An Open Letter To Kodak's Management
13 March, 2001
I read yesterday that Kodak has announced a price reduction of 50% on its DCS 560 and DCS 660 digital SLR cameras. This reduces them to about US $8,000 from their recent price point of $16,000. Of course we need to keep in mind that when originally introduced 2 years ago they carried a price of $26,000.
Isn't this a little like closing the barn door after the horses have fled?
For the past few years Kodak sat at the top of the digital SLR heap but kept its prices so high (and thus marketing so limited) that only a handful of well-heeled pros could purchase them. Now, with the immanent introduction of a number of 6MP cameras by the major Japanese companies the opportunity to take a lead position has been lost.
I see Kodak doing the same thing with the new DCS Pro Back. This is an exciting product that could open the floodgates for digital adoption by medium format photographers — both pros and well-heeled amateurs. But, by limiting it on introduction to just 2 medium format bodies the company is again missing the opportunity to place itself in a dominant market position.
Owners of other Hasselblad models, Rolleis and all the other medium format brands will simply wait until someone else brings out a self-contained 1-shot digital MF back. My guess is that it won't be more than a year until we see several such digital backs from other brands. Of course by then, this opportunity too will have been lost to Kodak. Also, in this market segment it isn't necessary to license or OEM a body — the way it was necessary in 35mm. A universal back with adaptors should be able to work with almost any manufacturer's medium format cameras.
Sorry to be so negative. Kodak does great technology but blows it every time with inept product and marketing management.
Senior management must be keenly aware of Kodak's share price drop of some 50% over the past two years. Need I remind you that the film business is going away? Digital camera penetration has doubled in the US in the past year and is expected to double again in the next 12 months.
Because of Kodak's current technological edge the high-end digital market offers significant opportunities. Let the Asian high-volume manufacturers slug it out in the low-margin consumer market. Take the high ground and put your leading edge technology into the pro and semi-pro market in a serious and committed way. Hire some competent marketing people to tell your story. The halo effect will also surely also boost your consumer digital sales.
Do it soon, or Kodak, a brand synonymous with photography in the 20th century, will certainly wither in the 21st.
Michael H. Reichmann
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