ROCHESTER, N.Y. (AP) — Eastman Kodak Co. said Thursday that it will stop making digital cameras, pocket video cameras and digital picture frames, marking the end of an era for the company that brought photography to the masses more than a century ago.
Founded by George Eastman in 1880, Kodak was known all over the world for its Brownie and Instamatic cameras and its yellow-and-red film boxes. But the company was battered by Japanese competition in the 1980s, and was then unable to keep pace with the shift from film to digital technology.
The Rochester, N.Y.-based company, which filed for bankruptcy protection last month, said it will phase out the product lines in the first half of this year and instead look for other companies to license its brand for those products.
It's an especially poignant moment for Kodak. In 1975, using a new type of electronic sensor invented six years earlier at Bell Labs, a Kodak engineer named Steven Sasson created the first digital camera. It was a toaster-size prototype capturing black-and-white images at a resolution of 0.1 megapixels.
Through the 1990s, Kodak spent some $4 billion developing the photo technology inside most of today's cellphones and digital devices. But a reluctance to ease its heavy financial reliance on film allowed rivals like Canon Inc. and Sony Corp. to rush into the fast-emerging digital arena. The immensely lucrative analog business Kodak worried about undermining was virtually erased in a decade by the filmless photography it invented.
Today, the standalone digital camera faces stiff competition, as smartphone cameras gain broader use. Kodak owns patents that cover a number of basic functions in many smartphone cameras. The company picked up $27 million in patent-licensing fees in the first half of 2011. It made about $1.9 billion from those fees in the previous three years combined.
Kodak sees home photo printers, high-speed commercial inkjet presses, workflow software and packaging as the core of its future business. Since 2005, the company has poured hundreds of millions of dollars into new lines of inkjet printers. Once the digital camera business is phased out, Kodak said its consumer business will focus on printing.
Kodak said it's working with its retailers to ensure an orderly transition. The company will continue to honor product warranties and provide technical support for the discontinued products.
The moves are expected to result in annual savings of more than $100 million The company didn't say how many jobs would be eliminated as a result of the decision, but did say that it expects to take a charge of $30 million related to separation costs.
Key events in the history of Eastman Kodak Co.
Here are key events in the history of Eastman Kodak Co., which announced plans Thursday to stop making digital cameras and some other consumer devices:
1880 — George Eastman begins commercial production of dry plates for photography in a rented loft of a building in Rochester, N.Y.
1888 — The name "Kodak" is born and the Kodak camera is marketed with the slogan, "You press the button, we do the rest."
1889 — The Eastman Co. is formed, taking over the assets of the Eastman Dry Plate and Film Co.
1892 — The company becomes Eastman Kodak Company of New York.
1900 — The first Brownie camera is introduced. Selling for $1 and using film that costs 15 cents a roll, it brings hobby photography within financial reach.
1929 — The company introduces its first motion picture film.
1935 — Kodachrome film is introduced and becomes the first commercially successful amateur color film.
1951 — The low-priced Brownie 8mm movie camera is introduced, followed by Brownie movie projector in 1952.
1962 — The company's U.S. consolidated sales exceed $1 billion for the first time. Its work force tops 75,000.
1963 — Kodak introduces a line of easy-to-use Instamatic cameras with cartridge-loading film (selling more than 50 million by 1970).
1972 — Five pocket-size Instamatic cameras that use smaller cartridges are launched. More than 25 million cameras sell in less than three years.
1975 — Kodak invents the world's first digital camera. The toaster-size prototype captures black-and-white images at a resolution of 10,000 pixels (.01 megapixels).
1981 — Company sales surpass the $10 billion revenue mark. The next year, hometown payroll peaks at 60,400.
1984 — Kodak enters the video market with the Kodavision Series 2000 8mm video system and introduces Kodak videotape cassettes in 8mm, Beta and VHS formats, along with a line of floppy disks for computers.
1988 — Global payroll peaks at 145,300.
1992 — Kodak launches a writeable CD that its first customer, MCI, used for producing telephone bills for corporate accounts.
2003 — Launch of Kodak Easyshare printer dock 6000, which produces durable, borderless 4-by-6-inch prints.
2004 — Kodak begins digital makeover, the same year it gets ejected from the 30-stock Dow Jones industrialaverage. It cuts tens of thousands of jobs as it closes factories and changes businesses.
2008 — Kodak begins mining its patent portfolio, which generates nearly $2 billion in fees over three years.
2010 — Kodak sues Apple Inc. and Research in Motion Ltd. before the U.S. International Trade Commission, claiming the smartphone makers are infringing its 2001 patent for technology that lets a camera preview low-resolution versions of a moving image while recording still images at higher resolutions. Global employment falls to 18,800.
July 2011 — Kodak begins shopping around its 1,100 digital-imaging patents.
September 2011 — Kodak hires Jones Day, a law firm that lists bankruptcies and restructuring among its specialties.
December 2011 — Judge extends camera-patent dispute into 2012.
January 2012 — Kodak files for Chapter 11 bankruptcy protection as it seeks to boost its cash position and stay in business.
February 2012 — Kodak says it will stop making digital cameras, pocket video cameras and digital picture frames.