Film Details

Impact of Digital Cameras On Rate of Growth of New Photographs

80 billion new photographs are taken around the world every year. Photography generally follows the trends of the overall economy, for example, in the mid-1990's there was a slight slowdown in photography concurrently with the economic recession experienced in many major world economies, particularly those in Asia. However, it is expected that in the next five years there will be continuing growth in the overall number of photographs as the enormous potential of China, India and other developing regions is realized. At the present 25% of film sales occur outside of North America, Western Europe and Japan. In June 2000 Kodak announced that China was its second largest market after the United States. To give some perspective to the growth potential for photography in China, film usage there is currently less than one roll per capita as opposed to 3.6 rolls per capita in the United States. Similarly, only 15% of Chinese households own cameras as opposed to over 80 percent in the United States.

A countervailing trend to the growth of silver halide film based photography is the increasing popularity of digital photography. Very rapid growth is predicted over the next five years for this method of taking pictures. In 1999, in the United States almost 2 million digital cameras were sold, double the number from the year before and representing about 12 percent of all cameras sold. In a survey by NPD Intellect, more than 70% of consumers planning to buy a new camera say they will choose a digital one. Kodak projects that digital photography will account for forty-five percent of its revenue by 2005 from a current 17%.

Photofinishing News and Lyra Research predict that there will be an 80 percent growth in the number of digital cameras worldwide by the year 2002. There were 8.3 million digital cameras in use worldwide in 1999 according to this study. (compared to 200 million conventional film cameras in the United States alone). Salomon Smith Barney predicts that the growth of photographic exposures worldwide will grow from 71.4 billion in 1997 to 96.8 billion by 2002. At the same time, they expect digital camera exposures to grow 1500 percent. Many of these photographers will use web photo services. For example, Photo Works already hosts over 100 million images on its web site and there are many more companies competing in this same market. These companies indicate that at this time 60 to 80 percent of the photographs on their web sites are scanned from silver halide film.

Kodak predicts that the growth trend will predominate until at least 2004, at which point traditional film will gradually decline in use as the digital camera becomes ascendant.

The Internet may actually be increasing demand at the present for traditional photographs points out Morgan Stanley Dean Witter. eBay has 4 million items for sale every day and the inventory turnover averages about 7 days. About 80 percent of these items are accompanied by a photograph. About one-half of one percent of current U.S. photographs are pictures of merchandise offered for sale on eBay.

Table 1: Photographic Exposures (Billions)
Year:	1992	1997	1998	1999	2000	2001	2002	2005
World	56	84.4	83.3	82			89
US	21	24.9	26.9		34.4			41.2

Source: 1992 statistics are from U.S. Industrial Outlook 1994; 1997 and 1998 U.S. Statistics are from U.S. Industry and Trade Outlook 2000; 1997 and 1998 world statistics are from the Silver Institute. The 1999 world figure is from Kodak's corporate web page. The 2000 U.S. figure is from Kodak and printed in May 8, 2000 Wall Street Journal. The 2002 projection for the world is from the Silver Institute. The 2005 projection is from the May 8, 2000 Wall Street Journal article and attributed to Kodak.

Chart of the annual production of film used in conventional photography in the United States.

Conversion and Compression

Photographs

To assess the amount of data in terms of bits in a photograph, certain assumptions must be made about the size of the film used and the technical way in which the photograph is digitized and stored. Professional photographers generally use physically larger film formats with more chemical grains on the film to store information than do amateur photographers. Conversion of these professional photographs to a digital medium, therefore, generates a much bigger computer file. For example, high quality professional photographs may require 40 megabytes or more of storage space.

In the early 1990's Kodak introduced the PhotoCD format for the storage of photographs on compact disks. Since then, the format has been widely used by consumers, professional photographers and archivists. Kodak estimates that most photographs can be converted to its PhotoCD format with little to no loss of image data in 5 megabytes. Kodak's rule of thumb is that it can place 100 photographs on one CD, which holds approximately 650 megabytes. For the sake of carrying out our estimates of total photographic data, therefore, we use this same 5 megabyte figure.

Of course, actual digital storage of photographs might consume far less space if any of the very popular compression schemes are used. For example, the JPEG standard is commonly used to reduce photographic file sizes to one-tenth of their original size. However, this is a "lossy" compression, i.e., one where data is irrecoverably discarded in the compression.

The 5 megabyte conversion factor used is also supported empirically by the extensive image digitizing experience of the University of California, Berkeley Digital Library. The photographic collection there is reported as containing 164,702 images which require 888 gigabytes of storage space, or just over 5 megabytes per photograph. (http://elib.cs.berkeley.edu/admin/rpts/TestSuite/00q2.html)

Motion Pictures

The conversion of motion pictures to digital media can result in very large file sizes. It is estimated that each frame of film can be digitized in about 12 megabytes. However, to create the illusion of seamless motion, 24 images are used per second of film. Thus, one second of film requires 288 megabytes of digital storage, one minute requires 17.28 gigabytes, and one hour requires 1 terabyte. At this rate a feature length film of 100 minutes would fill about 400 typical DVD's. Fox Animation Studios, for example, reports that its animated feature "Anastasia" is 1.49 terabytes in size. This particular film was digitally inked and painted and only then transferred to film for theatrical distribution.

In cases where film will be distributed or stored on digital media such as DVD's some form of compression must be used to make the file sizes tractable. The most common compression format now used for motion pictures is MPEG-2. Using this format, a feature lenth film can be reduced to several gigabytes in size and placed on a single DVD. This is a "lossy" compression format where data that is present on the film is irrecoverably lost in the compression process.

X-Rays

The conversion of x-ray images to bits requires careful attention to the loss of information because of the attendant risk of harm to patients. See, The Economist, "Why JPEG's Can Be Bad For Your Health", June 2000, citing a study published in the Journal of the American College of Cardiology in which researchers found that using JPEG with a compression ration of 16:1, the error rate was 30% higher than for uncompressed images. In fact, in the United States conversion of x-rays to digital format is regulated by the U.S. Government for the protection of the patients. FDA Regulation 510(k).

1 chest X-ray = 1 megabyte (14 x 17 inches), 150 dpi, 12 bits (compressed). 12 bits per pixel, provides 4,096 shades of grey) (wavelet compression, lossless mode, has FDA 510(k) approval) 150 dpi, 12 bit images recommended by American College of Radiology for primary reads). (Source: Steve Gilheany, Archive Builders )

A team of radiologists from the University of Florida estimated the size of a converted conventional radiograph as 10 megabytes assuming a matrix size of 2048 x 2580 pixels with a 16-bit sample of each pixel. This estimate assumes there will be no compression. Honeyman, Huda, Frost, Palmer & Staab, "Picture Archiving and Communications System Bandwidth and Storage Requirements", Journal of Digital Imaging, Vol. 9, no. 2, May 1996.

A slightly smaller estimate of the amount of storage required for a standard chest x-ray comes from the University of Pittsburgh, Clinical Multimedia Lab, which estimates the size for a radiograph (2K * 2K * 16 bits) as approximately 8 megabytes (uncompressed). Clunie, David A., Lossless Compression of Grayscale Medical Images - Effectiveness of Traditional and State of the Art Approaches (Link to this paper (PDF))

This latter figure will be used because it does not assume compression and is generally consistent with the assumptions made for converting traditional photographic film to digital format. Furthermore, Dr. H.K. Huang, Radiologist at UC San Francisco, estimates that "a typical examination generates betwen 10 and 20 MBytes." Huang, "Teleradiology Technologies and Some Service Models" Computerized Medical Imaging and Graphics, Vol.20, No.2 (1996). Applying this assumption of 8 mb per x-ray image results in a total amount of data stored on x-ray film of 16 petabytes.

Flow of New X-Rays

There are three common uses of x-ray film: medical imaging, dental imaging and non-destructive testing in manufacturing processes. The Silver Institute Reports that the medical uses of x-ray film overwhelm the other categories, accounting for 92% of the world's overall x-ray film usage.

Medical Imaging

The administration of radiologic procedures in the United States and the developed world are fairly well documented. The number of such procedures in the developing world, however, are harder to come by. The United Nations Scientific Committee on the Effects of Atomic Radiation found that no data at all could be found for radiological procedures for half the world's population and that there is only fragmentary data on examination rates for another quarter of the world's population.

Table 2: Medical X-Ray Procedures in United States
1992	1993	1994	1995	1996	1997	1998	1999	2000
275	280	286	291	297	303	309	315	320

Source: Theta Reports

The UN Committee observed that the developed nations of the world use x-rays at a rate generally consistent with that of the United States, i.e., approximately 1000 procedures (including dental uses) for 1000 population. Therefore, on the assumption that the developed world's population is 1.2 billion, then a rate of x-ray procedures of slightly more than one per person per annum would yield approximately 1.2 billion x-ray procedures per year in the developed world. The population of the less developed world is 4.9 billion. If it is assumed that there are another 0.5 billion x-ray procedures performed for this population, a rate one-tenth that of the developed world, then the world total of annual medical and dental x-ray procedures is 1.7 billion.

According to Clinica Reports and Theta Reports, the world market for x-ray film is approximately $3.5 billion per year with the United States market accounting for around $1.4 billion of that total amount, a 40% share of the world market. If the dollar share of the market is reflective of the share of procedures performed than there are about 750 million x-ray procedures annually. On the other hand, it is reasonable to assume that film is sold for less in dollar terms around the world than in the United States. If it is assumed that the price of film in other markets is 50% of that in the United States, then this would work out to about 913 million x-ray procedures outside of the U.S., and around 1.2 billion for the entire world.

Another approach to verifying these estimates is to take into account the use of silver for the production of x-ray film as estimated by the Silver Institute. In 1998, 71.5 million troy ounces of silver were used for medical x-ray film and that was sufficient to produce 387 million square meters, or 4.2 billion square feet, of x-ray film. This implies that one ounce of silver is enough to produce 5.4 square meters, or 58 square feet, of medical x-ray film. Theta Consulting estimated U.S. consumption of 1.7 billion square feet of medical x-ray film to perform 309 million procedures in 1998, indicating usage of an average of 5.5 square feet of film per procedure. If the same amount of film were used per procedure in the rest of the world, 450 million medical x-ray procedures were performed there. This is consistent with a world wide x-ray procedure total of 750 million.

We have chosen to estimate the total number of world medical x-ray procedures at 1 billion annually as a reasonable balance of the available statistics and assumptions discussed.

In order to determine the actual number of x-ray images taken some calculation must be made based upon the average number of films taken per procedure (more than one image may be captured on one film). In fact, the number of films used per procedure varies considerably. If 2 films are shot for each x-ray procedure, there are approximately 2 billion x-ray medical images taken worldwide every year.

Other X-Ray Uses

The other major uses for x-ray film are dental imaging and the non-destructive testing of materials in manufacturing and fabrication processes. These uses are approximately 8 percent of overall x-ray film usage in developed nations according to the Silver Institute. Accordingly, based upon the finding of 2 billion x-rays for medical purposes, then industrial and dental uses would amount to 160 million x-rays in the developed world for all purposes. The total world use of x-ray film is therefore approximately 2.16 billion images annually.

Copies

As more photographs are digitized through inexpensive home scanners or are taken on digital cameras in the first place, it is not yet clear how often paper copies will be made. Furthermore, it is still unknown whether output from digital storage will typically be on photographic paper, or by means of ink jet or thermal printers. Current indications are that ink jet printing will be the most common process. In the year 2000, it is estimated that United States consumers will print out 5.4 billion photographic pictures, mostly at home. By the year 2005, this will quadruple to 26 billion. At the same time, traditional photoprocessing is expected to grow only 20 percent to 41.2 billion prints. (Source May 8, 2000 Wall Street Journal.)

The most common use made by consumers of digital images so far has been sharing them through e-mail. Similarly many new businesses are counting on the consumer's desire to share digital photos by hosting them on web sites. In December 1999 there were over 25 million unique home visitors and 12 million work visitors to the web sites of over one hundred companies providing photographic hosting services.

It is anticipated that the growing number of digital images owned by consumers will have a dramatic impact on their need to consider making backup copies of their personal disk drives. Traditionally, only a small percentage of home computer data is original data that requires backup at all. This need will grow dramatically if many photographs are stored digitally. The web hosting companies are counting on consumers storing the data on their sites and ordering prints from time to time. Currently, consumers are able to get free photo developing and unlimited disk space from these companies.

Copies of Motion Pictures

The Wolfman Report on the Photographic & Imaging Industry in the United States states that the average number of prints per original motion picture is 700. The Silver Institute, however, reports that 6,000 release prints are made for each feature movie. Interestingly, however, these copies are short-lived. 98 percent of all films for theatrical distribution made in the United States are destroyed by FPC, Inc.of Mountain City, Tennessee. After the films are no longer being shown in movie theaters, they are sent to FPC, which destroys10 million pounds of film every year. The film is shredded and sent to FPC's parent company, Kodak, where it is recycled and made into new film or fuel used in power plants. (Source: Associated Press)

Film Factoids

Kodak describes the photography market as follows: 82 billion pictures processed a year throughout the world with 750 million rolls of film processed annually in the United States and 2.9 billion rolls consumed worldwide. Kodak also estimates that of the photographs that are processed approximately 2 percent are later reprinted or reused in some way.

SOURCE: http://kodak.com/US/en/corp/georgeFisher/shihPres.shtml, Presentation to Imaging Technology Analysts Group on February 24, 1999. by Willie Shih, President, Digital and Applied Imaging, and Vice President, Eastman Kodak Company.

More than 82% of U.S. households have cameras and use them to take over 17 billion pictures annually. It is estimated that there are over 150 billion photographs stored in those households. "Instant Images" Fortune, Winter 1997 (Technology Buyer's Guide Supplement) 184-187. This article cites these figures as according to the Photo Marketing Association.

According to Kodak, China has become its second largest market. The per-capita film consumption in China averages one roll a year, as compared with 3.6 rolls in America. Only 15 percent of Chinese own cameras. (XINHUA ECONOMIC NEWS SERVICE, 6/13/00).
The United States Library of Congress reports that it holds 12 million photographs in its collection.
Number of UK Feature Films Produced Annually (1912-1998)
The Department of Commerce cites the journal Medical Imaging for the statistic that "U.S. health care systems spend up to $7 billion a year on film alone." U.S. Industry and Trade Outlook 2000, 44-18. Unfortunately for the film manufacturers, this probably overstates the amount of sales by a wide margin. Theta Reports puts the sales of x-ray film at $1.4 billion in 1996 and expects it to reach $1.5 billion by 2000.
American women undergo approximately 30 million mammograms annually. Medical Industry Today, December 20, 1999.
Approximately 150 million chest x-rays are done in the United States each year.(Source: University of Pittsburgh, Clinical Multimedia Lab).
The Silver Institute reports that 92 million ounces of silver was used in 1999 for radiography throughout the world. This association also reports that dental and commercial uses of x-ray film traditionally account for about 8% of the total radiography market.
In 1996 it was estimated that the average institutional radiology department would generate approximately 15.7 gigabytes of data per day and 3.5 terabytes per year. Honeyman, Huda, Frost, Palmer & Staab, "Picture Archiving and Communications System Bandwidth and Storage Requirements," Journal of Digital Imaging, Vol. 9, no. 2, May 1996.
Production of x-ray film is essentially controlled by three companies: Kodak, Sterling Diagnostic Imaging/Agfa and Fuji Medical Systems. The U.S. market for x-ray film is about $1 billion annually. Modern HealthCare January 18, 1999.
"More than 32.5 million mammograms and 4.5 million cardiac catheterization procedures are performed each year in the U.S., and X-rays account for 70 percent of all medical imaging procedures." PR Newswire, Feb. 29, 2000, " New GE Digital Imaging Technology"
Kodak sells about $800 million year in x-ray film. Associated Press, Nov. 26, 1999. This also seems to suggest that the statistic cited above is incorrect as to the overall U.S. x-ray film market.
"The reduction in the number of competitors is clearly seen in the medical X-ray film market. In 1995, there were five global players: Du Pont, 3M, Kodak, Fuji and Agfa, sharing approximately 90% of the world market. In 1996, Du Pont sold its X-ray film business to Sterling, which subsequently announced the resale of the business to Agfa in January 1999. The imaging division of 3M was spun off into a new company, Imation, in 1996, and this was subsequently purchased by Kodak in August 1998 for US$520 million. There are now only three major players in the global market: Kodak, Agfa and Fuji, assuming that the Agfa/Sterling deal is approved by the US FTC and the European Commission. This obviously leads to dominant companies with market shares in excess of 40% in some major markets. Further consolidation of these groups, however, would almost certainly run into legal difficulties." Medical Device Technology (May 1999), Vol 10, no. 4
"Greater volumes of products and hence bargaining power are being concentrated into the hands of a declining number of purchasers. The greater volume and value involved with each negotiation mean that the market-share impact of either winning or losing a contract will increase. This can lead to a decline in prices, as witnessed following the merger of Columbia and HCA, which was widely considered to have started the rapid decline of film prices in the US market between 1996 and 1998. Prices fell by more than 20%, wiping approximately US$150 million per annum off the value of the US X-ray film market." Id.

Film References and Sources

Photo Marketing International: http://www.pmai.org/
Photo Marketing Magazine: http://www.photomarketing.com/
Berkeley Digital Library Sunsite: Digitizing Imaging and Text: http://sunsite.berkeley.edu/Imaging/

Reference Books
The Photography Encyclopedia (call number TR9.M39 1999)
Journal of Electronic Imaging (TK8315.J68)
NAICS 512110 Motion Picture and video production
SIC Code 7812 Motion picture and video production
The Film Encyclopedia
Guinness Book of Movie Facts and Feats
International Film Guide
Screen International
Screen Finance
Screen Digest
The Motion Picture Guide Annual 1999
The International Film Index, 1895-1990, edited by Alan Goble published by Bowker-Saur (London: 1990).
The Silver Institute
Theta Reports, X-Ray Film Markets, Report No. 671, January 1997
University of Pittsburgh Clinical MultiMedia Lab
United States Government, U.S. Food and Drug Administration, Center for Devices and Radiological Health
United Nations Scientific Committee on the Effects of Atomic Radiation, Reports to the General Assembly, (New York 1993, 1994).