Global Camera Business Headed for Shakeout — Innovate, Die or Seek New Growth Drivers

The jury is out on the newest Olympus. The innovative camera maker, pioneering the Four Thirds and then Micro Four Thirds standards, angers trolls and pleases loyal users with its bold OM-D E-M1. Working photographers and pros alike, here’s an as matured as compact camera that “only the most neurotic pixel peeper will find anything to kvetch about”, says Luminous Landscape. Olympus may finally have conquered Moore’s law. It doesn’t matter much anymore how big a pixel and sensor is. The gap between imaging devices — cameras and smartphones alike — closes.

New imaging devices are less about performance differences than individual preferences and needs. Every camera delivers. In capable hands, an iPhone shines the way a $6,799 1D X can — hey, the Canon has only twice as many pixels, ‘Nuff said, ignoring that pixel count is only one of many factors that affect image quality. Yet this trend away from bulky “pro” gear has a vast impact on the photography industry.

Smartphone cameras are getting more sophisticated. Samsung’s Galaxy S4 is equipped with a 13MP sensor. Sony’s latest Xperia Z1 comes with optional zoom lens attachment. Nokia’s Lumia 1020 with a (downsampling) 41MP camera and Zeiss optics already attracts the attention of pro photographers — have a look at Nokia’s dedicated photography microsite.

Now here’s an interesting article on the topic. redOrbit asked fellow blogger colleagues Ken Rockwell and Steve Huff. The miniaturization of gear and democratization of photography is not about to replace professionals. But how about in a few years? Steve Huff:

Even though I always have my phone camera, I still use my traditional cameras for 95% of my shooting. But that is now, today, 2013. I suspect that within two to five years that there will be some incredible technology built into these devices where we may not really need or even want a dedicated camera, but… I am an enthusiast. I love cameras and I love old classic lenses. I love the tactile feel, the operation, the results and looking through a viewfinder. That is something I do not get with my smartphone.

Soon, these phones will have camera level quality built in. Photographers enjoying the camera experience will not become extinct. But will the market be large enough to keep camera companies afloat for the next 10 to 15 years?

Shifts from old to new gear are nothing new, says Ken Rockwell. The iPhone replaced the point-and-shoot camera for people’s snapshots (popular 1980s to 2005), which replaced the Instamatic of the 1960s-1970s, which replaced the Brownie of the 1st half of the 20th century, which replaced the original Kodak of the late 1800s.

But doomsday has arrived already for pro photographers, says Rockwell:

The digital camera replaces most pro photographers. Like milkmen, TV repairmen, watchmakers and horse-drawn buggy drivers replaced by newer technology, the pro photographers of the past exist mostly in people’s memories today. Sure, we still have milkmen and the others (a milk truck comes down my street every week), but we no longer have or need pro photographers like we used to. The few at the top will still be needed, but the guy you hired to take wedding or baby portraits or real estate listing photos is long gone because people can do it themselves easier.

Olympus builds world's best medical and biological microscopes. Now that's a market, not consumer cameras.
Olympus builds world’s best medical and biological microscopes. Now that’s a market, not consumer cameras.
So it comes as no surprise that the global camera business is headed for a shakeout, as Bloomberg reports in Smartphone Cameras at 41 Megapixels Pressure Canon, Nikon.

Sales of compact models have slumped as smartphones displace the point-and-shoots that were the biggest part of the market, we learn Now higher margin DSLR models — a market 80% controlled by Canon and Nikon — are slowing as well. Says a market analyst who recommends selling shares of both industry leaders:

There are too many players. It’s going to be tough for smaller camera makers even to remain in the business as competition between Canon and Nikon will likely intensify.

Camera makers need to seek new growth drivers — such as medical equipment that uses image capturing sensors and processors. Olympus, which started in 1919 as a maker of microscopes and thermometers, plans to stop SLR development, closed a Beijing camera plant this year and suspended its cheapest compact camera line. Since the tie-up with Sony in April the joint venture will focus on the development of medical equipment.

Fujifilm is shifting away from consumer cameras. Latest venture: Astalift cosmetics, combining the four basic film-related technologies collagen research, light analysis and control, antioxidation and original nanotechnology.
Fujifilm is shifting away from consumer cameras. Latest venture: Astalift cosmetics, combining the four basic film-related technologies collagen research, light analysis and control, antioxidation and original nanotechnology.
Fujifilm as well is shifting away from consumer cameras to medical systems and display components. Fujifilm in 2007 even founded Astalift, a new line of cosmetics developed using the company’s vast experience with film technology.

Cosmetics and film seem worlds apart, but Fujifilm simply applies the four basic film-related technologies collagen research, light analysis and control, antioxidation and original nanotechnology.

Nikon, founded in 1917, first supplied binoculars and optical gear to the Japanese military. Armed forces have deep pockets and still need optics. Today, Pentax’ military orders for scopes and binoculars are the company’s probably most profitable business.

You heard it a million times already, but the best camera is the one with you when needed.

Quite likely that Canon and Nikon miss the boat and fail to keep up with the changes of time. They’re under pressure to take risks to do something drastic. The future is here already — just to mention Google Glass and convergence devices.

Innovate. Or Die.

  • Harry Briels

    I wonder whether the future for the digital camera is in the smart phones?

    I have a smart phone and an iPad, but also a Sony RX1. I tried the smart phone and iPad, but they do not al all get even close to the RX1.
    In my viewnthe future is in state-of-the art digital cameras like my RX1, that generate excellent images, in an easy way and – which is I consider to be a key element – have “fine portability”.
    I can take my RX1 wherever I go and just have to carry less than 600 grams case and three batteries included!
    The heavy and large “SRLD-monsters” which Canon and Nikon do put out, that really are “computers with lenses”, do not deliver better quality images than the RX1, might not have much of a future. Cameras that are easy to use and especially easy to carry while offering top quality images could be the future!

    • callibrator

      Harry, you sound like someone with buyer’s remorse needing to justify the US$3k he or she just sunk in the camera without past and uncertain future, like RX1.
      You seem to direct your eulogy towards the DSLR’s and their doomed future. However your RX1 isn’t exactly that small and is under the very same pressure not only DSLR cameras are at this stage, but anything outside a spamrtphone category.

      • harry Briels

        Callibrator. Thank you for your reaction.
        Given the excellent results my RX1 delivers and its high portability, I am not at all regretting my purchase.
        Being in Europe I did not just pay $3.000 but including the EVF, Euro €3.500 which translates into $4.500!
        This is the first time ever I have a top quality camera with me most of the time because it is so pleasant to carry.

        In addition I feel that this is the best digital camera on the market if one’s goal is top image quality, in an easy to carry and to use package.

        I am coming from many years of Leica cameras and the M9 as my most recent one before I decided to purchase the Sony RX1. The Leica M240 was becoming too heavy with a Summilux 35mm lens over 1.200 grams!

        I strongly believe that good portability is in fact a major factor in selecting and using a camera.

        As far as phone shots are concerned have you ever thought about what happens to the billions of shots taken with phones all over the world? Most are just looked at after being taken, proudly shown to family and friends and that’s it most of the time.
        I wonder how many of these shots really end up in print or in an photo album? My RX1 shots do!

        It could be that the serious hobby photographer will never be satisfied by phone-shots and will continue using a camera. But his hobby will become far more pleasant when he will not be forced to leave his equipment at home when going on a holiday because of size and weight and then use his wife’s little camera.
        Harry

        • Bengt Nyman

          I agree with You Harry.
          There will always be cameraphone users, lots of them, and then there will be photographers. The two will never communicate, just argue. I see the future camera as a small, lightweight, sealed and inseparable body and lens with a comfortable grip and additional screw-on lens extensions for zoom and supertelephoto.

      • Marko Jovich

        You seem to have touched the nerve, there ;-)