The CP+ Interviews

(news & commentary)

In case you haven’t seen them, two digital photography sites did sit-down interviews with Nikon at CP+:

It’s always wrong to read too much into such interviews, as many are conducted through translators, and the companies obviously have party lines they want to establish in their contacts with press. Still, both are worth reading if you’re seriously into Nikon gear. 

Some comments:

  • The reason why companies keep pointing to weak growth in China as being a reason for lower sales is simple: market saturation. DSLR sales in the developed countries are pretty saturated: everyone that wants one has one. Thus, the DSLR sales in the US, for example, tend to be mostly replacement with a few younger folk moving up. What I look for in technology is Household Penetration Rates. In the US, that peaked in the 60 percent range for film SLR, and it looks like it peaked a little higher for DSLRs. But no question that it’s peaked. So the camera companies look for “new households.” You can find them in emerging markets, sometimes you can find them by thinking of the household need differently (which kind of explains the Nikon 1). China is still growing, just not that fast, so the “China isn’t growing and that’s holding back sales” line is a bit disingenuous. Household Penetration Rates would be lower in an emerging market to start with, but if households are playing their budgets tight, a DSLR would be one of the first things cut from the buying list. This is the Coca-Cola game: when growth halts in your home market, find a new market. Unfortunately, eventually you run out of potential new markets of any size. We haven’t quite gotten there yet with cameras, but we’re closer to that than most people realize. 
  • Don’t confuse “the US is the worst market for mirrorless” for “Nikon isn’t doing well in mirrorless in the US.” From the figures I see, Sony is #1 in the US and Nikon #2 in mirrorless in terms of actual sales to customers. It’s just that the US market isn’t particularly receptive to mirrorless cameras. We have the worst adoption rate of any geographic region. This notion that we “like big cameras” isn’t quite correct, either. I think the proper way to put it is that at a given price point, say US$1000, we’re more likely to take the product with 24mp and a fast AF system over a product with only 16mp and not-as-fast AF system. We don’t value the smaller size and weight as much as other markets. Note that this same thing was true when Japanese compact cars were introduced into the US market and is still true to some degree today in autos: the US buyer wants “best” and “feature-ful” first and foremost, we tend to have big garages and wide roads so size in one sense isn’t all that important as it might be elsewhere. It’s really only gas mileage that dictated our looking at smaller sizes. Put another way, you can make a mirrorless camera as big as a D800 and at the same price and we’ll buy it, but only if it performs better. We might buy it for a lower price if it performs about the same.
  • While I’ve written that 4K isn’t the answer, I don’t like Nikon’s answers regarding the 4K and video compression questions, as I think it shows a misreading of a critical leading edge market. Serious videographers are looking at 4K as a requirement (and higher bit rates and better color and bit depth). Why? Because they want to future proof their content. Have you ever looked at the old NTSC standard video (480i) on a 1080P TV? It looks crummy. A similar (but not quite as bad) a thing will happen when everyone is putting 1080P content on 4K monitors. That will happen in the future, but not today. In the critical market that wants high-end video in large sensor bodies, 4K and less obtrusive compression are now starting to become requirements. With the recent Mac Pro and Final Cut Pro X improvements, it is realistic to shoot and edit 4K today but output HD (or lower). 
  • I loved Yamamoto-san’s comment “If Nikon successfully makes the case that we have cameras that will allow you to [connect to social media] well, then people will step up to our cameras. Chant it with me everyone: Communicating, Programmable, Modular. Basically what he said was the Nikon needs to do the Communicating part. Phew. Five years of lobbying and we’re one-third of the way there! ;~) Still, I’m glad he heard my point. 
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