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Kodak files for bankruptcy protection
15 February 2012
 
 
   
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Sad but true, Eastman Kodak, the legendary company best known for its wide range of photographic and motion film products filed for Chapter 11 bankruptcy protection on January 19th 2012, 123 years after its founding by George Eastman in 1889.

The history

Some of the (literally hundreds) scientific and technical achivements of Kodak include:
  • The first commercial transparent roll film in 1889.
  • The invention of the Brownie camera in 1900, the first simple and inexpensive camera that anyone could afford and use, leading to the popular slogan "You push the button, we do the rest."
  • The introduction of Kodachrome in 1935, the most widely used color reversal film stock of all time, legendary for its brilliant color reproduction (discontinued in 2009).
  • The development of the super 8 film format in 1965.
  • A shoe box-sized camera that was used by NASA to document the first astronauts to walk on the moon.
  • The invention of the world΄s first digital camera in 1975. The prototype was the size of a toaster and captured black-and-white images at a resolution of 10,000 pixels (0.01 megapixels).
  • The discovery of organic light-emitting diode technology, more commonly known as OLED.
  • The introduction of the world΄s first 50 million pixel CCD image sensor in 2008, offering unprecedented resolution and detail for scientific research and professional photography.

For a complete list of Kodak’s milestones and history check here
.

Kodak’s contribution to the art of cinema remains indisputable.
Eighty “Best Picture” Oscars have gone to movies shot on Kodak film, and the company itself has won nine Academy Awards fo r scientific and technical excellence.
The Kodak brand name and logo has become interwoven with the Oscars during the last ten years, with the awards being hosted in the “Kodak Theatre” (something that’s about to change...).

The problems

Beginning in the late 1990s, Kodak struggled financially as a result of the decline in sales of photographic film, and 2007 was the most recent year in which the company made a profit.

Despite its colossal economic success during the past century, Kodak failed to recognize the game-changing impact the digital technology would have on the film-making business. The switch to digital cinema by filmmakers (George Lucas, David Fincher, Peter Jackson, James Cameron, Martin Scorsese to name a few) and theater chains (35mm film as a distibution format is already considered dead in the U.S. market, with Europe following...) is estimated to have cost Kodak millions of dollars in the last few years.
“Since 1889, 35mm has been the principal film projection technology, however, after 10 years of market priming, movie theaters now are undergoing a rapid transition to digital technology, spurred initially by the rising popularity of 3D films,” said David Hancock, head of film research at IHS














The use of 35mm film as a projection format is rapidly reducing.


As of right now, Kodak owes a total of $6.75 billion to more than 100.000 creditors. With major Hollywood studios and technology  companies listed among them  like Sony, Warner Bros., NBC Universal, Paramount, Disney, Amazon and Nokia, who fear they will not be repaid.
At the same time, Kodak has around $5.1 billion in assets. Thus, even if they liquidated everything, they’d still be in a $1.75B hole. That’s what led to the company’s filing for bankruptcy protection from its creditors on January 19th.

Since 2003 Kodak has laid off 47.000 employees and closed 13 factories that produced film, paper and chemicals, along with 130 photo laboratories. These actions, including the filing for bankruptcy and future plans to sell “significant assets and patents”, were necessary steps towards the completion of the company’s restructuring and  transformation strategy.

The Future

As Kodak tries to preserve cash and restructure operations it announces (Feb 1st ) the desire to void an estimated $4 million-a-year contract and remove its name from the famous Kodak Theatre (that hosts the Oscars) in central Hollywood.
In addition to that, a second announcement (Feb 9th) reveals the company’s plans to phase out the unit that makes digital cameras, pocket video cameras and digital pictur e frames.
The company will seek to license its brand to other manufacturers as it exits cameras in the first half of 2012.
In the meantime, Kodak is trying to sell more than 1,100 digital imaging patents, and is pursuing device makers including Apple Inc. and Research In Motion Ltd. for patent infringements, claiming the companies owe it royalty payments.

Mr. Antonio Perez, Kodak’s current Chairman and CEO (Hewlett-Packard Co.’s former inkjet printers section chief) is planning in making Kodak a smaller and more flexible company that makes sophisticated printers for the publishing, packaging, and advertising businesses. Perez plans to increase Kodak’s share of the consumer inkjet printer market as well (which he has valued at $45 billion) by designing cheaper replacement cartridges. 

Perez’s critics say that “He’s betting on the wrong horse”...The printing market itself is expected to shrink significantly as the world embraces mobile devices such as tablets and smart phones, eschewing traditional hard-copy publications and paperwork.

So, how is this going to affect the cinema industry? 

Well, that remains to be answered...
For the time being Kodak has no plans to stop manufacturing film stock for motion pictures.
As long as there are big names in cinema, that are willing to use film to capture their vision for the silver screen, it’s going to continue to exist as an artistic choise for all filmmakers. Steven Spielberg, Quentin Tarantino (known for his passion about working with celluloid) and Christopher Nolan (resisted pressure to shoot his upcoming movie digitally in 3D) are such examples.
Spielberg was recently quoted saying “I’m still planning to shoot everything on film… I love film. I guess when the last lab goes out of business, we’ll all be forced to shoot digitally and that could be in eight-to-ten years. It’s possible in ten years’ time there will be no labs processing celluloid.”

Another matter of great importance to be considered is motion pictures preservation for future generations. Film is a medium that when stored in optimal conditions (easily achieved) remains unaltered for hundrends of years and can be easily reproduced by equipment that will always exist.
We still haven’t found an equally safe and economically sustainable way of archiving and preserving movies digitally. Codecs come and go every few years and digital technology advances rapidly, often leaving behind inoperable digital relics that once were the standard.

One thing is certain...
The way we watch movies in theaters is about to change, maybe even the way we shoot them, but not the way we archive them (yet).


George Tampakakis


 
 
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  Europe supports digitization of cinemas
 
 
 
 
 
  Kodak Official Site
  Kodak at Wikipedia
  Chapter 11 United States' Bankruptcy Code
  The Last Roll of Kodachrome Frame by Frame!
  IHS Home Page
  How film is made - Kodak 1958 (Part1)
  How film is made - Kodak 1958 (Part2)
  Quentin Tarantino on Digital vs Film
 
 
 
 
 
 
       
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