Kodak’s travails: Better heed the lesson, camera makers

Kodak logos through the decades.

Kodak logos through the decades.

(Credit: Eastman Kodak)

It’s sad but unsurprising that Kodak appears headed for bankruptcy protection. And that should be a cautionary tale for camera industry powers that might think themselves better off.

Kodak, a technology titan from an earlier industrial age, has been struggling financially for years as digital photography killed Kodak’s former cash cow, film. Bankruptcy protection, as reported yesterday in the Wall Street Journal, could open the door to some otherwise difficult options such as evading its pension obligations.

But fundamentally, it’s hard to see Kodak surviving except as a shadow of its former self. Some technology bright spots–digital cameras that emphasize social sharing, inkjet printers with cheaper ink, drugstore kiosks for quick photo printing–aren’t enough to sustain what was once a globally recognized brand.

The company has been eating the seed corn, too. It sold its high-end Leaf camera and software business to Phase One, sold its image-sensor design and manufacturing business to Platinum Equity in November, and is trying to raise cash by selling its digital imaging patent portfolio.

A third-quarter loss of $222 million showed the seriousness of the company’s problems. Because its stock has dropped below $1 for 30 days, the EK ticker symbol could be ignominiously booted from the New York Stock Exchange.

It’s surely easy for those at better-situated companies to feel a combination of pity and scorn for Kodak. But I’d suggest they should also feel some worry.

That’s because the microprocessor is nowhere near done remaking the photography industry. There’s plenty more room for creative destruction, the incessant overhaul of businesses that’s often unpleasant for those trampled by change.

Several big changes that threaten even powerful incumbents:

Lytro's first light-field camera is rough around the edges, but its technology could be disruptive.Lytro’s first light-field camera is rough around the edges, but its technology could be disruptive.

(Credit: Lytro)

• Developments in image sensors, lenses, and image processing means that mobile phones are ever more useful as cameras. That means phones will gradually replace dedicated cameras, especially point-and-shoots. The iPhone 4 and 4S are signal examples; the former tops Flickr’s camera usage chart.

• Developments in smartphones and wireless networking have freed digital photos from the flash cards and hard drives. People now share their photos instantly from phones, gussying the photos up with software such as Instagram and using sites such as Facebook that capitalize on the fact that many photos are essentially a form of communication. In comparison, the relatively few cameras with networking abilities usually have only Wi-Fi that can’t compete with mobile phone network coverage.

• Compact interchangeable-lens cameras (ILCs) that lack the internal mirror of traditional SLR cameras are steadily improving and could eat into digital SLR sales. Trey Ratcliff, a photographer who uses a Nikon D3X SLR that costs north of $7,000 even without any lenses, just declared SLRs to be “a dying breed.” That’s probably a bit strong, especially given the current shortcomings and high prices of this new breed of camera, but they do appear destined for success. And electronics companies such as Panasonic and Sony that seemed to find SLRs an awkward market to crack seem much more at home with these more electronic devices.

• More and more of what happens with a photo takes place after the image sensor does the first work. Software and Web sites for editing, cataloging, printing, and sharing photos are increasingly important, and people pay a lot of money for that technology. Camera makers are at best laggards in these areas of photography.

• In the longer run, more radical changes such as Lytro’s light-field camera could rewrite camera rules even more dramatically by moving away from optical engineering of lens design to the software engineering of computational photography. Lytro has plenty of challenges, but image processing to correct lens problems such as barrel distortion is already a reality, and image processing power will progress faster than lens design.

There are plenty of other changes afoot, too–high-speed cameras, 3D cameras, new image sensor designs. Cameras are spreading farther afield, too, with videoconferencing and video chat becoming downright ordinary, cars using them for making it easier to reverse, industrial robots relying on them in manufacturing, and face recognition being used to unlock Google’s latest Android phone.

The speed of technological change makes the challenge particularly acute. Yesterday’s technology innovator–Research In Motion and Yahoo, for example–can quickly become today’s also-ran when somebody comes up with a new recipe for technology success. Even those with a strong business–Microsoft and Intel, for example–struggle to adjust to changes such as those Apple is spurring with the iPhone and iPad.

Canon's C300, a videocamera that stems from the company's SLR heritage, has sent ripples through the cinema world.Canon’s C300, a videocamera that stems from the company’s SLR heritage, has sent ripples through the cinema world.

(Credit: Canon USA)

Camera makers are certainly not complacent. For example, the giant of the industry, Canon, successfully carved a new video niche in cinema circles after introducing its 5D Mark II SLR more than three years ago. And it’s following up with theC300, a cine-specific videocamera, that has some potential to disrupt the status quo with features such as low-light performance and compatibility with the tremendous variety of relatively inexpensive SLR lenses.

And the other traditional camera makers besides Canon have adopted mirrorless ILCs, evidently concluding that they’d rather cannibalize their own SLR sales than let another company get the revenue. (Given the price of these compact models, I wouldn’t be surprised if they’re more profitable–they have fewer components, though doubtless they’re absorbing more than their fare share of marketing and R&D expenses.)

I believe there will always be a market for dedicated camera market for enthusiasts such as myself who prefer image quality over a cell phone camera’s convenience or an ILC’s compactness.

How big a market that is, though, is uncertain, especially as newer cameras’ drawbacks in image quality, autofocus performance, and price gradually recede. And I expect it won’t be where much of the growth is taking place.

Thus, I’m not at all sanguine that Kodak will be the last casualty of the digital photography revolution.


Facebook, Nielsen to devs: Smartphones are your future.

Facebook’s Doug Purdy pitches the revised Facebook Platform for Mobile.

SAN FRANCISCO–The U.S. is becoming a smartphone nation.

Today at the AppNation conference here, Doug Purdy, Facebook’s director of developer relations, reminded the developers in the audience of the existence of the recently updated Facebook Platform for Mobile. Then, to emphasize the imperative for developers to focus on the mobile platform, he was followed by Jonathan Carson of Nielsen, who rolled out adoption figures that made it clear that the action in development has definitively moved to the mobile space.

Facebook: We’re serious about mobile
While Facebook announced a platform for mobile in 2007 (see this blog post by Dave Morin, now CEO at Pathstory), the update, according to Purdy, will make it easier for developers to get mobile apps in front of the 800 million Facebook users. Purdy said that 500 million of them use apps, 200 million use games, and that there are 20 million new apps installed every day.

Facebook is capturing the movement toward mobile, Purdy said, with enhanced capabilities in the mobile platform. “The most social thing you have is your phone,” he said, and 350 million Facebook users are on the service from a mobile device. They are, he said, twice as likely to “re-engage” with apps, and become “high-engagement users.”

The updated mobile platform will let users find mobile apps and will automatically bookmark apps that users add on all their platforms: the mobile apps and the traditional sites. “Write an app and you are instantly inside the platform,” he said.

The platform, not surprisingly, encourages users to share apps with other users, but there is a revised security step before apps are added that lets users approve the permissions that the app is asking for in more granularity. It’s not clear what will happen if you approve some private data requests and decline others, but this is a good move, since it means that accepting an app that a friend recommends is no longer an all-or-nothing decision when it comes to exposing your Facebook data.

Facebook mobile apps can be all in HTML5 or can be written in a mobile device’s native environment. “It’s not a question of ‘or,’” he said, “It’s ‘and.’”

Purdy closed his mobile pitch for developers with this: “Your app goes from being something that people use to something that is part of who they are.”

Nielsen’s Jonathan Carson: Smartphones are being used for apps more than calls.

Nielsen: The emerging smartphone majority
Jonathan Carson, GM Digital at Nielsen, drove the importance of developing for mobile home after Purdy left the stage. His first data point: 44 percent of U.S. consumers carry smartphones, and we will soon have a majority of consumers on smartphones. Fifty-six percent of mobile handsets sold, he said, are smartphones. Trends in all other countries are similar.

And people using smartphones are actually using them to do what they were designed for. Using an (opt-in) scanning technology that some Androidusers have installed, Nielsen has determined that only 6 percent of use on Android devices is in the phone “dialer.” Nine percent is in the browser, 14 percent is in SMS. The rest, over half of use, is in apps.

And there is opportunity in the app space still. While on Android, five out of six of the top apps are Google’s (the other is Facebook), and while half of the app use on Android devices is in the top 50 apps, the relative positions on that leaderboard are dynamic.

Carson said that fewer than half the apps stay within 3 places of their position month to month, and that apps enter and leave the top 50 board frequently.

Compared to the top TV shows or Web sites (which Nielsen also tracks), there’s just a lot more change in the popularity of top products. The space is a big opportunity.

Nielsen also tracks when people use apps, and notes that “prime time” on smartphones is all day long. “This is a really big deal,” Carson said. App usage peaks in the late morning and stays high all through the evening. It’s quite unlike TV, and represents a wide open space for developers, content providers, advertisers, and anyone tapped into the mobile economy.

Microsoft improves SkyDrive’s sharing and file management.

Microsoft has beefed up SkyDrive with better file management and other improvements.

Microsoft has beefed up SkyDrive with better file management and other improvements.

Microsoft SkyDrive users will find some much-needed enhancements the next time they log onto the cloud-based storage site.

As part of an ongoing effort to improve SkyDrive, Microsoft yesterday revealed a series of tweaks designed to make the site more efficient and user-friendly. Described in a blog posted yesterday and seen in the video below, the changes focus mostly on sharing and file management.

Admitting that sharing folders and files on SkyDrive has been difficult and unreliable in the past, Microsoft has simplified the ability to share. Instead of setting up specific folders for sharing, you can now share individual files. Right-clicking on a file opens a popup menu where you can select the Share command. You can also share a file from a menu that appears when you open that file in your browser.

For example, clicking on a Word document opens it in your browser via Microsoft’s Word Web App. From there, a Share command appears as one of the menu options. This process also works for images, PDFs, and a variety of other file types.

Sharing a file lets you send its link to other people. But SkyDrive also now lets you share or upload files to Facebook and LinkedIn where you can reach a variety of friends and contacts in one shot.

Managing your SkyDrive files is also now much easier. You can name a new or existing folder inline, meaning that a text box appears for you to enter the name, just like in Windows Explorer. And by displaying your content in a Details view, you can select multiple files and then move, delete, or download them all together.

Best of all, you can now right-click on any file and choose from a variety of commands, such as Open, Download, Move, Copy, and Delete. If you right-click on a Microsoft Officedocument, you can also opt to open the file in either its Office Web App version or in its local version. For example, you can view an Excel spreadsheet either in the browser through the Excel Web App or in your local copy of Excel.

Microsoft has kicked in several other enhancements, including support for more file types and a cleaner slideshow view for your photos.

The changes in SkyDrive are helpful and much needed, and I applaud Microsoft for its efforts. But one major improvement I’m still waiting for is better support for synced folders and files. One of the ways I use SkyDrive is to synchronize certain documents and files from my PCs to the cloud. Through Windows Live Mesh, specific folders and files are automatically backed up to SkyDrive on a regular basis.

But for some reason, Microsoft treats synced files differently than files you upload directly into SkyDrive. You can’t manage your synced files online. Clicking on a synced file gives you only two options–either download it or open it through its associated application. And none of the enhancements rolled out yesterday affect synced folders or files.

Even moving back and forth between your uploaded files and your synced files is extremely clumsy. I know Microsoft has other tricks up its sleeve for SkyDrive. I just hope that a more user-friendly approach to synced folders is one of them.

© * WELCOME * ©

The family.  We were a strange little band of characters trudging through life sharing diseases and toothpaste, coveting one another’s desserts, hiding shampoo, borrowing money, locking each other out of our rooms, inflicting pain and kissing to heal it in the same instant, loving, laughing, defending, and trying to figure out the common thread that bound us all together.

Family quarrels have a total bitterness unmatched by others.  Yet it sometimes happens that they also have a kind of tang, a pleasantness beneath the unpleasantness, based on the tacit understanding that this is not for keeps; that any limb you climb out on will still be there later for you to climb back.

Family quarrels are bitter things.  They don’t go by any rules.  They’re not like aches or wounds; they’re more like splits in the skin that won’t heal because there’s not enough material.

Our most basic instinct is not for survival but for family.  Most of us would give our own life for the survival of a family member, yet we lead our daily life too often as if we take our family for granted.

They… threw themselves into the interests of the rest, but each plowed his or her own furrow.  Their thoughts, their little passions and hopes and desires, all ran along separate lines.  Family life is like this – animated, but collateral.

The lack of emotional security of our American young people is due, I believe, to their isolation from the larger family unit.  No two people – no mere father and mother – as I have often said, are enough to provide emotional security for a child.  He needs to feel himself one in a world of kinfolk, persons of variety in age and temperament, and yet allied to himself by an indissoluble bond which he cannot break if he could, for nature has welded him into it before he was born.