Their problem was that they were fundamentally a chemicals company. They weren't as good as consumer electronics as the Japanese consumer electronics companies, and they weren't as good at the web as Silicon Valley web companies.
And, ultimately, they wanted to milk the chemical film business as long as they could and perpetually overestimated the popularity of film cameras versus digital.
That reminds me of a passage from Robert Caro's Master of the Senate:
"Vote-counting" -- predicting legislators' votes in advance -- is one of the most vital of the political arts, but it is an art that few can master, for it is peculiarly subject to the distortions of sentiment and romantic preconceptions. A person psychologically for intellectually convinced of the arguments on one side of a controversial issue feels that arguments so convincing to him must be equally convincing to others. And therefore, as Harry McPherson puts it, "Most people tend to be much more optimistic in their counts than the situation deserves... True believers were always inclined to attribute more votes to their side than actually existed."