Cedar-pine]

08:00 AM on 01/20/2012

I don't think their slogan's were at all condescending in the past, I think they were meant to represent a modern convenience that was suitable for that era. I do agree about the Easyshare being rather poor and off the mark, and that's a good observation. When I see all the names compared together as you have above, I notice they really cater to ego quite a bit, and maybe that speaks to where the consumer is at right now. Something more in touch, fresh and progressive for the transition into the digital world was needed. When I reached for Kodak, it was because of quality. I am sad to hear the news. I've posted some of their slogans and envelope images.
http://cedarpineword.wordpress.com/2012/01/20/kodak-moments-to-be-history/

[1View]

07:04 PM on 01/19/2012

As the consumer base dwindles , the corporations will begin to go bankrupt . The feeding trough is empty , the profit margins are dieing , the ceo's have destroyed the employee base that intern supplys the corporate base with consumer buying power . When the board members start falling from windows , there maybe a realization that the employee's are the driving force of capitolism . That solid wages fills the trough, that survival of corporate america lies in the hands of the middle class . At least if they do die, smaller businesses will replace them with jobs, service and competition .

[john6118]

09:36 PM on 01/19/2012

Nah, wrong. Nikon does okay... consumer base still exists. Kodak failed to execute. They lose. Furthermore, small business wont replace them. Don't expect main street to solve these problems. We know now to let unproductive companies die. Kodak died years ago, i wish more that this, along with other similar situations, were recognized sooner.

[Try the truth]

06:34 PM on 01/19/2012

For those on both sides trying to place blame on the President or even Bush! Stop it and blame yourselves AND Kodak! You bought Fuji or something else, they didn't keep up!

[dsa1115]

05:02 PM on 01/19/2012

They say a picture is worth a thousand words. Obviously Kodak didn't get the picture.

[Ari B Canaan]

04:30 PM on 01/19/2012

Message to Kodak: Despite your recent errors, we all want you to survive. Whether in digital or film, you are the center, and the icon of American photography, its art and its history. Please stick around.

[Eyeful]

04:00 PM on 01/19/2012

They invented Safety Film. Their core competency is with manufacturing and developing film. Film is practically a dead medium. Any questions?

[Ari B Canaan]

04:29 PM on 01/19/2012

Yeah. One question: Why are you so shortsighted about photographic media?

[john6118]

09:38 PM on 01/19/2012

Niche market, important, and significant yes, but a consumer driven powerhouse they will not be with this focus.

[Whatdoyou thinkof this]

04:00 PM on 01/19/2012

OWS people... one down... how many more are you going to celebrate while they close the doors. This company is an icon that transformed photographic imaging and made it accessible to the general public and also pioneered medical imaging. Where would the world be without these innovations.

[Try the truth]

05:35 PM on 01/19/2012

What does OWS have to do with this? We here in Rochester NY saw it coming for years! Kodak refused to keep up!

[pappyvet]

03:22 PM on 01/19/2012

Whatever the reason , it is a melancholy moment for those of us who grew up with them.
So let me repost,

“Kodachrome
You give us those nice bright colors
You give us the greens of summers
Makes you think all the world's a sunny day, oh yeah!
I got a Nikon camera
I love to take a photograph
So Mama, don't take my Kodachrome away

goodbye old friend

[Linda from Deerfield]

02:38 PM on 01/19/2012

I remember when Motorola's very successful CEO, George Fisher, was miffed that he was not being better rewarded and quit to run Kodak -- he was going to save them by bringing them into the modern electronic world. He was not very successful. For one thing, I think he underestimated the challenge and overestimated his own individual contribution to the company he left, although that was the beginning of a long slide for Motorola, too. Oh, heck, it's always a more complex story than we might wish.

I cling to one positive tale that I read about, though -- that a closed film factory and idle equipment have been revamped to make solar film, and some of the same employees were hired.

[cireneed]

04:03 PM on 01/19/2012

My wife and I worked at Kodak for 26 years. George Fisher came to town, and his presence alone was basically enough to send the stock higher. He did nothing of value, cashed out all his options at the new higher value and bailed. This company has been mis-managed for over thirty years as potential future targeted product lines were ignored in favor of the quick buck stuff. The real tragedy is the approximately 70,000 who have gotten screwed over the past decades while management did just fine. (BTW: Kodak NEVER had a union in 130 years of existence, so, gee, it must have been some other reason....actually dozens)

[Try the truth]

06:35 PM on 01/19/2012

Thank you !

[Linda from Deerfield]

07:17 PM on 01/19/2012

Good to meet you, and thanks for that tale. I worked for Motorola for 23 years and feel much the same. No unions, ever. Great place to work until around 2001-2003, when the analysts and the board conspired to block the technically astute from upper management -- my opinion of the source of the damage, of course. Motorola has perhaps not fallen as far, but I and many others were pressed (forced, actually) to retire early (with a decent severance, but later departures were not so fortunate). I took the opportunity to roll out my long frozen, meager pension into a lump sum IRA. I may not be able to generate as good a return, but I did not want to gamble on the company and pension remaining viable for my lifetime. I feel much more secure. All the best.