It’s a ‘Kodak Moment’: Convergence in the Parking Industry
A little over a year ago, I spent three weeks on a safari in southern Africa. The entire adventure was an awesome ride, and I have many fond memories that will last a lifetime. So, the other day, with the winter blues setting in, I decided to get the trip’s photo album out and escape for a few minutes to pictures of sun and warmth.
Most of the album is filled with amazing photos of various African wildlife from “game drives” in Chobe National Park in Botswana and Kruger National Park in South Africa. It also is full of breathtaking landscapes including Victoria Falls along the border of Zambia and Zimbabwe, the Kalahari Desert in Botswana, and “God’s Window” in South Africa.
As I was flipping through the pages, I came across an amusing image I took in Zimbabwe – a picture of a lonely bus shelter on a dirt road close to our hotel. The bus shelter was the last stop along the main thoroughfare for locals to get to downtown Vic Falls.
The shelter was nothing remarkable, and I’m sure in a town that boasts amazing panoramas of one of the natural Seven Wonders of the World, it isn’t a must-see attraction. However, the side of the shelter donned an advertisement that highly amused me.
My Final ‘Kodak Moment’
Ever the good tourist, I quickly grabbed my camera – errr, I mean smartphone, and got my shot of the sun-bleached ad, one for the iconic brand that used to be synonymous with photography and film. Yes, for none other than the godfather of amateur photography - Kodak!
Let me give you a bit of context as to why this caught my eye.
I grew up in the suburbs of Rochester, NY. It is the home of the garbage plate, the Erie Canal, and none other than George Eastman and Kodak. Back in the day, Kodak was Rochester’s Google and the city’s pride and glory for more than a century.
During its heydays of the 1980s, Kodak was a massive global employer with well over 100,000 employees worldwide and accounted for 90% of film and 85% of camera sales in the U.S. In 1982, Kodak alone employed more than 60,000 people in Rochester, which, at the time, was a significant portion of its population of 240,000.
But Kodak’s good times didn’t last. In 2012, after 130 years of operation, Kodak filed for Chapter 11, marking the end of an era for one of the world’s greatest innovators. Almost 40 years after its peak, Kodak has a mere 1,500 employees remaining in Rochester.
The downfall of Kodak is perhaps one of most cringe-worthy corporate blunders ever made in the history of modern business. Most people don’t realize it, but Kodak actually developed the very technology that ultimately led to its demise – digital photography.
Death by Convergence
In 1975, a Kodak engineer developed the first-ever digital camera, be it a very rudimentary one. However, management wasn’t so keen on further developing the potential of this particular product. Film had been a high-margin business, and Kodak thoroughly dominated that market. Digital imaging would remove the need for film, and to the largest film company in the world, that didn’t sound so good.
Its management never fully grasped how the world was changing. They assumed people would always want hard prints with the highest quality. At that time, digital photography didn’t offer either of those things. Using such logic, Kodak’s reaction to the engineer’s demonstration of the digital camera was tepid at best, letting the engineer pursue his invention, but without investing much into it.
By the time Kodak came out with first commercially available digital camera for the everyday consumer in the mid-’90s, they found themselves as laggards in the digital ecosystem. Not only was Kodak now competing with established camera companies, but they also had stiff competition from those in adjacent industries, such as consumer electronics, looking to expand into new markets. By then, it was too little, too late for Kodak.
Convergence Is the New Innovation
In last month’s Parking Today, I gave my 2018 prediction for the biggest trend we’ll see in 2018: convergence. That’s about taking separate things – be it technology, products or industries — and bringing them together in a new, integrated and unified manner. The goal of convergence is to find a new or better way to meet customers’ needs. In other words, innovation.
Kodak couldn’t look beyond traditional boundaries of their technology, products or industry. They didn’t see electronic industry giants, such as Sharp or Panasonic, which not only took note of the digital camera opportunity, but also aggressively pursued it.
Let Kodak Be a Cautionary Tale for the Parking Industry of What Not to Do
Today, many businesses are still reluctant to make bold moves in the face of new trends and challenges. Such businesses are just as vulnerable as Kodak was to more forward-thinking competitors and innovative disruptors.
We see traditional boundaries breaking down all around us. Incumbent companies who have “played nice” now face competitive threats from both start-ups bringing new disruptive business models and from established enterprises from previously unrelated sectors looking to pivot their strategy or expand into new markets.
Convergence comes in many forms, but the most common types are technology, product or industry convergence. It is important to understand these because they have all taken the parking industry by storm, and it appears the trend is only picking up speed and expanding in scope. For decades our industry resisted adopting and integrating emerging technologies or forming forward-thinking collaborations, but we are now ripe for realizing the full potential of our parking businesses.
Three Types of Convergence in Parking
• Technology Convergence is when emerging or distinct technologies are integrated to create a new, unique product offering. In parking, we see such convergence in the integration of data analytic software with hardware such as sensors and cameras that provides insight into parking operations. This convergence helps operators to analyze, understand and optimize their business. Parking technologies also are converging with technologies from other sectors such as mobility, automotive, transportation and “smart cities.” (This also is a type of industry convergence, which is our next point.)
• Industry Convergence redefines traditional boundaries by shifting focus from individual products to cross-industry value. Players from previously unrelated sectors enter the space of other industries to generate new, additional sources of revenue. Not that long ago, industries had clearly delineated boundaries that separated one from another. Parking was no different. We have been operating largely in a separate ecosystem, with little synergy among mobility, transportation, financial services or automotive industries. Today, we have drawn significant interest from those industries and many others, which want to disrupt, collaborate or acquire their way into parking.
• Product or Service Convergence refers to the bundling of functions that were formerly separate and distinct into a new, multipurpose product or service. Where one product’s function ends and another begins is ambiguous. In parking, we see the traditional rules of the land are no longer, “We’re an operator, she’s a supplier, and he’s a manufacturer.” The gloves are off, and operators, suppliers and manufacturers within parking now have product and service offerings that significantly overlap.
Regardless of type, the overarching objective of convergence in our industry is to provide customers with a more seamless, efficient and convenient experience as they get from Point A to Point B. From apps that provide real-time parking availability and navigate you to an open spot to partnerships and acquisitions of industry players by automotive OEMs for integration in to connected cars, one thing is sure: Parking no longer just parking. We have convergence to thank.