The Rise of Digital Photography and the Fall of Polaroid
The Rise and Fall of Instant Photography
More than 60 years ago, in 1948, Polaroid Corporation launched the instant camera, delighting everyone with its ability to print photos in seconds. Edwin Land’s invention was a complete success. By the 1960s and early 1970s, Polaroid held a monopoly in the instant photography market. Its sales accounted for about 20% of the overall market for film and 15% of the camera market in the US (Nagy Smith, 2009).
However, around the 1990s, digital cameras started to dominate the photography market, and Polaroid began to lose significant market share. Sales fell, and in October 2011, Polaroid filed for bankruptcy. Polaroid went from success to obsolescence due to the invention of digital photography, consigning instant cameras to a dusty shelf.
Schumpeter’s Theory of Economic Development
So what happened? The theory of economic development by Austrian economist Joseph Schumpeter provides an answer. Polaroid’s dominance in the photography market can be compared to what Schumpeter called the circular flow, where “the same products are produced every year in the same way” (Schumpeter, 1934). In this case, photography was produced the same way for many years using instant cameras. However, like living things, inventions are bound by a life cycle, and sooner or later, the circular flow must be broken.
Schumpeter (1934) suggests that the breaking up of the circular flow starts with an innovation by an entrepreneur, which forever displaces the previously existing equilibrium state. In this case study, the invention that broke the cycle and forever changed photography was digital photography, which displaced Polaroid instant cameras and led to their demise.
According to Schumpeter (1934), innovations in the form of new products, the introduction of new production methods, or continual improvements in existing ones lead to the economic development of a country or region for the well-being of its inhabitants. In this essay, I will analyze how digital photography was the invention that shifted instant photography, leading to a new cycle of economic development. Likewise, I will analyze the social impact caused by this invention. Is it sustainable? Did it improve people’s welfare and make the world a better place?
A Glance at Digital Photography
Steven J. Sasson, an American electrical engineer at Kodak Company, built the first digital camera in 1975. His digital camera differed from Land’s camera in many ways; for example, instant photography was heavily founded on chemistry (Nagy Smith, 2011). However, the biggest difference is that digital cameras use solid-state image sensors to convert light into digital pictures, rather than capturing the image on film.
Sasson’s invention of the digital camera in 1975 began with an assignment from his supervisor at Kodak. Sasson was tasked with attempting to build an electronic camera. The result was a camera that weighed almost 4 kg and only had 0.01 megapixels. Instead of recording the image on film, it was recorded on a cassette tape with the capacity for 30 images; this process took 23 seconds (Friedman, 2011).
How Digital Cameras Work
Digital photography works with binary strings represented by 0s and 1s. These two digits translate to the individual pixels or basic units that combine to make up the complete image. When an image is captured using a camera, a CCD (charge-coupled device) creates an electron equivalent of the captured light, which converts the pixel value into a digital value. Once the picture is transformed into its digital version, it can be stored in the camera’s memory until it is downloaded to its final destination, which is usually a computer where the user can store, organize, delete, and manage all the pictures (Peres, 2007).
Commonly, the camera memory is in the form of a memory stick or memory card that, depending on its capacity, can store thousands of photos, eliminating the need to buy film.
The Impact of Digital Photography
It is clear that Sasson’s digital camera had many advantages over instant photography, especially in a changing market where customers abandoned printing and storing photos in heavy albums for a new way of taking and storing pictures, which enables them to carry hundreds of images in a lightweight device.
Considering the Schumpeterian theory (1934), Sasson became the entrepreneur who broke the circular flow of instant photography and facilitated the migration to the new era of digital photography. This also illustrates the Schumpeterian theory of creative destruction, where innovations impact the market by destroying the market share of older, less innovative companies. It’s simple: the Polaroid camera has disappeared, replaced by digital photography (Nixon, 2010).