Is Film Dead?


Let me answer simply. Yes. Film is dead.

By that I do not mean that there is no more film. I mean that film as a medium has been usurped by digital imaging technology, and photographic film has no future. Whether it lasts another two years or another ten, it will spawn no new innovations, no updates, no fixes. It is as good as it will ever get, and it is all downhill from here to zero, however long that takes.

I am not saying this because I hate film. In fact, I love film. I sell film. I would like film to survive, but I do not think that it will. Why do I talk about the 'death of film' if I love it? I dunno, does ignoring a negative medical prognosis make you better all of a sudden? I am selling film because I want to do everything I can to ensure that it is available to those who love it and want it for as long as possible. If anything, I am trying to drum up demand in a steadily-shrinking market. I acknowledge the market is dying, but am doing CPR as fast as I can - even if I know that the patient is nearly flat-lined. Sorry if that seem incongruous to you.

I also do not hate people who love film. This is not personal. Casting the 'Film is Dead' debate in personal terms only ends up in invective and anger. And believe me, I've gotten well stuck into it - and ended up both angry and engaging in insulting behavior (which I regret, by the way). Both sides are entrenched in their beliefs - one that film is dead, the other that film will ive forever, if only as a niche or boutique market. I have a side, of course - I can't pretend that film will survive, because I believe it will not. My arguments against it are logical and compelling, and I believe they are right.

I could also be wrong. I hope I am. I have an ego, but I'd love to have to say in ten year's time, "Well, I sure was an idiot about that, wasn't I?"

What follows is a set of my answers to the most often-quoted reasons why film will live forever.

To keep the peace, I will speak on this issue no more on this forum, unless I am goaded beyond endurance.

Smooches,

Wiggy


1) The "Supply & Demand" Argument:

This argument misquotes an economic theory that purports to say "As long as there is demand, there will be a supply." This is true often enough that it appears axiomatic, but it is not - nor is it a correct quote.

http://en.wikipedia.org/wiki/Supply_and_demand

It is easily disproven. Suppose that there is a public demand for a particular widget. A supplier steps forward and will produce that widget - for $10,000 per unit. The public will not pay $10,000 per unit, they wish to pay $100 per unit.

The net result of this hypothetical example is that demand goes unfulfilled.

If there is insufficient demand, it will go unmet. A single person, for example, cannot generate sufficient economic demand to induce a supplier to go to production to meet that need. An example of that would be the ever-clamoring Star Trek fans who make a great deal of noise, sign petitions, and even promise direct economic aid, but who cannot seem to induce a major studio to continue to produce a Star Trek television show at this point. In the past, they were able to generate sufficient market demand - now they cannot. This demand goes unmet.

There are other reasons that demand might go unmet. Examples in the Western hemisphere include an economic bar to entry that keeps smaller producers out - they simply cannot afford multi-billion dollar outlays to make a small return on an uncertain market that only shows signs of shrinking and not growing. Another example would be environmental laws that would allow existing plants to remain in production through 'Grandfather Clauses', but which would effectively prevent any new entry into those businesses.

The "As long as there is demand, there will be supply" argument is therefore discarded - it is a misquote and a specious argument, a wave of the hands in the air as if quoting it will somehow make film remain in production.

2) The "Buggywhip" Argument:

This argument is that film will retreat, but will become a niche or boutique market, with smaller demands met by smaller companies. The argument is that although we do not ride horses or buggies to work everyday anymore, one can still find buggywhip manufacturers, small cottage industries that make a tiny supply of buggywhips to meet the smaller demand.

This argument assumes that the bar to entry for every industry is the same, which it is not. For example, to make buggywhips, one would need access to finished leather, cutting tools, and industrial stitching tools. Perhaps some wood to make a handle, some patterns, and skilled workers to cut, stitch, and assemble the products. All of these things are readily available. Even without a high demand for buggywhips, there is sufficient demand for leather, wood, and machines to cut and stitch such products that these items remain in production and available.

This is not the case for photographic film. Although B&W coated flexible plastic film dates to the beginning of the 20th century, color negative and reversal films are far more recent, and required access to esoteric and dangerous chemicals, huge facilities for precision coating, slitting, and packaging operations to make them acceptable. In addition, only a few of the very large players 'got it right' to the extent that they were economically viable. For example, Fuji, Kodak and Agfa color products were seen as acceptable in the consumer market - Ferrania is largely seen as unacceptable. And Ferrania's factories represent a major step above what could possibly be produced on a small-scale or amateur basis, disregarding access to raw materials.

Nor can we ignore the fact that most of the current major film manufacturers also own the raw materials that go into their products, right down to the mines in which particular ores are mined, the chemical plants where specialized chemicals are created, and so on. In most cases, they also create their own plastic backing films as seperate lines of business, rather than buy them on the open market.

So one must ask - where is the boutique manufacturer to purchase supplies? This is not leather, awls, and wood. This is a series of deadly chemicals that are highly toxic, carcinogenic, and damaging to the environment. What small business is going to be able to pass EPA certification processes to produce these films, and where will they even get the chemicals to make them, since the only companies that produce them are owned by the current manufacturers and will presumably not be produced when there is no more internal demand for them.

Where will the precision coating and slitting machines be sourced from? These are not LP record pressers, which are available used and can be refurbished in many cases. In the cases of existing equipment used by Kodak, Fuji, et al, they are actually part of the factory - built-in, so to speak. These are not industrial sewing machines that can be put on a truck and sent off.

Photographic film is not a buggywhip. There are hundreds, perhaps thousands, of components. Patents and trademark secrets about how the chemicals are mixed, applied, and made to adhere to the plastic backings. Extremely specialized machinery used to apply it, slit it, and package it - none of which can be readily done by trained human hands. And raw materials that will become unavailable the moment the film manufacturers stop making the film that the chemicals are exclusively used to create.

3) The "Niche Market" Argument:

Niche markets exist to serve the market needs of shrinking demands, or reduced demand that has reached stasis, and work where the economics of supply can be scaled down to meet decreasing demands. For example, an egg producer might choose to reduce their flock to meet a smaller demand for eggs.

However, imagine an egg producer who had a huge and highly financed poultry farm, which must make a certain level of profit to continue to service the debts owed. How would this egg producer scale down? The only way would be by raising prices so that profit levels remained the same.

Consumer film sales in the US have been dropping from 20 to 30 percent per annum for several years now, leading to a 1.1 billion dollar loss for Kodak for a single quarter. If a factory producing consumer film, for example has to scale down from 10 million rolls of film a year to 10 thousand rolls of film a year, yet has debt and expenses that do not shrink with smaller production, then the retail price of consumer film must rise by 1,000 percent to continue to produce the same level of profit. Some expenses related to operating a factory are relatively fixed, such as the cost of electricity, insurance, service, labor, and taxes. These must be met no matter what level the factory is producing film at.

A roll of film that cost $3.50 at retail would now cost $3,500. What consumer would pay that price?

In addition - a factory is generally designed to operate efficiently at maximum throughput. Efficiencies of scale tend toward maximum when the factory is put to full use. One cannot simply 'throttle down' a factory designed to produce X number of rolls of film per day. One might operate the factory for fewer days, but then you have to deal with the reality of labor costs - do workers generally agree to keep their jobs when reduced to one day a week, or one day a month? No, they quit or are laid off and they move on.

So no, Kodak and Fuji cannot 'scale down' their operations to economically produce ever-smaller quantities of their consumer films. Smaller companies that might otherwise seek to inhabit the perceived niche would find that they could not obtain the specialized chemicals, equipment, and environmental permissions to build a smaller set of manufacturing facilities to service a smaller market.

And what of the distribution channels? How will you get your niche film to market? Currently, there are efficient markets setup to move product from factory to warehouse, from warehouse to transportation, from transportation to distribution points, from distribution points to wholesalers, and thence to retailers. These channels are discontinuing their distribution efforts for film - they make space for what they can move in volume. Oh, it is possible to move small quantities of anything to anywhere - but the costs spiral - they are not efficient in any sense of the word. Again, the prices at the retail level must go up.

Hence, there will be no 'niche' market for consumer-grade color film.

4) The "Medical X-Rays and Hollywood Still Use Film" Argument:

If you believe this, you're not paying attention. X-rays have almost all been replaced by digital technology. And the major film manufacturers have been saying to Hollywood, Bollywood, and the Asian movie industry for several years now that film will be unavailable in a fairly short period of time. Hollywood has been attempting to inform and influence independent theater owners that they must invest in digital film presentation equipment, which has been met with growing skepticism and refusal. However, in this case, the tail does not wag the dog. The availability of supply will control the outcome - not the demands of movie theater owners. When the manufacturing lines for color film used in movies shut down, no amount of demanding will bring them back, and the major studios will have no desire to demand such a thing anyway, since their corporate-owned theater chains will have upgraded. Less competition by mom-n-pop theaters will not cause much hand-wringing by the Hollywood studios.

This has a precedent - when the talkies came out, many movie theater owners refused to upgrade. They were shoved aside and made irrelevant and eventually put out of business by those theaters that did show talkies instead of silent films. The movie industry will be releasing their top movies on digital only, and the smaller theaters that refused to upgrade their facilities will be unable to show them. Crowds will go elsewhere, and that's how that game is played.

In any case - consumer-grade photographic film has been the major seller in the photographic film industry for many years - not x-rays, not motion pictures. People taking snapshots. If consumer film sales are falling off, then x-ray film sales and motion picture film sales must suffer, not vice-versa.

5) The "They Still Make 8mm Film and 110 Cartridge Film" Argument

This argument states that since it is still possible to buy newly-made 8mm movie film (which has a very low demand worldwide and is definitely a niche market) then that proves that there is a potential for a niche market for consumer-grade photographic film.

This is specious on its face. 8mm film and 110 cartridge film are made by slitting bulk rolls of photographic film. If the photographic film no longer exists, then the 8mm and 110 films will be gone as well. These niche markets exist because all that is necessary to produce them are precision slitters and perforating machines. There is no chemical emulsion coating process, since that is already on the film being slitted, perforated, spooled, and boxed.

6) The "You Nay-Sayers are Destroying Film" Argument

I am not capable of negatively impacting a multi-billion dollar industry, but thanks for the ego boost.

7) The "Film Will Not Die, I Will Not Let It" Argument

OK, whatever you say. Call Kodak, that will work.

8) The "Film is Superior to Digital" Argument

I agree - film is superior to digital at the moment. That will change in time, but for now, there are many things that film does much better than digital technology - some things cannot be reproduced at all by digital tech; only film can do them.

This fact has nothing to do with the survival of film as a viable consumer product.

Consumers prefer digital cameras. Consumers, in their millions, are buying digital cameras. The market, in the everlasting attempt to give the consumer what they want, is creating more and more digital cameras and more and more capability in those cameras, and forcing themselves into tighter and tighter production cycles, all in an attempt to gain critical market share and find a long-term survival strategy in a rapidly-shifting marketplace.

Consumers do not want to buy film cameras anymore. I am not speaking of you and I - we're discerning photographers who well understand what is being given up by waving goodbye to photographic film. I am speaking of Ma and Pa Kettle, Joe Sixpack and his drunken football buddies. They outnumber us about a million to one, and they are buying digital cameras.

The sole remaining photographic film sales numbers are being generated by sales of single-use cameras - which are being sold strictly on the basis of price - a couple dollars to allow Joe Sixpack to take photos of the tailgater when he does not yet have the means to buy a digital camera or forgot to charge the batteries. When cheap disposable digital cameras hit the market in large numbers, that remaining niche will be gone overnight.

And that, as they say, is that. "Superior" means absolutely NOTHING in this new market. We are discerning - the average consumer is not. They are billions of people, we are in the millions. They win. EVERY TIME. Sorry, fact of life.

9) The "Film is Making a Comeback" Argument

This one is pure fantasy, fueled by wishful thinking and a few anecdotal stories. Someone quotes something their camera dealer told them - that some pro snapper came in, tossed his new digital equipment on the counter in disgust, cursed it roundly, and demanded their film kit back again. The usual story is that some famous photographer had a temporary dalliance with digital, but soon came to their senses once they really had to compare results with film, and that was the end of their infatuation.

Therefore, you see, film is poised to come roaring back and digital will be decimated and reduced to the consumer-level digicam happysnap machine, if it survives at all.

I can blow this silly thing up with a few simple and undeniable facts.

a) There are film camera makers going out of business left and right. No new ones.
b) There is less and less film available every day. No new film makers.
c) Camera shops are closing so fast that you can hear the doors slamming.
d) Go to any Walmart, Walgreens, or similar store which sells film. Observe the shrinking film aisle.

Film is not coming back. I have no doubt that there have been people who tried digital, hated it, and went back to film. Very few. Sorry. Facts is facts. A few anecdotal stories do not recreate a market segment.

Others have noted that their favorite film processing lab is experiencing a real upsurge in popularity. I have no doubt this is true, and there is a simple reason for it. As processing labs exit the market, the remaining consumer base has to go somewhere, so those who remain experience a positive 'bounce' until market forces dip further. The opposite would be true if a new film processor came online - everyone would see a slight dip in demand as the market absorbed the same film processing production across the board, but with more processors instead of less. This is simple math, folks.

10) The "The Film Manufacturers Are Not Defending Film" Argument

This is less an argument than an admission that film is dying, and an attempt to blame the film manufacturers instead of the consumers who don't want to buy film anymore. We are religious about our film - we always have been; look at the interminable "Kodak vs Ilford vs Fuji vs Whomever" wars. The manufacturers are businesses. They exist to make a profit for their shareholders. Their fiduciary responsibility is to those who own the company, not a fading market that was once a source of profit. "Fighting the good fight" is bad business, plain and simple. It might make you or I swell with pride and swear undying loyalty to that company, but we're about a gazillionth of their market share - and Joe Sixpack doesn't care about the company 'sticking up for film'. The stock holders would be furious if told that the company adminstration put loyalty to customers above profits and long-term survivability of the company. "Sorry, we lost all your investment, but we sure showed them, didn't we?" I don't think so.

11) The "Sure There Is a Demand for Film - Look Around You" Argument

No, we are not 'demand'. We are a drop in the bucket. I'm sorry, but it is true. Digital cameras are selling in the hundreds of millions, soon to be the billions. We are a few thousand? Maybe a few tens of thousands? I'm sorry that we don't count, but we don't.

12) The "Evil Manufacturers are Unfairly Pushing the Market Towards Digital" Argument

Also known as the "Evil Manufacturers are Intentionally Killing Off Film" Argument.

First, this is pure paranoia, of a rather scary type - but found often enough to be addressed here. Second, even if it were true, there would be nothing to be done about it, so it makes no difference. Film would be dead either way, whether it slipped off the ledge or was pushed. If you really believe manufacturers are essentially evil and are trying to kill off profitable market segments just to deny you photographic film - even cooperating with each other to destroy a healthy industry that they used to make a lot of money from, you need professional help. Really.

However, to address this in terms that are a bit more sane...

Manufacturers love nothing more than stasis. Selling the same product into the same market segment, year after year. With the same competitors, the same consumers, and stable prices for supply and labor. Manufacturers have no desire to make radical changes in marketplaces unless they are in danger of losing their entire market share. Shaking up markets is risk, and risk is bad if there is a 'no risk' choice, from their point of view. It is true that every manufacturer seeks to increase sales at the expense of their direct competitors, but this is generally done in small ways - 'New and Improved' versus 'Throw your cameras away and buy these new digital cameras!'

Nobody wants revolution in manufacturing. Nobody wants to own a segment killer, nobody wants 100% of a market. That's because it attracts regulatory attention, and you lose view of your competition. When all your competitors are in plain view, in an established market with a high bar to entry, you can stop worrying about young upstart companies coming along and cutting your guts out. No one has any vested interest in upsetting the apple cart - why? Everyone is getting rich enough.

However, technology drives modern markets. Consumers demand it. PC manufacturers cannot adhere to the old ways - IBM tried it with the PS/2 line and got their lunch eaten for them by the likes of Dell and Compaq. In fact, consumers began to make increasing demands, which in turn drove manufacturers into cost-cutting and innovative R&D, investing huge sums of money in new fab and manufacturing techniques which drove ever-faster turnaround cycles. Unlike the automotive industry, which delivers new cars yearly and major model changes once per decade, the PC world doubled their capability at the same price point every 18 months. Not choice of color or tailfins, but revolutionary upgrades in processing power that made previous models seem slow and eventually obsolete in a very short time.

It is clear from computers - consumers drive this market. Manufacturers dance to their tunes - and lose their shirts when they fail to keep up.

And the digital revolution has come to all aspects of the electronics industry. Radios, audio gear, automobile electronics, televisions, cell phones, everything that once had an IC chip in it now has a much faster and 'smarter' CPU controlling things. There have even been (largely ignored at the moment) attempts made to connect refridgerators to the internet to control ordering and inventory control.

Kodak invested in basic digital camera R&D dating back a decade. However, consumers didn't want it, professionals didn't want it, and it was kept on the back-burner for a long time. When the digital explosion touched cameras, the change was a belweather which failed to be heard by the moribund and hidebound photographic industry - even and especially by Kodak, who had done much of the initial research into digital cameras in a classic "one hand doesn't know what other is doing" example.

As shocked photographers stared in disbelief, the fastest technology upgrade cycle in history hit photography like a tsunami. The manufacturers were just as shocked, and they failed to respond in anything resembling a timely manner.

But market forces were insistant, and the most prescient among them finally began to take radical action, including jettisoning or spinning off suddenly-unprofitable segments of their industries.

No, the evil manufacturers are not driving this revolution or pressing this crown of digital thorns down upon our brows. They'd have preferred it if the digital revolution had never come to photography. They were sleeping giants, and they did not want to be awakened, let alone kicked with steel-toed digital boots until they begged for mercy and tried to play catch-up as fast as they could.

posted by Unknown at 11:22 AM

---