Re: Carl Zeiss on the Future of Film



Scott W wrote:
Gordon Moat wrote:


I think a really good way to imagine a worse case future is to look at
the fine art world and oil paints. I cannot just go to Target, WalMart,
CostCo, or the local Ritz to get oil paints. I have to go to a
specialized art store, or I need to buy through a catalogue or from
internet outlets. It is not convenient, so I need to plan ahead what
paints I need. Sometimes there will be a temporary shortage at the local
art store of certain colours. Oil paints for doing fine arts are
definitely a no growth industry, more dead than anyone could ever
imagine for film.



Well I don't think photography really ever had an effect on painting in
general. Are you talking about the effect that acrylic paints have had
on oil?



No. I am specifically addressing the supply problems of getting oil paints. Acrylics are not much more available, though I notice cheap varieties in just slightly more stores. There are two prominent makers of oil paints, and several minor players; with acrylics there are a few more . . . neither situation makes availability of oils or acrylics convenient.

An industry can be small and not have growth and still be in good
shape. An industry can not be in good shape lossing 30% of its market
a year. Will this settle out in time and if so when?


Perfect example: oil paints might be considered a semi stable market, with only slightly year to year fluctuations. The film market has not reached a bottom stability level, though it was at a high volume mass market level for decades. Oil paints were never a mass market item.


Clearly in the not too distant future film is going to be a small niche
market. It is not at all clear that Kodak or Fuji, or even Lucky for
that matter, will want to service this market.

Profits. Simple profits. While investors want to see unrestricted growth, to the point of any company becoming a monopoly, the decisions often come down to the Board of Directors, and the upper level management. Longer term investors, and institutional investors realize the growth can never be unrestricted, nor unregulated, so what they expect is profits. READ THE SEC REPORTS CAREFULLY . . . film still generates profits. At the moment, that profit satisfies the major shareholders, the large institutional investors, and the long term investors.

However, shares in public companies need volume in order to generate sales of stocks. There is a need for volatility. While it is true that less than 5% of investors dictate the market (mostly institutional investors), the reality is they need the other 95% of investors to create volatility; that volatility, and frequency of trades, generates profits for investors. Company profits help investor confidence, though the psychology of wording in reports will affect volatility. The dangerous balance is to generate a high volume of share trades, yet maintain some level of investor confidence.

So why mention the stock market, and all this at all? Both Kodak and Fuji are making moves into other industries, largely not consumer driven industries. The general public does not really understand medical imaging and the printing industry; this leaves Kodak and Fuji to make statements about their more public oriented divisions, namely consumer film and digital imaging. The problem at both companies is that digital imaging has not generated profits, though it might get close to break even soon, or might generate profits if a few competitors leave this industry. Film still does generate profits, but the all important volatility is in danger of stagnating if those smaller (less money) investors (the 95%) don't think the company is going anywhere.

The big revenue and profit generators at Fuji and Kodak are industries the public does not understand. However, the major shareholders and institutional investors do understand the moves into those industries (though Fuji is slightly behind Kodak so far). Release reports about this, and the 95% buyers eyes will glaze over, the volume of daily trades will go down, this makes it tougher for the major traders to generate profits from share price fluctuations, the stocks become somewhat stagnated, eventually share prices drop due to lack of interest in the company.


But making film is not
like making paint, with paint you grind and mix (you could do this in
your kitchen if you wanted to). Film requires a capital investment,
and it will be hard for anyone to make this investment while they have
to compete with Kodak and Fuji in a market that is collapsing.


People made film and photographic plates without major capitol and factory facilities in the past. Neither of us can know if there will be interest in a cottage industry film, though making B/W should be fairly simple. Maybe Ilford is the only company left in the distant future, though perhaps employing only ten people instead of hundreds.


I don't expect Kodak or Fuji to pull out of the film market in the
next 5 years but I would not count on much more then 10 years.

But in 10 years will there really be many people who care if they can
get film or not?


Sounds like a bet to me. I will take that. Kodak and Fuji branded films in ten years . . . what should we bet?

Ciao!

Gordon Moat
A G Studio
<http://www.allgstudio.com>

P.S. - I really think you completely missed my point. The lack of convenience with using oil paints has not stopped me from using them.

.

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