The BBC’s Kodak Moment
The phrase “it’s a Kodak Moment” marked the peak of the iconic American camera company’s success. George Eastman’s brainchild, which had given the world the first folding camera, the Brownie, the first home developing machine, Kodachrome, Starmatic, Instamatic and the carousel projector, had by 1976 cornered 90% of the film market, and the horizon looked sunny and clear.
But in 1977 Steve Sasson invented the world’s first digital camera, and in 1990, when the first model hit the open market, suddenly the storm clouds were gathering. Recognising the threat to their wet-film business, Kodak focused on film developing and printing technology, failing to understand that nobody wanted to develop and print hard copy images any more. The world was now sharing images on mobile phones, computers and the internet and in 2012, Kodak filed for Chapter 11 bankruptcy.
It was then that the phrase “Kodak Moment” came to mean the point in time when your organisation died because it had failed to adapt.
Their story could be pithily summarised by Danny DeVito’s riveting speech as Lawrence Garfield in the 1991 film Other Peoples’ Money:
“And you know the surest way to go broke? Keep getting an increasing share of a shrinking market. Down the tubes. Slow but sure.” (Here’s the clip if you’re interested, it’s a great film).
Kodak are of course not the only organisation to have died because they failed to recognise how their environment was changing. Much more recently Thomas Cook failed to appreciate that the world was moving away from visiting high street travel agents (where they held the lion’s share of the market) and moving to booking holidays online.
A COMPANY ON THE EDGE
And the BBC is facing the same existential threat. The British institution, once the sole and unimpeachable player in the broadcast media market, now faces growing subscription service rivals like Netflix and Amazon. In 2019, fewer than half of 16-24 year-olds in Britain watched a live BBC TV channel once a week. And younger viewers are twice as likely to watch BBC programmes on Netflix as on the BBC’s own iPlayer service.
Add to that the equal pay disputes, the diversity argument, accusations of bias from both sides of the political divide, the Jimmy Savile and Lord McAlpine scandals, an unfriendly government, and an ageing, dwindling audience, and you can see why Tony Hall recently stepped down as Director-General. Hall was a calming presence at the BBC and had presided over some notable successes, but critically had not secured a competitive digital future. Just like Kodak.
Faced with a situation like this, some of the problems will seem intractable. The gender pay gap, free licences or not for pensioners, and the irony of a TV doctor earning more than a GP are probably situations that cannot continue. So the case for significant change as opposed to at-all-costs-preservation-of-a-deteriorating-status-quo, becomes ever more compelling.
Will viewer loyalty save Auntie, still purportedly one of the most trusted news organisations in the UK? No, it won’t. Viewers will always look for and find the quickest, easiest, cheapest and most fun route to watch what they want to watch, and why would they not?
With many influential figures regarding the licence fee as an unsustainable model, the new Director General now faces the task of transitioning an exhausted and punch-drunk BBC to an internet-streamed subscription model when their rivals are already well ahead of the game and continuing to move fast. The Britbox initiative can probably solve a large part of the content availability, providing that it is not too little too late, and so the funding is the big conundrum. As a fan of the corporation I genuinely wish the new DG well in what will be a monumental ask.
So what does THAT have to do with Business Continuity?
Business Continuity is often seen as simply Crisis Management and Emergency Response, and both disciplines are critical to the survival of a business. But the best crisis is the one that you don’t have to go through. If top management has the clarity of vision to both see and to recognise what is coming over the horizon, and the strength of will to change their organisation accordingly, they can avoid the potential crises, and continue towards their goals. And changing an organisation may well involve taking some sacred cows to the barbecue and making them into steaks. Like the licence fee.
Because here’s the point. If the BBC can retain and re-build viewers’ trust, and create an attractive subscription model, it is likely to survive its impending Kodak Moment. By contrast, if it insists that it must retain the licence fee in the face of government initiatives to de-criminalise non-payment, Ofcom’s calls for a subscription model, and an evaporating audience, it will gain an increasing share of a shrinking market…Back to Mr DeVito.
That is why we at Inverroy constantly espouse horizon-scanning and a willingness to make significant changes as a vital part of Business Continuity. We strongly advise clients to get their data right, to ruthlessly analyse their environment, to actively seek out both opportunities and threats, to exploit the former and avoid the latter, and to be prepared to change before change is forced on them. As Brad Pitt said in Moneyball, when portraying the real-life Oakland A’s baseball coach Billy Beane; “Adapt or die.”
And there are opportunities out there. As we approach Brexit, there is a gap in the market for a “public face of GB plc”, and the BBC could be in a good place to fill that gap. In the process it could, with luck and hard graft, re-build its enviable but tarnished reputation for impartiality and excellence. But it has to survive first. If media reports are to be believed, the corporation is living in morbid fear of its 2022 mid-term review, when funding options will be the subject of serious study instead of the current interesting speculation.
NOW IS NOT THE TIME TO WAIT
Any business continuity consultant would advise them not to wait for 2022, but to immediately resource an in-house study team and create some realistic and workable options. Those options, studied, war-gamed and costed can then be presented to mid-term review team for consideration in 2022. The alternative, of waiting for change to be imposed externally, probably by a hostile or semi-hostile review team, is about as enticing as do-it-yourself root canal treatment.
Who did Steve Sasson work for when he invented the first digital camera? Yes, you guessed it – Kodak. Ironic, that…