A long time ago (in a galaxy far, far away, or 2014, as most would call it), when I first started writing about photography, I created an article on my photography predictions for 2015.
In that article, I wrote about how one or more manufacturers would stop producing cameras. I specifically named Olympus (and Pentax) as companies I could see not surviving long-term. My prediction has unfortunately come true with the recent Olympus sale (six years later, but I was still right!).
This history lesson shows two things:
- Talk of camera manufacturers not surviving has been around forever.
- Eventually, some camera companies will fall victim to the ever-shrinking photography market.
After years of rumors and denials, June 2020 saw the sale of Olympus to Japan Industrial Partners (JIP). This is the same firm that acquired Sony’s VAIO PC business back in 2014. It now seems (although it’s yet to be confirmed) that JIP will most likely be dropping the name “Olympus.”
The sad loss of Olympus shows that digital cameras are an ever-decreasing market and begs the question:
Is Olympus a one-off? Or is the Olympus sale a sign of things to come?
A small caveat
For this article, I will simply concern myself with digital camera divisions. I know that companies such as Nikon and Canon have huge businesses outside of cameras, but that doesn’t mean they won’t close their digital camera divisions if they become financially unviable.
What is happening to digital camera sales?
Digital camera sales are still in decline.
To give you a sobering statistic, over 98% of all digital cameras sold are smartphones. As cameras in phones continue to improve, the small percentage of compact digital camera sales will more than likely continue to shrink to zero.
But there will always be a market for more serious digital cameras. Such cameras are aimed at those of us who enjoy photography beyond a snapshot. For those who photograph either for a hobby or an income, there will always be the need for a larger camera with more advanced features.
That said, figures are continuing to trend downward and are not looking good. There are Japanese analysts who are saying that, unless the industry rapidly changes, it will begin to collapse. How true this is depends on several factors, but one thing is for sure:
We are heading toward rock bottom.
The Corona effect
A recent report by Slackline showed that the camera industry has been hit incredibly hard by COVID-19. The camera market came in at number three on a list of the top 100 fastest-declining e-commerce categories in 2020 (only beaten by luggage and briefcases).
The reason for this is obvious:
People are not traveling or attending events for which they could justify the purchase of a new camera. Add to this many professionals who are simply not upgrading due to a major drop in income, and you are seeing a perfect storm for any camera company that may be struggling financially.
We are about to hit rock bottom
Back in 2019, Canon president Fujio Mitarai talked about the continuing drop in sales and the expectation that, in two years, the market would drop by around 50%.
Canon estimates that the total market will be about six to eight million prosumer and professional cameras. In 2019, when Mitarai made his statement, the sales of interchangeable lens cameras were estimated to be around 10 million.
When you see figures like that, it is hard to imagine every camera brand still being able to compete.
But who will dominate? And who will be left to follow the route of Olympus?
A while back, I said that Nikon & Canon could go the way of Kodak.
But right now, it definitely doesn’t look like Canon is going anywhere. Figures published by Nikkei show that, in 2020, Canon owns 45.4% of the market.
Canon was late to mirrorless technology, and many (myself included) thought the EOS R and EOS RP were subpar compared to what Sony was putting out. However, Canon had huge success with the 5D line, as well as cameras such as the 7D. This meant that many were still happy with their bodies and would only be purchasing lenses, flashes, etc.
It was a misstep by Canon to underestimate mirrorless, but honestly, it didn’t hurt them too much. The sales of the EOS R and RP showed that Canon has a loyal and longstanding fanbase.
Add to this the release of the EOS R5 and EOS R6, as well as their success (overheating aside), I cannot see Canon losing its market share in the next 12-24 months. So if Canon is safe, who is most at risk?
We need to talk about Pentax
Pentax’s stubborn refusal to move away from the DSLR is a potential sign that they may be heading for significant trouble in the very near future.
In 2020, the company’s statement of “Pentax believes in the future of DSLR photography” seems crazy. The sale of DSLR cameras has dropped massively since 2017.
Reading that first statement, you may think I am bashing Pentax’s managerial decisions, but I feel the problem may lurk a little deeper.
You see, I don’t think Pentax currently has the budget to develop a mirrorless camera from scratch. They have reached a point where they would need significant time and effort to do this, which comes at a significant cost.
Also, part of their recent brand statement was this line:
“When you take a picture with a single-lens reflex (SLR) camera, the light passes through the lens and, in turn, the optical viewfinder. You view the image directly with your eyes, and feel it with your heart.”
This reminded me of Fuji’s “Pure Photography” vision at the launch of the X-Pro3. Could this mean that Pentax is aiming for a niche of customers who will want to continue to use DSLRs? It certainly could be a strategy, but I am not sure how this will work in practice. I don’t think there will be enough DSLR sales to allow this to work. Even if it does, it will seemingly lead to tiny R&D budgets.
Whether it is down to budget or that Pentax truly believes in their vision and wants to create a niche, who knows? One thing that we do know is that the market has moved to mirrorless. By refusing to move with it, Pentax looks too far behind to come back, which is sad to see.
I truly feel that, as a company, Pentax will slowly fade into obscurity and then close its camera division.
Could one of the big companies follow?
The obvious point this leads to is whether one of the bigger companies will eventually fall. I think it is a case of, “While that is unlikely, nobody is too big to fail.”
The way Nikon has been overtaken in camera sales by Sony signifies a shift in the market. Nikon is set to release a new flagship mirrorless camera very soon, which will likely keep them comfortable for a while.
Here’s the longer-term question, though:
Will the market sustain three major players?
If the answer is “No,” then you would have to say, simply based on recent performance, Nikon looks to be the most likely to fade away.
I feel the Fab Five of Canon, Sony, Nikon, Fujifilm, and Panasonic are here to stay. All of them are releasing amazing cameras and pushing things forward.
However, I feel that, over time, the market will be dominated by Canon and Sony, with Nikon starting to compete with brands such as Panasonic instead of the new Big Two.
That said, if the leaks about the upcoming Nikon releases are true, I may have to eat my words.
The high-end specialists
The decline in sales to professionals due to COVID may be posing big issues for brands such as Hasselblad and Phase One. These companies’ main market is almost exclusively professionals who need the very best quality images. Again, the coronavirus issues will be having an effect on sales.
Could this be enough to topple one of these companies? I honestly don’t know, as they play their cards very close to their chests. But there was something I found during my research for this piece that did make me think that all may not be perfect in Hasselblad land.
In a 2019 interview, Hasselblad’s head of sales for Europe, Uwe Moebus, said: “There are fewer professional photographers and it is getting harder and harder for professionals to make decent money.” He then spoke of the desire for amateurs to start using Hasselblad.
These comments hint at a shrinking market for Hasselblad and its need to diversify. With COVID, we will have to assume that this will not have gone as well as hoped and could be the sign of problems to come.
Video is key if you want to keep up
While photography seemingly continues to decline, the video market is continuously buoyant in comparison.
This is due to YouTube being the new TV and the large number of YouTube channels popping up everywhere. There is also a market for crash cams in major film production. The idea of destroying a brand new camera is heartbreaking for most of us. However, when on a Hollywood budget, a relatively cheap camera that can be used with little regard to its survival (except for the memory card) is perfect for the job. This is a growing market for camera manufacturers.
The fact that Netflix has approved the use of the Panasonic S1H as a production camera creates a market that goes way beyond photographers and YouTube creators.
Sony has always been great with video; it is a huge reason for their success. The release of the 12-megapixel a7S III shows Sony releasing mirrorless cameras for video first (if not almost entirely). Obviously, this has become a hot topic (bad pun intended) with the Canon EOS R5. As a stills camera, everyone agrees it is a masterpiece. However, Canon marketed it almost solely based on its video features. All of the complaints, problems, and potential boycotts are based on this.
When shooting in 8K, you can extract a 35-megapixel still frame from the footage. In a field such as headshot photography, where you are looking for the perfect expression, you can now capture 30 shots per second, continuously. Shoot a minute of video, skim through until you find the perfect expression, then export the frame as a large megapixel file. This may well become the future for certain types of photography.
How a decreasing market will be bad for consumers
Those of you reading this are probably part of the shrinking market segment that will continue to buy interchangeable lens cameras.
However, while the market and consumer needs will dictate which companies survive and which fall, the fact is that the Olympus sale will impact the whole industry.
While I feel that technological developments will continue, budgets for research and development will be cut. Fewer camera sales mean less ability for the engineering departments to push new technology. This may lead to a future with new models having smaller, more incremental updates rather than exciting, huge leaps forward in camera technology.
Again, I feel the future will be driven by video and the developments will come from Sony’s and Canon’s high-end cinema lines.
The thing is, though:
In purely photographic terms, what more do we actually need?
Is it really that bad?
Well, this has all been doom and gloom. Is there any silver lining?
The fact that, even when the market hits the predicted bottom, there will be enough money for several manufacturers to continue working with still gives us hope. The camera launches in 2020 have been spectacular and show no signs of stopping despite the Olympus sale.
In terms of photography, I really feel we are in a position where technology can no longer give us huge improvements. Maybe a stop more dynamic range here, a little less noise there.
But as a photographer, what else do you need right now? Autofocus systems are amazing. Noise at high ISOs is fantastic. Frames per second are almost video-like. We don’t need new technology; we need more creativity, and that is still solely down to the one who pushes the button.