Smartphones Destroying High-End Camera Sales - InformationWeek

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11/8/2013
10:37 AM
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Smartphones Destroying High-End Camera Sales

Smartphones with powerful cameras have begun to take a toll on sales of expensive, dSLR cameras. But are they really good enough to replace them for most users?

Smartphone makers such as HTC, Nokia and Samsung have made it a point to build powerful cameras into their mobile devices. Many of today's leading smartphones offer not only high megapixel counts, but astounding software that lets them shoot in a wide variety of different modes. The appeal of camera-equipped smartphones has led to a decline in point-and-shoot camera sales for some time. Now it appears that these uber-devices are impacting sales of high-end, professional cameras, too.

Research firm IDC predicts that shipments of what it calls "interchangeable-lens cameras" (or dSLRs) will drop 9.1% from 19.1 million last year to 17.4 million this year. At the same time, Canon and Nikon, the leading dSLR makers, have been forced to lower forecasts for the year. Further, Tamron, a third-party maker of lenses, saw shipments slump by as much as 22% during the first three quarters, according to The Wall Street Journal.

"We are seeing tough figures at the moment, but I don't think this will last forever,'' said Nikon Chief Financial Officer Junichi Itoh. "There still is potential demand, and I think China is the key."

Tamron knows it is in trouble. "Smartphones pose a threat not just to compact cameras but entry-level dSLRs as well," said general manager Tsugio Tsuchiya. Nikon and counterpart Canon blamed the slower shipments on a weak global economy, but that's not the only factor at play.

In July, Nokia announced the Lumia 1020, a smartphone that boasts a 41-megapixel PureView camera. The camera features lossless zoom and controls that often match those of dSLRs when it comes to adjusting the behavior of the camera. Nokia has made no secret of the fact that it wants its powerful smartphone cameras to set Lumia-branded smartphones apart from the competition.

Last month, Apple introduced the iPhone 5s with an 8-megapixel camera. Apple took pains to improve the camera with a wider aperture and more sensitive sensor. The same is true of the HTC One, Samsung Galaxy S4, LG G2 and other top smartphones. Many of these device manufacturers pitch their phones as replacements for stand-alone cameras.

The phone makers aren't alone. The app economy has risen to support smartphone-based imaging. Consider Yahoo's Flickr. It has revised both its Android and iOS apps in the past 12 months and offers customers 1 TB of online storage for free. Then there are apps such as Instagram that make editing and sharing picture fun and social. Social networking sites, including Facebook, Google+ and Twitter, all place a premium on posts that include images. All three have worked hard to make it easy to share images online from smartphones. Combine good cameras with appealing software and the easy portability of smartphones, and you have a recipe for disaster as far as dSLR makers are concerned.

Canon doesn't quite see it that way. "Taking photos with smartphones and editing them with apps is like cooking with cheap ingredients and a lot of artificial flavoring," said Canon spokesman Takafumi Hongo to The Journal. "Using interchangeable cameras is like slow food cooked with natural, genuine ingredients."

If there's one thing people like to do with their images, it is to share them. With dSLRs, this often involves removing a memory card, putting it into a computer, downloading the images and then sorting through them before posting them online. The immediacy offered by smartphones is compelling.

There's no question that dSLRs and other stand-alone cameras often produce better results than smartphones in the long run. Professionals will likely always use heavy-duty imaging gear when on the job, and prosumers are likely to prefer dSLRs to their smartphones for advanced hobby use. The general population, however, may find that smartphones fulfill their imaging needs.

An old saying goes, "the best camera is the one you have with you." For an increasing number of smartphones buyers, that will always be their mobile device.

What do you think? Have you given up on advanced cameras, or do you find them preferable to smartphones?

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Thomas Claburn
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Thomas Claburn,
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11/12/2013 | 9:08:30 PM
re: Smartphones Destroying High-End Camera Sales
Interchangeable lenses for iPhones also have the problem of (probably) not being forward compatible. I've avoided getting an iPhone snap-on lens simply because I expect that the next phone I buy will not work with lens acquired for an earlier model phone.
Shane M. O'Neill
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Shane M. O'Neill,
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11/12/2013 | 12:00:35 AM
re: Smartphones Destroying High-End Camera Sales
It's hard to argue with the ease-of-use, sharing features and, increasingly, the picture quality of smartphone cams. Granted, snapping a sunset with your iPhone and throwing an Instagram filter on it is not exactly photography, but it looks enough like it to please most folks -- and really hurt dSLR sales. The pros know the difference, but smartphones are getting closer and closer to the real thing.
Thomas Claburn
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Thomas Claburn,
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11/11/2013 | 9:28:53 PM
re: Smartphones Destroying High-End Camera Sales
For soccer games, the iPhone is not enough. You need a good telephoto lens.
Michael Endler
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Michael Endler,
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11/11/2013 | 4:23:16 PM
re: Smartphones Destroying High-End Camera Sales
"There is no image compression when zooming in."
Great point. Nokia's "reinvented zoom" has uses-- but it's not a true zoom; it's a crop. Different in many ways, including optically.
Michael Endler
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Michael Endler,
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11/11/2013 | 4:20:32 PM
re: Smartphones Destroying High-End Camera Sales
It's a good point, and for a ton of pictures, having the iPhone with you is totally adequate. But what if you're at your kid's track meet or soccer game, and all you have is your iPhone? Or what if it gets dark and all you have is a Lumia? If a smartphone gets an awesome action shot, even in good light, it will come down to dumb luck. Good timing helps, but smartphones lack the autofocus tracking, ergonomics, etc. that are necessary to photograph a rapidly-changing scene. And if it's dark, your options get limited pretty quickly-- what is one to do now that screen resolution has become dense enough for all the ugly posterization that you get from boosting shadows to become plainly visible?

Smartphones are great photography tools, and it's interesting that Nokia/Microsoft is supposedly going to make RAW images files accessible on Lumias. But even a step like that will only sort of address the problems with poor light, and it will do nothing for action shots. It's true that smaller cameras are coming, and that they'll be integrated into lots of devices that we carry around all the time. But depending on what you're trying to photograph, sometimes the "camera you have with you" isn't much better than having no camera at all.
Michael Endler
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Michael Endler,
User Rank: Author
11/9/2013 | 6:04:18 PM
re: Smartphones Destroying High-End Camera Sales
Yeah, and I think that's how it's going to be for at least a few years. In good light and with a static subject, smartphones will give you 95% of a DSLR's output, but for a fraction of the cost, bulk and inconvenience. But for many other photography scenarios (bad light, moving subjects, etc), the advantages of a "real camera" become apparent.

Smartphones are going to change the way camera companies build their portfolios, but they're several generations of technology away from legitimately replacing even mid-range DSLRs. The people who bought Canon Rebels might be happy with their smartphones, but I think a lot of people who bought into, say, the XXD series (and definitely the XD series) are still going to see their cameras as the "serious tool" and their smartphones as their "fun shapshot tool." These higher-end users still number in the millions, and they're way more likely to buy additional products (lenses, flashes, support rigging, gels, filters and so on) than the people who are dropping their DSLRs in favor of camera phones. So, no, smartphones aren't replacing DSLRs, on the whole. But they're reshaping the market and the usage scenarios.
Michael Endler
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Michael Endler,
User Rank: Author
11/9/2013 | 5:56:09 PM
re: Smartphones Destroying High-End Camera Sales
I think your comments are quite fair, though I think crop cameras have at least a few more years of value for some users--e.g. if you're a semi-serious sports or wildlife photographer, a prosumer APS-C sensor paired with a long lens will give you better image quality than a full frame camera with a long lens, unless you're willing to shell out $7k-$15k for the highest-quality professional telephoto lenses.

If you stick a $700 200mm f/2.8 prime on a 5D Mark III for example, the aperture and focal length are exactly as listed. But if you put the same lens on a 7D, you get a 320mm field of view with brightness that's similar to what f/4 would be on full frame-- that is, you gain about 60% more reach but lose around a stop of light, assuming you're using each camera in the same position. To get a 300mm f/4 full frame field of view, though, you'd have to pay closer to $1200 for the lens, or use a converter on your 200mm prime, which yields poorer image quality (and auto-focus) than using the crop. As the focal length increases, the cost differential between a true full frame telephoto and a crop-enabled telephoto becomes even more extreme.

So for certain users, the buying proposition includes more than whether the camera sensor is good enough; it also includes TCO for lenses, accessories and so on. Crop cameras still have value there, at least until lenses like the 200-400mm f/4 drop in cost by 50%.

But low-end DSLRs sales are getting eaten by cell phones, and I think at least some of the big camera manufacturers are going to produce medium format cameras that cost $10,000+ per body-- that is, they're gonna push for the professional, high-margin segment, just as you said. Rumors suggest Canon might purchase Phase One, for instance.

I also think cinema-style cameras (which are a direct byproduct of the popularity of video-enabled DSLRs) give some of them (Canon and Sony for sure, maybe also Panasonic) entirely new ecosystems to work with. Canon's 3-chip professional camcorders were useful for documentaries/news, but the large-sensor C100 and C300 cover not only this niche but also independent films, reality TV, ads, music videos-- pretty much anything that doesn't require native 4K capture, RAW footage acquisition or slow motion. And Canon has only made the C300 and C100 inappropriate for these markets because the company is artificially protecting its top-end C500, which accommodates these remaining customers. Canon's also now selling cinema lenses that are basically the same optical formula as its L-series primes but cost 2-3 times more because they're aimed at motion pictures professionals who are used to - and surprisingly willing - to spend a huge premium for very specific perks. That's relatively little R&D cost for Canon in exchange for entry into a niche but high-yield market that has kept a lot of smaller players afloat for years.

Still, even among "normal users," I defy any soccer mom/dad to find a smartphone or even low-end DSLR that can actually keep up with fast-paced action. If you're telling your kid to stand still and smile, an iPhone or Lumia is just fine. But if your kid is sprinting dow the field, the best live view autofocus in the world still can't track moving objects worth a damn, and I think we're at least a couple years away from that changing. So cameras such as the Canon 70D or 7D or the Nikon D7100 have a consumer market outside of legitimately high-end users. It's a shrinking market, but not one that I see going extinct.
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