Kodak

Eastman Kodak Company

Eastman Kodak Company logo
Company type	Public NYSE: EK
Industrie	Photographic & Optical Equipment/Supplies Manufacturers
Gegründet	1892
Hauptsitz	Rochester, New York, USA
Key people	Antonio M. Perez, Chairman & CEO Frank S. Sklarsky, EVP & CFO George Eastman, Founder
Revenue	$13.274 Billion USD (2006)
Net income	$601 Million USD (2006)
Number of employees	51,100 (2005)
Website	www.kodak.com

Eastman Kodak Company (NYSE: EK) is an American multinational public company producing photographic materials and equipment. Long known for its wide range of photographic film products, Kodak has focused in recent years on three main businesses: digital photography, health imaging, and printing.

Origins

Eastman Kodak's origins rest with Eastman Dry Plate Company, founded by inventor George Eastman and businessman Henry Strong in 1881. The Eastman Dry Plate Company was responsible for the first cameras suitable for nonexpert use. The Kodak company attained its name from the first simple roll film cameras produced by Eastman Dry Plate Company, known as the "Kodak" in its product line, this in turn got its name from George Eastman who registered the trademark Kodak on September 4, 1888. The letter "K" had been a favorite of Eastman's, he is quoted in saying, "it seems a strong, incisive sort of letter".

He and his mother devised the name Kodak with an anagram set. He said that there were three principal concepts he used in creating the name : it must be short, you can not mispronounce it, and it could not resemble anything or be associated with anything but Kodak.

Cameras

The Kodak company remains the largest supplier of films in the world, both for the amateur and professional markets. It has also diversified into various other imaging-related industries (such as medical imaging), and continues to work at gaining a stronger foothold in the fields of digital photography and imagery. The camera proved such an enormous success that the word Kodak was incorporated into the company name.

Film Cameras

Kodak has introduced many film formats throughout its history and many became widespread within the industry. On January 13, 2004, Kodak announced it would stop producing traditional film cameras (excluding one-time-use cameras) in the United States, Canada and Western Europe. Kodak announced it would continue to introduce traditional film products in developing markets. By the end of 2005, Kodak ceased manufacturing cameras that used the Advanced Photo System. Kodak licensed the manufacture of Kodak branded cameras to Vivitar for two years following (2005-2006). In 2007 it appears that Kodak is not licensing any manufacture of any film camera with the Kodak name in this market. These changes reflect Kodak's focus on growth in the digital markets. Kodak continues to produce film for newer and more popular formats, while it has also discontinued the manufacture of film in older and less popular formats.

Instant Cameras

After losing a patent battle with Polaroid, Kodak left the instant camera business on January 9, 1986. The Kodak instant camera used different technologies than those used by Polaroid, but the legal loss was attributed to the general idea of technology. Kodak had been the exclusive supplier of negatives for Polaroid cameras from 1963 until 1969, when Polaroid chose to manufacture its own instant film. In the same period (1963-1970), Kodak shipped 50 million Instamatic cameras (introduced in 1963).

Digital Cameras

Many of Kodak's earlier digital cameras were designed and built by Chinon Industries Chinon, a Japanese camera manufacturer. In 2004, Kodak Japan acquired Chinon and many of their engineers and designers joined Kodak Japan. In July, 2006, Kodak announced that Flextronics would manufacture and help design their digital cameras.

As part of its move toward higher end products, Kodak announced in September 15, 2006 that the new Leica M8 camera from Germany manufacturer will incorporate Kodak's KAF-10500 image sensor. This is the second recent partnership between the two companies.

In an effort to reduce costs, Kodak accompanied its shift toward digital products with a series of layoffs and facility closures, cutting 12,000-15,000 jobs around the world, a 20-25 percent reduction in its workforce. Kodak owns the Visual Effects Film Post Production Facilities "Cinesite" in L.A. and London as well as LaserPacific, a post-production facility in Hollywood. Kodak also owns Pro-Tek Media Preservation Services in Burbank, CA. Pro-Tek is the world's premier film storage

Kodak Printers and Printer Cartridges

Kodak entered into printers (specifically photo printers) in 2002, but did not put the printer business at the core of its business model until 2007 March. In February 2007, Kodak has announced a range of new Kodak All-In-One Inkjet printers which promise to provide cheaper home printing with pigment based inks and special paper. According to a Feb 2007 Businessweek article, Kodak is planning to spend upwards of US$ 300 million to launch its new Kodak Inkjet Printer series. It is probably important to note here that Kodak CEO Antonio Perez left HP seven years ago. Here are the new Kodak Printers that the Eastman Kodak Company is betting on to bring success (and revenue) to the company in 2007:

• The KODAK EASYSHARE 5100 All-in-One Printer
• The KODAK EASYSHARE 5300 All-in-One Printer
• The KODAK EASYSHARE 5500 All-in-One Printer

Better Business Bureau expulsion proceedings

On 26 March, 2007, the Council of Better Business Bureaus (CBBB) announced that Eastman Kodak had advised it that the company was resigning its national membership in the wake of expulsion proceedings initiated by the CBBB Board of Directors. In 2006, Kodak had notified the BBB of Upstate New York that it would no longer accept or respond to consumer complaints submitted by them. In prior years, Kodak had responded by offering consumers an adjustment or an explanation of the company’s position. The BBB file contains consumer complaints of problems with repairs of Kodak digital cameras, as well as difficulty communicating with Kodak customer service. Among other complaints, consumers say that their cameras broke and they were charged for repairs when the failure was not the result of any damage or abuse. Some say their cameras failed again after being repaired.

Kodak said its customer service and customer privacy teams concluded that 99 percent of all complaints forwarded by the BBB already had been handled directly with the customer. Brian O’Connor, Kodak chief privacy officer, said the company was surprised by the news release distributed by the Better Business Bureau:

"It is inaccurate in the facts presented as well as those the BBB chose to omit. Ironically, we ultimately decided to resign our membership because we were extremely unhappy with the customer service we received from the local office of the BBB. After years of unproductive discussions with the local office regarding their Web site postings about Kodak, which in our view were consistently inaccurate, we came to the conclusion that their process added no value to our own. Our commitment to our customers is unwavering. That will not change. What has changed is that, for us, the BBB’s customer complaint process has become redundant, given the multiple and immediate ways that customers have to address their concerns directly with Kodak." --Rochester Business Journal, March 26, 2007

Inventions

2006

Kodak EasyShare V570 Dual Lens Digital Camera: The world's first dual-lens digital still camera was unveiled at the January 2006 CES. It was also the world’s smallest ultra-wide-angle optical zoom digital camera. Using proprietary Kodak Retina Dual Lens technology, the V570 wrapped an ultra-wide angle lens (23 mm) and a second optical zoom lens (39 – 117 mm) into a body less than an inch thick.

Kodak EasyShare V610 Dual Lens Digital Camera: The world’s smallest 10X (38 – 380 mm) optical zoom camera at less than an inch thick.

2005

Kodak EasyShare-One Digital Camera: The world’s first Wi-Fi consumer digital camera, and the world's first camera that could e-mail pictures was unveiled at the January 2005 CES

2003

Kodak EasyShare LS633 Digital Camera: The world's first digital camera to feature a full-color, active-matrix organic light-emitting diode (OLED) display. The display measured 2.2 inches and had a 165º viewing angle. OLED technology was developed by Kodak. The retail price was $399 USD.

Kodak EasyShare Printer Dock 6000: The world's first printer-and-camera dock combination, enabling users to print borderless 4 x 6 inch laminated, waterproof, photos directly from their EasyShare digital camera with no computer required in 90 seconds. The printer dock could also charge the camera's battery or be connected to a computer to offer one-touch picture transfer. The printer dock used thermal dye-sub technology (a paper-and-ribbon system) that provided continuous tone color ink that dried instantly. The retail price was $199 USD.

1987

Dr. Ching Tang, a senior research associate, and his colleague, Steven Van Slyke, developed the first multi-layer OLEDs at the Kodak Research Laboratories. Dr. Tang is considered the inventor of OLED. He is a Fellow of the American Physical Society and was named a Fellow of the Society for Information Display (SID) for his pioneering work in the discovery, development, and sustaining of OLED technology. OLED displays comprise self-luminous pixels, which are thinner, clearer, and do not require power-consuming backlights as compared to LCD displays.

1986

Kodak scientists invented the world's first megapixel sensor, capable of recording 1.4 million pixels, capable of producing a photo-quality 5x7 inch print.

1976

The Bayer Pattern color filter array was invented by Eastman Kodak researcher Bryce Bayer. This CFA, the order in which dyes are placed on an image sensor photosite, is still in wide use today.

1975

The digital camera was invented by Steven Sasson, an electrical engineer at Eastman Kodak.

1888

George Eastman received a patent for his hand-held camera which used roll film. At this time he registered the trademark Kodak and coined the phrase "You Press The Button and We Do The Rest."

1885

George Eastman, founder of Eastman Kodak, invented roll film, which brought photography to everybody. Roll film was the basis for the invention of motion picture film, used by early filmmakers such as Thomas Edison.

Acquisitions

2005

Kodak announced agreement to acquire Creo Inc., the leading supplier of prepress systems used by commercial printers worldwide. Based in Burnaby, British Columbia, Canada, Creo was the world's foremost provider of workflow software used by printers to manage efficiently the movement of text, graphics and images from the computer screen to the printing press. Creo's key strengths were in imaging, software, and digital printing plate technology, with a range of technology solutions aimed at commercial, publication, on demand, packaging, newspaper printers, and creative professionals. Creo product lines included software and hardware for computer-to-plate imaging, systems for digital photography, scanning, and proofing, as well as printing plates and proofing media. Creo also supplied on-press imaging technology, components for digital presses, color servers and high-speed digital printers. Creo had more than 25,000 customers and offices in 30 countries worldwide.

Kodak announced on April 5 that it completed its acquisition of Kodak Polychrome Graphics (KPG) through redemption of Sun Chemical Corporation's 50% interest in the joint venture. KPG is now part of Kodak's graphic communications group. Kodak purchased KPG for $817 million.

2004

Kodak announced agreement to acquire two lines of business from Heidelberger Druckmaschinen AG, the world's largest maker of offset printing machines. Kodak purchased Heidelberg's 50% interest in NexPress Solutions L.L.C., a 50/50 joint venture of Kodak and Heidelberg that made digital color printing systems, and the equity of Heidelberg Digital L.L.C., a leading maker of digital black-and-white printing systems. Kodak also announced agreement to acquire NexPress GmbH, Heidelberg's German subsidiary, and certain inventory and assets held by Heidelberg's regional operations, or market centers, as well as offer employment to sales and service employees currently with Heidelberg's market centers. NexPress and Heidelberg Digital were leading suppliers of high-end, on-demand color printing systems and black-and-white variable-data printing systems, respectively. NexPress had installed more than 300 NexPress 2100 digital presses throughout the world, making it a leader in high-end, on-demand color printing. Heidelberg Digital had 4,000 Digimaster black and white systems installed worldwide, serving a variety of customer applications. Combined, the businesses acquired employed approximately 2,000 people. Kodak planned to locate the combined headquarters at Heidelberg Digital's Manitou Road facilities in Rochester.

Kodak announced agreement to acquire the Imaging business of National Semiconductor Corp. based in Santa Clara, California, which developed and manufactured complimentary metal oxide semiconductor image sensor (CIS) devices. The acquired assets, including intellectual property and equipment, and 50 employees who supported National's Imaging business became part of Kodak's Image Sensor Solutions organization, which designs and manufactures image sensors for professional and industrial imaging markets. Through this acquisition, Kodak added additional resources and technologies (including advanced mixed-signal circuit design) to strengthen their ability to design next generation CIS devices that promise improved image quality with complex on-chip image processing circuitry. This move was intended to accelerate Kodak's longer term goal of providing CIS devices that offer the image quality of CCD sensors while still taking advantage of the power, integration and cost benefits traditionally associated with CMOS technology. Kodak opened a new office for the Image Sensor Solutions organization in Sunnyvale, CA.

2003

Kodak announced agreement to acquire Applied Science Fiction Technologies with operations in Austin, Texas (now referred to as Kodak Austin Development Center). Applied Science Fiction, formed in 1995, was the creator of Digital ICE and Digital ICE3 technologies, a leader in automatic photo restoration applications, and the inventor of the digital dry film processing system: Digital PIC. Digital PIC in minutes would develop standard color negative film without chemical mixing or plumbing. The process would simultaneously render a digital image file used to print photographs or write images on a CD. Kodak intended to integrate these technologies into its Photo Kiosks.

Kodak announced agreement to acquire Scitex Digital Printing, the world leader in ultra-high-speed, variable data inkjet printing systems, from Scitex Corporation Ltd. Based in Dayton, Ohio, Scitex Digital Printing was the leading supplier of high-speed, continuous inkjet printing systems, primarily serving the commercial and transactional printing sectors. Scitex Digital Printing's product included the monochrome, spot and full-color VersaMark page printing systems and the Dijit family of narrow-format printers. These systems are used primarily to print utility bills, banking and credit card statements, direct mail marketing materials, as well as invoices, financial statements and other transactional documents. The company employed 733 people. The acquisition of Scitex provided Kodak with additional capabilities in the transactional printing and direct mail sectors, as well as an industry-leading patent portfolio for continuous inkjet printing technology. Scitex Digital Printing had over 9,000 system installations worldwide in a variety of applications ranging from addressing, personalization and variable messaging, to direct mail and bill and statement printing. Kodak renamed the company Kodak Versamark, Inc.

Kodak announced agreement to acquire Laser-Pacific Media Corporation, a leading Hollywood-based post-production company. Laser-Pacific operates as a wholly owned subsidiary of Kodak, reporting to the company’s Entertainment Imaging products and services operation. Founded in 1990, Laser-Pacific is well recognized in the Hollywood entertainment community. A winner of six Emmy awards for outstanding achievement in engineering development, Laser-Pacific provides post-production services for television, home video and motion pictures. These services include high-quality film processing, state-of-the-art film transfer, editing, mastering, digital preview services, and DVD compression and authoring. The acquisition allowed Kodak to establish a major presence in television post-production and further extend the company’s current digital services capabilities in the feature film market.

2001

Kodak announced the completion of the acquisition of Emeryville, California-based, Ofoto, Inc., a leading online photography service. Ofoto was to operate as a wholly owned subsidiary of Kodak, and served to complement Kodak's existing infrastructure and Internet photography services. Financial terms of the acquisition were not disclosed. Founded in 1999, Ofoto had 1.2 million registered members. The company employed 121 people. Kodak indicated that no layoffs were planned at Ofoto. Kodak said they planned to use Ofoto mainly to make prints of the digital images uploaded by consumers or with the help of retail photofinishing partners. With 18 million members, Ofoto announced in 2005 that the service would change its name to Kodak EasyShare Gallery.

Kodak announced it would acquire ENCAD, Inc., a San Diego manufacturer of wide-format inkjet printers, for approximately $25 million on November 15. The aquisition was finalized January 24, 2002 and ENCAD became a wholly-owned subsidiary of Kodak. The acquisition made Kodak one of the top three sellers of wide-format inkjet products in the commercial inkjet market. The transaction was expected to contribute to earnings beginning in 2003. The acquisition leveraged Kodak's core capabilities in inks and media, and opened markets ranging from retail point-of-sale to office decor.

Partnerships

2006

Motorola, Inc. and Kodak announced a 10-year global product, cross licensing and marketing alliance intended to fulfill the promise of mobile imaging for the benefit of consumers. By incorporating Kodak’s image science and system integration expertise with Motorola's mobile device design, the two companies goal is to greatly improve the ease-of-use and image capture experience of camera phones. The collaboration covers licensing, sourcing, software integration, marketing, and extends to co-development of image-rich devices with joint engineering teams. For example, Kodak expects to supply its CMOS sensors to Motorola for use in its camera phones, as well as in any future devices the companies co-develop. Additionally, the cooperation to seamlessly integrate millions of Motorola mobile devices with Kodak home printers, retail kiosks, and the Kodak EasyShare Gallery will provide a solution to consumers who want a quick and easy way to get their images out of the phone for sharing. Under the alliance, Motorola and Kodak plan to initially expand access to and awareness of mobile-imaging services – including retail programs, online services and customized operator-led initiatives that deliver a seamless, easy experience for consumers. Later plans are to launch handsets and co-created mobile devices with integrated software to enable consumers to access and manage their mobile images seamlessly and conveniently. This cross-licensing agreement between Kodak and Motorola delivers royalty revenues to Kodak.

Kodak announced a partnership with Martha Stewart Living Omnimedia, Inc. for a line of custom, personalized photo products. The products are intended to blend Martha Stewart’s "how-to" style with Kodak’s photo quality expertise, combining online photography with offline products. The photo products include individualized Photo Books, stationery, stickers, and cards, customized for holidays, weddings, and thank-you notes. The products were available by the end of the year and found on www.kodakgallery.com and www.marthastewart.com.

Agreements

2006

Kodak announced an agreement August 1 in which Flextronics International Ltd. would manufacture and distribute Kodak consumer digital cameras and manage certain camera design and development functions. Flextronics would also manage the operations and logistics services for Kodak’s digital still cameras. Kodak continues to develop the high-level system design, product look and feel and user experience, and conducts advanced research and development for its digital still cameras.

Under the agreement, Kodak divested its entire digital camera manufacturing operations to Flextronics; assembly, production, and testing. Flextronics thus acquired a significant portion of the Kodak Digital Product Center, Japan, Ltd. (“KDPC”) in Chino and Yokohama, Japan, (camera design functions and employees) and Kodak Electronics Products, Shanghai Co. Ltd. (“KEPS”) in China (camera manufacturing, assembly, warehousing, and employees). Approximately 550 Kodak personnel were transferred to Flextronics facilities.

The agreement served to drive profitability, efficiency, and streamline digital camera operations by bringing "camera products to market more quickly, with greater predictability, flexibility, and cost efficiency while maintaining the innovative ease-of-use for which the Kodak brand is renowned." He added that the new strategy would enable Kodak to sustain innovation be focusing on advanced development and other areas to achieve the greatest competitive differentiation and advantage.

Kodak would retain all intellectual property and patents as part of the transaction as well as Kodak trademarks, Kodak trade names, Kodak customers, customer information and customer relationships, Kodak feature specifications, Kodak digital camera designs and Kodak digital camera technologies.

Greg Westbrook, President of Flextronics' Consumer Digital market segment, was formerly General Manager of digital capture at Kodak.

2004

Kodak signed an exclusive long-term agreement with Lexar Media Inc. of Fremont, California to help market digital memory cards by putting its brand name on cards designed, manufactured and sold/distributed by Lexar such as Compact Flash and Secure Digital cards. The agreement was to give Kodak a broader role in a rapidly growing market. Terms of the agreement were not disclosed, however a source of revenue would be provided to Kodak. The agreement would also help Lexar to crack new channels of distribution worldwide. At the time, Lexar products were sold in about 48,000 retail outlets, whereas Kodak was doing business with a half-million storefronts in roughly 70 nations.

Divestitures

2007

Kodak announced an agreement to sell its Health Group to Onex Healthcare Holdings, Inc., a subsidiary of Onex Corporation, in order to sharpen their strategic focus on consumer and professional imaging and the graphic communications industry. Under terms of the agreement, Kodak would sell the Health Group to Onex for up to $2.55 billion. Kodak plans to use the proceeds to fully repay its approximately $1.15 billion of secured term debt. About 8,100 employees associated with the Health Group would continue with the business following the closing. Included in the sale are manufacturing operations focused on the production of health imaging products, as well as an office building in Rochester, N.Y. Kodak’s Health Group, with revenue of $2.54 billion for the latest 12 reported months (through September 30, 2006), was a worldwide leader in information technology, molecular imaging systems, medical and dental imaging, including digital x-ray capture, medical printers, and x-ray film. Onex Corporation, based in Toronto, is a diversified company and is one of Canada’s largest corporations, with annual consolidated revenues of approximately C$20 billion and consolidated assets of approximately C$20 billion. Onex has global operations in health care, service, manufacturing and technology industries. The health care operations include emergency care facilities and diagnostic imaging clinics. Subject to regulatory and other approvals, it is anticipated that the sale will close in the first half of 2007. Goldman, Sachs & Co. acted as financial advisor to Kodak on the sale of its Health Group and Sullivan & Cromwell LLP provided legal counsel. Lazard Freres & Co. provided a fairness opinion in relation to the transaction.

On April 19, Kodak announced it had reached a deal to sell its Light Management Film group (a portion of its display business) to Rohm and Haas Co., based in Philadelphia. Light management film is used as layers on flat panel TVs and displays to improve effectiveness and control brightness. The group comprised 125 workers worldwide, with about 100 located in Rochester. Rohm and Haas would license technology and purchase equipment from Kodak, and lease Building 318 at Kodak Park. The sale price was not disclosed. Rohm and Haas reported sales of $8.2 billion in 2006.

Heute

The company is headquartered in Rochester, New York. The Kodak company holds a vital role in the invention and development of the motion picture industry. Thomas Edison used film stock manufactured by Eastman Kodak during his development of the Many modern Cinema and TV productions (US and worldwide) are shot on Kodak film stocks, including all Academy Awards|Oscar-winning pictures. The company helped set the standard of 35mm film, and introduced the 16mm film format for amateur use and lower budget productions. The home market-oriented 8mm and Super 8 formats were also developed by Kodak. Kodak also entered the Professional Video Tape market, briefly in the mid 1980's, under the product portfolio name of Eastman Professional Video Tape Products. In 1990, Kodak launched a Worldwide Student Program working with university faculty throughout the world to help nurture the future generation of filmmakers. Kodak formed Educational Advisory Councils in the US, Europe and Asia made up of Deans and Chairs of some of the most prestigious film schools throughout the world to help guide the development of their program. It has been called one of the most farsighted programs of its kind by an industry leader.

Ressourcen

• Kodak Launches a Printer Offensive
• Kodak's New Battle: Cheap Printer Ink
• Kodak's New Inkjet Printers and Cartridges
• Kodak enters Inkjet Printer Market
• Kodak Offers Cheap Printer Ink with New Printer Line