In 2001, Jonathan Kaplan
and Ariel Braunstein noticed a quirk in the camera market.
All the growth was in expensive digital cameras, but the best-selling units by
far were still cheap, disposable film models. That year, a whopping 181 million
disposables were sold in the US, compared with around 7 million digital
cameras. Spotting an opportunity, Kaplan and Braunstein formed a company called
Pure Digital Technologies and set out to see if they could mix the rich
chocolate of digital imaging with the mass-market peanut butter of throwaway
point-and-shoots. They called their brainchild the Single Use Digital Camera
and cobranded it with retailers, mostly pharmacies like CVS.The concept looked promising, but it turned out
to be fatally flawed. The problem, says Simon Fleming-Wood, a member of Pure
Digital's founding management team, was that the business model relied on
people returning the $20 cameras to stores in order to get prints and a CD. The
retailers were supposed to send the used boxes back to Pure Digital, which
would refurbish them, reducing the number of new units it had to manufacture.
But customers didn't return the cameras fast enough. Some were content to view
their pictures on the tiny 1.4-inch LCD and held on to the device, thinking
they'd take it in later to get prints. Others figured out how to hack the
camera so it would download to a PC, eliminating the need to return the thing
altogether.