Dubai Just three months after Kodak, a company once as closely associated with photography as Google is with search, declared bankruptcy, Facebook has purchased one of its killers.
On Monday, the world's largest social network announced it would purchase Instagram for $1 billion (Dh3.67 billion). Instagram, an app that combines photography and social networking, allowing its users to make their photos look exactly like classic Kodak Instamatic and Polaroid images, among other things.
It's a shame Kodak never invested in the technology and this is an irony.
It's no secret that Kodak's failure to adapt to a digital world is what ultimately lead to its demise, but Facebook's announcement is finally shining the light on the real killers, of which Instagram is only one of many. There is also Snapseed, photo-editing software that has been heavily promoted on Apple's AppStore and was named iPad App of the Year in January. Then there is Photogene, which combines photo-editing with photo management. The ever growing list of photo-graphy apps also includes Abode's Photoshop Express, Photo Toaster and Pixlr-o-matic, just to name a very few.
Tablets are also making the future of photography increasingly digital and wireless, even among professionals. Eye-fi, a Silicon Valley company founded in 2005, makes SD storage cards with built-in wireless that allows photographers to send their images directly to any tablet with the Eye-fi app installed. The photographer can then edit the photo directly on the app and then send it directly to a website.
It's easy to see why Kodak has been losing the war over digital photography. Last week, the company asked a bankruptcy judge to allow it to pay 300 executives and other employees a total of $13.5 million (Dh49.57 million) in bonuses to persuade them to stay with the company as it reorganises under bankruptcy protection.
By comparison, Instagram has 13 employees. It has no revenue — the Instagram app is free download — but since its founding in 2010 the company has gotten along on the $57.5 million it raised in venture capital.
Burbn Inc., which owns Instagram, is based in San Francisco and was co-founded by Kevin Systrom, a Stanford University graduate and former Google Inc. employee.
"It's a massive accomplishment," said Shervin Pishevar, a managing director at Menlo Ventures in Menlo Park, California. Pishevar backs social-media companies, though he didn't invest in Instagram. "This is an indicator of what great teams and great products with amazing execution can accomplish in historic amounts of time," he said.
Irony again, as Kodak was founded in 1880. Whether Kodak will be able to emerge from its current bankruptcy proceedings in 2013 as a competitive company is still far from certain. The company has long looked to its patents as a being prime assets, but even patents can lose value, as AOL is currently learning. Unless it finds some way to reshape itself and bring it up to speed, emerging from bankruptcy may be a moot point.
— With inputs from agencies