Risk register · entry
Q1 · PredictableKodak Chapter 11 Bankruptcy
Invented the digital camera in 1975, then buried it to protect film. Bankrupt by 2012, $6.75B in debt.
Documented, foreseeable risks that were ignored anyway. The failure is attention, not information.
Why this room
Kodak is a Predictable-quadrant case because the disruptive technology was invented inside the firm and its trajectory was legible in the company's own accounts for more than a decade before the filing. Kodak's engineers built the first self-contained digital camera in 1975 and patented it in 1978; management declined to commercialise it in order to protect film revenues. No new information was required at any point after that. The failure was one of attention and incentive - the margin structure of the film franchise made the correct response unattractive - and the 2012 filing is the terminal event of a decline visible in Kodak's revenue and headcount series since at least 2003.
The record
- Eastman Kodak filed for Chapter 11 on 19 January 2012 in the U.S. Bankruptcy Court for the Southern District of New York, listing assets of USD 5.1 billion against liabilities of USD 6.75 billion.certain
- Steven Sasson's December 1975 prototype used a 100x100 pixel (0.01 megapixel) CCD, weighed 3.6 kg, and took 23 seconds to record a single black-and-white image to cassette tape; Kodak was granted U.S. Patent No. 4,131,919 on the design, and it never entered production.certain
- Kodak entered Chapter 11 with a USD 950 million debtor-in-possession credit facility arranged by Citigroup; its shares closed at 39 cents on the filing day, down 29.7%.certain
- Revenue fell from USD 13.3 billion in 2003 to about USD 6 billion in 2011, and headcount from about 64,000 in 2003 to about 17,000 in 2011.high
- Kodak exited Chapter 11 on 3 September 2013 after 19 months, having eliminated roughly USD 4.1 billion of debt; its 1,100-patent digital imaging portfolio, once valued at around USD 2 billion, sold for USD 525 million.high
Sources
The book
This entry is one of 111 in the register. The full story, and what it cost the people who lived it, is in Risky Business by Claudia Zeisberger, David Munro and Joanna Reijgersberg-Siew.
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