More low-tech companies filing Chapter 11
Kodak is just the latest low-tech company to file for bankruptcy. What will be next?
Adriene Hill: Eastman Kodak declared Chapter 11 bankruptcy protection this morning, which is hard to be surprised by. Digital cameras, the cameras on our phone -- they've changed the way we think about our snapshots. And it's the latest in a string of low-tech companies that didn't change course fast enough.
For more we turn to Henry Blodget, editor of Business Insider. Good morning.
Henry Blodget: Good morning, thank you for having me.
Hill: So we’ve seen Borders, Blockbuster, and now Kodak -- all businesses that just didn’t keep up with technology. What industries or companies do you think are next?
Blodget: Well, I think certainly the media industry is in trouble and figuring out what it's going to do. Obviously newspapers have had to radically change their models. I don’t think there’s any question that the Internet will continue to create havoc with traditional industries and you’ll probably see more companies like Blockbuster.
Hill: How can old tech companies stay relevant?
Blodget: I think when you have a change as radical as the one that destroyed Kodak, it is extremely difficult. Basically, a new technology came along and it eliminated the need for their core product; people don’t sell film for digital photography. People like to say it's that the companies were stupid or they missed something. I think the truth is, that the market changed and they just didn’t change quickly enough.
Hill: Is there an industry out there that everyone says is going away that you actually think will make it?
Blodget: I think the TV industry is surprising a lot of people with its resilience. For the last five to ten years, everybody has been saying, “network TV is toast, people like to watch shows now. They don’t care about NBC or ABC, they’re just going to watch their favorite shows and the cable industry will disintegrate.”
And it turns out that people are actually very willing to pay for the convenience of having a big pipe bring in everything into their house and even as cable bills keep going up and up and up, people still are willing to pay for that. There is still this argument about what will happen to TV but right now it’s surprising people with its strength.
Hill: Henry Blodget is editor of Business Insider. Thanks so much.
Blodget: Thank you for having me.