Interpreting An Interesting Week

(commentary)

With seven cameras and six lenses announced in five days, coupled with other recent launches, we're now seeing some clarity about how the camera makers are attacking the declining market. Believe it or not, new product launches that are interesting aren't done yet for this quarter. More interesting stuff is still coming.

Still, we've seen enough at this point to start making some conclusions about the market.

The Leaders
Let's start with Canon and Nikon: they aren't yet attacking the declining market, let alone being the ones to introduce interesting products. Here in the US they have over 95% of the DSLR market, and at least 85% of the interchangeable lens camera market, probably more. They will almost certainly use price as a lever in the upcoming Christmas buying season, serving them in two fashions: keeping the others at bay and cleaning out a lot of older generation inventory simultaneously. 

That's one of the joys of being number 1 or 2 in a market, and what Reis and Trout were onto well back into the 1970's: if you have enough market share and are at the top, you can use price as at least a temporary defense against your competitors. Quantity gives you cost advantages and visibility. 

So first conclusion: how aggressively you see price played by Canon and Nikon in their DSLR lines between now and the end of the year will tell you how much they think that they are under threat. Huge, across the board discounts and promotions would tell us that they see the market changing and they need to defend. Smaller, more targeted discounting would mean they aren't yet fearful of their competition. We'll see lots of discounting and promotions from the Big Two this selling season, just as we have in the past. But we may see more of that if they feel that the competition is heating up or that the market decline is too rapid for them.

Let me be clearer: the collapse of the compact camera market has consolidated Canon and Nikon as the #1 and #2 brands in cameras across the board. Previously, that had been Sony and Canon. Nikon very well may be about to take the #1 camera maker spot this year, mainly because they haven't lost as many sales in their Coolpix line as others have in their compacts, especially Sony. And, of course, in the historically most profitable camera line, consumer DSLRs, they are a strong #1 and #2. Here in the US, cash register receipts show Canon and Nikon running neck and neck in terms of DSLR sales this year.


The Competitors
Let's see what we have, shall we:

  • Sony (#3) targeting large sensor compacts (RX1R, RX100II, RX10), full frame via mirrorless (A7, A7r), and compact cameras via ill-fated QX models that are let down by their programmers.
  • Fujifilm trying to roll the X retro-design through their entire lineup: X20, XQ1 largish sensor compacts, X-E2, X-A1, X-M1 in mirrorless.
  • Olympus finally deciding that "small DSLR" is their target, with the E-P5 (with external EVF), OM-D E-M1, and an upcoming compact all taking on some variation of that.
  • Panasonic trying to take on the large sensor compacts with mirrorless (GM1) and the small DSLR mirrorless with rangefinder mirrorless (GX7), while mostly punting on compacts (rumor has it that they are considering pulling completely out of compacts, at least the definition of "compact" as we've seen in the past). 
  • Pentax has finally come up with a true D300 competitor. How long that will last is a good question. But there still are a lot of missing parts in the Pentax world at the moment. I get the feeling they're keeping the faithful faithful, but they aren't converting many new believers. 
  • Samsung taking an ill-advised detour through Android-land.


Notice one thing about all that? No one's directly targeting DSLRs. Even the "small DSLR" notion is really just mirrorless in another guise. If you can't beat the big players at their game, just change the game and beat them there, even if it is a smaller game (basic Reis and Trout strategy against #1 and #2 market leaders). 

Much of the new gear appearing from the competitors is darned interesting stuff, but every last company has some clear liabilities in the market:

  • Sony RX: expensive. Likely only to appeal to those who know what they really want in a small camera and have the disposable income to afford it. To a large degree, Sony RX is attacking Nikon Coolpix P (and A) and Canon Powershot G. I'd guess that Sony's all out salvo there is going to attract Canon's and Nikon's attention sooner rather than later. Bravo to Sony, though, as they've definitely upped the competition for the prosumer/pro's shirt-pocket, carry everywhere camera. But they're also telling Canon and Nikon what they should produce ;~).
  • Sony A7: incomplete. As I noted in my article at their launch, lenses are a liability. Sony is now trying more variations of lens lineups than even Nikon, who was getting excessive with CX, DX, and FX. Beyond spreading their lens work thinner, it's also confusing. Marketing needed to get ahead of this one and come up with some clear naming: Alpha E, Alpha FE, Alpha APS, and Alpha FF, or some such. Coupled with a clear chart of what works with what. I've already got the first "can X work with Y" email about this. There will be more.
  • Sony QX: execution. They sold the idea perfectly, they botched the execution big time. You only get one chance at a first impression, and Sony blew this one as bad as you can blow it. The reviews have all pointed out the foibles, many in gory detail. It just proves what Apple has been saying all along: great hardware needs even greater software (not that they've always delivered on that ;~). A Silicon Valley company with real software chops could take the QX down, I think.
  • Fujifilm X Mirrorless: duplicity. Why do we have an X-M1 and an X-A1? I'll have more to say about that in an upcoming review on sansmirror.com, but Fujifilm was a little too eager with getting a full model line. Now we also have X-E1 inventory when the better X-E2 is out, so Fujifilm is likely to be discounting the X-E1 right into the X-M1 territory. That's one of the problems happening in the DSLR market with declining sales: hanging inventory makes for too many model choices, making for buying confusion. Fujifilm needs to nip this in the bud. Clear the X-E1 inventory fast, and figure out what the real difference is between an X-A1 and X-M1 should be and produce it.
  • Fujifilm X compact: smallness. Both 12mp and 2/3" sensor are a bit below the mark where the competition is concerned. Not to mention X-Trans weirdness for those shooting raw (ready to change your workflow because of a sensor?). Otherwise great cameras (X20 review coming soon on gearophile.com), but as more players pile onto the carry-every competent camera hill, lightweight specs will look increasingly problematic, I think, and not likely to get you king-of-the-hill status.
  • Olympus: uniformity. Quick, what's the difference between an E-P5 with the EVF, the E-M5 and the E-M1? They're the same basic bones, muscle, and organs with slightly different skins, and they look at lot like brothers born a year apart. You're going to see just how far Olympus has erred with this before the end of the month, when they try to copy themselves again, only smaller. Only this time they forgot the muscle and changed the organs. Basically, I see no reason to buy anything other than the E-M1, except maybe the E-M5 if the price differential becomes big enough.  In other words, they're competing with themselves. 
  • Panasonic: lag. The real problem for Panasonic is that, besides competing with all the rest of the companies in the camera world, they are locked into direct competition with Olympus. Olympus just seems to be pushing faster into better sensors, better focus, better rendering, better…well you get the idea. So unless the Panasonic version of a camera is way, way better at something, it looks like it is lagging against Olympus, let alone the rest of the players. The GH3: great as a video camera, but that's not the market we're talking about, and that's a smaller market to start with. The GX7: looks good against the E-P5 but perhaps not against the E-M1, so it's another of those pricing-dependent wins. The GM1 looks like it might be ahead of the large-sensor compact market, though, at least temporarily. Panasonic needs more of that. 
  • Pentax: lag. Still playing the DSLR game with almost none of the market share (about 0.6% this year in the US). Still not playing in full frame. Taking the compact route to mirrorless. I really like some of Pentax's products, but most of them don't feel "leading edge" enough to be compelling. The original collapse of the Asahi owners and the two takeovers of the camera group have Pentax still playing catch up, and even when you catch up that's not the same as "getting ahead."   
  • Samsung: lost. No one has shown them how to beat Canon and Nikon, so they wander the land of Android in search of ideas. With Sony giving up the NEX branding, how soon will Samsung stop calling things NX? ;~)


Putting it All Together
Of all the recent announcements, the ones that resonate the most with me are Sony's RX and Fujifilm's X mirrorless. 

I've now used and tested three of the four RX and my RX100 has accompanied me most of the time in the last year or so. It's a really nice blend of performance, quality, features, and ability in a very small package. A more well-rounded blend than things like the Nikon Coolpix A or the Ricoh GR, though those are nice products, too. We've entered the age where not having a carry-everywhere camera capable of high quality imaging means you either haven't been paying attention or you don't have the money to afford one. Plenty of choices now, and Sony has been the most aggressive there so far. As someone pointed out to me, The RX100 is the leading point and shoot used in Flickr galleries now. 

I was shooting with the Fujifilm X-A1 mirrorless this week, and almost everything I liked about the X-Pro1 and X-E1 has managed to come through in this entry model. Pity there isn't an optional EVF you could add later, but for the arms-out crowd this is a nice camera that clearly has the same thinking in it that made many of us like the higher end Fujifilm bodies. I'm impressed that Fujifilm has managed to expand the line so fast, get enough lenses out to have meaningful choice, and not botched anything up badly in the process. It seems clear that there are photographers in charge at Fujifilm, and that shows in what they let get through into designs and what they don't. Do we need a full frame X mirrorless? No, not really. If you can't get 13x19" prints out of the APS X's that are really nice, then full frame ain't going to help you.

I'd go further. You have lots of choice coming into this buying season. Lots of choice. An incredible amount of choice amongst some very great cameras. Let me put that in perspective. If this were just three years ago—2010—how many kidneys would you have given up to have any of the following cameras:

  • Nikon D7100, D600, D800, Coolpix A
  • Sony RX1, RX10, RX100, NEX-6, NEX-7, A7, A7r
  • Fujifilm X-A1, X-E2, X20, XQ1
  • Olympus E-P5, E-M1, E-M5
  • Panasonic GH3, GX7, GM1
  • Pentax K-3, Ricoh GR


And that's just the cream of the list. Every one of those should be able to create 13x19" prints that are beyond just being good, when used well. Do you really need more?

While we live in interesting camera times, don't let that distract you. The goal is photos. You can get flummoxed by antagonizing over small differences—and yes, even sensor size is mostly a small difference in some comparisons—and forget that the goal is to take photos. That requires lenses. That requires controls. That requires focus performance. That requires seeing what you're shooting well. A lot of the announcements this week address only some of that. In choosing from all the new gear make sure that you're getting the balance of things right, both now and in the future. 

© Thom Hogan 2013 / All Rights Reserved bythom.com  @bythom #bythom