
Pick up a paper or turn on the news and you’ll likely come across the two big stories of the week – pending Congressional Internet IP legislation (SOPA, PIPA) and Kodak’s Chapter 11 filing. Both stories are big news in their own right, but is there a common theme between them? First, a little background:
The Stop Online Piracy Act (SOPA) in the House, and Protect IP Act (PIPA) in the Senate are intended to combat piracy of copyrighted materials by permitting the U.S. government to block access to sites it deems to be infringing. Opponents of this act fear that passage will lead to censorship of the net and greatly limit the free flow of information.
Kodak, once the dominant player in the U.S. photographic and printing market, began to see its position erode with the advent of digital technologies in the 1990’s. The company’s failure to maintain a leading position led to its 2004 removal from the Dow Jones Industrial Average index and its ultimate bankruptcy filing on January 19th. While today Kodak furiously attempts to reinvent itself, its future as a going concern is anything but certain.
Both stories underscore the reality that rapid acceleration of change has undermined traditional methods of doing business. Rather than adapting to new technologies, the recording and motion picture industries spent years fighting against enabling technologies through traditional advocacy and advertising. Their efforts, which led to the impending votes on SOPA/PIPA, now appear derailed by opponents communicating through social media channels and by the voluntary protests/blackouts of Internet companies directly impacted by this legislation.

Likewise, while its competitors committed to adoption of digital technologies, Kodak stuck with an existing business model and only made tentative moves into these new markets once they became established. As a result, companies like Nikon, Canon, Fuji and others captured preeminent positions in the digital photographic market and HP and Epson in the digital printing market. By 2012, the company that once controlled 90% of U.S. photographic film sales was a shell of its former self.
In both cases, new technology and approaches trumped the old ways of doing business. Failure to adapt led them to cling to business methods that worked at one time but are ineffective today. Their managements did not recognize the disruptive changes affecting their businesses early on. Consequently, they failed to deliver the products and services that their customers were demanding.
While the business environment is always evolving, the pace of change today continues to accelerate, amplifying the impact of strategic missteps and compressing time available for recovery. Some may view this as a time to “adapt or die” but I prefer to remember that with change comes opportunity.
Keep an eye out for the next disruption in your industry; it is probably closer than you think.
Tags: SOPA, PIPA, kodak, bankruptcy, kodak chapter 11, bankrupt kodak, censorship, film industry, music industry









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