Will They? Won't They?

Discussion in 'Open Gear Talk' started by olli, Apr 21, 2011.

  1. olli

    olli Super Moderator Emeritus

    Sep 28, 2010
    Metro Manila
    Real Name:
    olli
    [​IMG]

    Olympus, Panasonic, Samsung, Sony. As the range of mirrorless compacts grows steadily and sales of these cameras grow rapidly speculation continues regarding the position of the two big names - Canon and Nikon - in this market.

    Mirrorless Rumours recently drew attention to a report in the UK based photography magazine, Amateur Photographer, of an interview with Simon Iddon of Nikon UK. He played down the significance of the compact system camera (CSC) arguing that these cameras were eating into the compact market rather than the SLR market. He also commented that Nikon already had 'all points covered with a complete range of cameras.'

    Mirrorless Rumours also linked to a recent interview with two executives from Canon Europe on the Spanish photography website Quesabesde. Discussing the possibility of a Canon CSC the response from the Canon people is almost identical to that of the Nikon executive: 'The idea is that we do not need CSC because our current range covers all fields.'

    On the face of it that sound like a definitive no to the idea. Yet somehow these arguments fail to convince. Despite Nikon's claim that CSC's are not impinging on the SLR market, sales evidence suggests otherwise, especially in the the Asian markets and in the UK.

    This is the real dilemma for Canon and Nikon. CSC's are already eating into the market for low budget DSLR's and as these systems evolve and mature it is reasonable to expect that they will do so more and more. It is precisely these lower end DSLR's - the D3000 and D5000 series' from Nikon and the Rebels from Canon - that are the big sellers and undoubtedly the big earners for both companies. Yet, on the one hand, if Nikon and Canon sit tight and pursue their current strategy they risk seeing further erosion of their sales as the CSC market expands. On the other hand, if they enter the CSC market, they risk cannibalising their own DSLR sales in a market they dominate while entering a market where they are no longer the default choice for most people and the competition is much tougher.

    Yet they may have no choice. As Thom Hogan puts it:
    So when will we see CSC's from Canon and Nikon? There have been plenty of rumours on respectable sites of a forthcoming Nikon CSC (though most of them also predicted an April launch), but nothing credible for Canon. The longer they wait, though, the greater the challenge will be. Both may have extensive DSLR systems available to cover almost every photographic eventuality but the assumption that once Canon or Nikon bring out a CSC they will inevitably dominate the market is false. The size of their current DSLR systems is irrelevant. In the CSC market both will be starting from scratch and taking on competitors with mature products and expanding systems.

    Whatever the timescale the end results can only be good for consumers of CSC's. More competition means more innovation and pressure on cost. We should see better, more innovative cameras and accessories at competitive prices.
     
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  2. bilzmale

    bilzmale Super Moderator Emeritus S.C. Charter Member Subscribing Member

    Jul 17, 2010
    Perth, Western Australia
    Real Name:
    Bill Shinnick
    Bloomberg has released total market share figures for 2010 (and compared to 2009) as listed at 43 Rumors. These do not give a breakdown to show DSLR or CSC percentages unfortunately and include a healthy number of P&S fixed lens cameras. As expected Canon has the lead with 19% (19% 2009) followed by Sony 17.9% (16.9%) with Nikon back in third but improving to 12.6% (11.1%).

    There may be reason for complacency by CaNikon at the moment and they dominate Japanese DSLR + CSC sales figures for April 11-17th with Canon filling 6 of the first 10 places including 1st and 4th; Nikon holding 2nd and 3rd and CSC's coming 5th (NEX5) and 6th (GF2).

    With the 4/3 segment already abandoned by Panasonic and almost abandoned by Olympus we can expect growth in the micro 4/3 segment by these players. I think Canon and Nikon will sit and watch a while longer
     
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  3. olli

    olli Super Moderator Emeritus

    Sep 28, 2010
    Metro Manila
    Real Name:
    olli
    Canon more or less said as much in the interview: they would watch the market and see what happens. The challenge for them is judging the timing right.

    The CSC makers also need to keep working - new products, expanding systems - otherwise they could lose the impetus they have built up.

    The Bloomberg. do have a breakdown for ILC cameras but don't distinguish between DSLR and CSC. In this segment Canon have a huge lead: 44% to Nikon's 30% with Sony on 12% and the rest - presumably a significant proportion being M43 on 13%.

    Canon are certainly doing well and can perhaps afford to wait and watch more so than Nikon. But even apparently strong or dominant market positions can disappear relatively quickly, as Nokia has been finding out in the last couple of years.
     
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  4. BBW

    BBW Administrator Emeritus S.C. Charter Member

    Jul 7, 2010
    betwixt and between
    Real Name:
    BB
    Thank you for this, olli - and Bill for your follow up post. I know that you and David/soundimageplus didn't plan your two articles - so it must be great minds thinking alike because they certainly compliment each other beautifully!
     
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  5. BBW

    BBW Administrator Emeritus S.C. Charter Member

    Jul 7, 2010
    betwixt and between
    Real Name:
    BB
    The more I think about this "will they or won't they", thanks to your portrayal, the more I am reminded of a political campaign. Each is guarded and watchful, waiting and trying to time their next moves.
     
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  6. soundimageplus

    soundimageplus SC Top Veteran S.C. Charter Member

    578
    Jul 6, 2010
    Good piece. I enjoyed that.

    I really did have hopes that Nikon might get involved with CSC's because they would (probably) do it well. I guess their (sort of) answer is the D5100, which looks a pretty neat little thing.

    I'm not sure either are that keen to get involved, and I feel they only will if they really have to. Samsung and Panasonic had nothing to loose, Olympus were halfway in with 4/3 and Sony are just voracious and keen to eat into the big two. (Quite succesfully it seems, since we now have a big three.)

    Its not a good time to risk something new anyway, recession followed by disaster are hardly the conditions to go out on a limb. And I think it is going out on a limb. Olli is right about the maturity of the existing systems. M4/3 has a decent set of lenses, and it won't be much longer before both Samsung and Sony do the same.

    There's a notion going around that Canon and Nikon only have to come into CSC and they will immediately conquer the market. However I don't think thats true and I don't think they do either. Both companies know what its like to be successful, but they also know what its like to loose market share.

    It struck me that there was a lot of bravado in the statements from both, and I could imagine them crossing their fingers and whispering "We hope" under their breath. No company gets it right all the time, just look at Apples roller coaster ride, and certainly no company is invulnerable, even if in a seemingly dominant position.

    Ultimately do we need Canon and Nikon to make CSC's? There's absolutely no guarantee they would do it any better.
     
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  7. olli

    olli Super Moderator Emeritus

    Sep 28, 2010
    Metro Manila
    Real Name:
    olli
    Thanks David. I agree that there is a certain amount of bravado in regular comments for the Canon and Nikon reps. Of course they have to have a response because it is inevitable that they get asked the question. But to state, effectively, 'we don't need to do this' rather than going for some non-committal open ended comment seems to suggest a certain nervousness. I also agree that this is something they will do if the feel they need to for commercial reasons rather than because they want to.

    I didn't mention Pentax of course who also have a rumoured CSC coming.
     
  8. soundimageplus

    soundimageplus SC Top Veteran S.C. Charter Member

    578
    Jul 6, 2010
    Agreed. It was a strange way of reacting. The usual response is something bland like:- "We have no plans to do that at the moment but we're not ruling anything out." But both Canon and Nikon took a somewhat surprising "bullish" attitude.

    Yes you're right about Pentax. I think it would be a great move for them. They have already got the wonderful pancakes and the limiteds. All they need is a decent APS-C body (and they are good at small) and to persuade Sony to let them get their hands on that rumoured 24MP sensor and hey presto they have a very classy upmarket system. Particularly if they use some of their wonderful old designs. An interchangeable lens X100.
    The only problem is Pentax take forever to do anything.
     
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  9. summerkl

    summerkl SC Veteran

    374
    Oct 11, 2010
    Vancouver, Canada
    Real Name:
    Kevin
    It certainly is interesting to speculate on Canikon's plans.

    I can see how Canon can take their time as they dominate the DSLR and compact markets with their excessive product offerings - they seem to be following the old cereal business model where constant "improvements" and numerous iterations of the same formula keep competitors at bay who can't afford the marketing and development pace.

    As for Nikon, they seem to rely on a loyal following and have less presence in the digital compact offerings. I have used several of their non-SLR cameras over the years and have been underwhelmed. I suspect their engineering teams are somewhat stagnant and are unable to finance or justify the launch of a CSC.

    For me, having used the Olympus e-pl2, the Sony Nex, and now the Sony SLT series, the question of "will they or won't they" boils down to what the "next generation" of photographers want. My kids, nephews and nieces (18 of them from ages 16-30) place a premium on compactness and less so image quality. There are a couple that want better quality and use dSLRs. By no means a scientific sample, but I would guess not too far off from general trends.

    With that in mind, I don't think the m43 and then NEX lines fit their definition of compact. Therefore, I wonder if these systems will grow beyond a niche market. As to the higher quality of these systems, I expect continued improvements in the digital compacts such as the Olympus XZ1, Panasonic LX5, Canon S95, etc. that will more than satisfy the next generation's needs.

    Long story short, I'm guessing they won't
     
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  10. Amin Sabet

    Amin Sabet Administrator Moderator

    Jul 3, 2010
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