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Archive 2013 · Olympus Disappearing?

  
 
kewlcanon
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p.2 #1 · p.2 #1 · Olympus Disappearing?


Olympus manager Hiroyuki Sasa has been interviewed at Toyokeizai (Google translation here). And there are quite some interesting infos! I ask my Japanese readers to correct me if there are some errors. The Google English translation tool doens’t really make a very good job. Anyway, here are the hottest news:
1) Olympus will reduce investment in the compact digital camera business and focus on niche products with clear identity (example Tough series).
2) Mirrorless is doing well in Asia (Japan, Singapore and Thailand for example). Still not so good in Europe and USA.
3) We will supply our tech to Sony (example lens design knowledge)
4) We will use more Sony sensors in future.
5) We plan to launch new DSLR cameras in future.
6) We do not plan to quite the digital camera business even if it it not profitable yet. Because it drives the technology development that is helpful for our medical business too!

http://www.43rumors.com/olympus-manager-says-more-dslr-to-come-more-sony-sensors-to-be-used-in-future/

smcphotos wrote:
Thanks for the feedback, all.

So would you feel good about buying an OMD EM5 and 3 lenses right now?

One thought is that if the camera might be deemed more of a "collector" or niche product whatever happens to,Olympus, hopefully keeping some value. Maybe this is wishful thinking.

I just want to avoid buying a ew system and not having a warranty covered or the like.




May 29, 2013 at 12:07 PM
grahamb3
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p.2 #2 · p.2 #2 · Olympus Disappearing?


rattymouse wrote:
For the purposes of this discussion, Kodak IS dead, photographically speaking. A relatively short time ago, Kodak was a veritable giant in the photography industry. Today they are almost irrelevant.

Olympus is more than going down that same path.


Kodak failed because they weren't able to establish a successful business plan post film. Olympus's troubles stem from shady dealing from the medical equipment side of their business rather than an obsolete primary product (http://www.economist.com/node/21538154).

It would be more accurate to compare Kodak with the Acme buggy whip company than with Olympus.



May 29, 2013 at 12:54 PM
sflxn
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p.2 #3 · p.2 #3 · Olympus Disappearing?


If the price for the new EP-5 or whatever is any indication, they plan to stop losing money by raising prices. The comments about similarity to Kodak is spot on. Today, upheavals are getting quicker and quicker. Kodak had a decade to die. I'm not so sure digicams have that long to disappear. 18% drop in camera sales in 1 year is pretty drastic. Many of the big makers are hedging their bets by starting to maker bridge cameras like the RX1 and X100s, but so far only Fuji has found runaway success, based on what my local camera stores are telling me. The rapid decline in the digicam and PC market is simply breathtaking.

Personally, I see Olympus exiting, along with Samsung. Samsung has enough money to keep it going, but they're not getting any traction. If this decline accelerates, Pentax and Panasonic will be next to go. In 10 years time, the camera business will look a lot different. My predictions:

1) Digicam market will all be aps-c or FF bridge market but will not as big as before. Maybe 5-10% of what digicam market used to be.
2) Canon and Nikon will be the sole DSLR makers, and they be selling only FF models. APS-C disappears from DSLR as mirrorless and bridge cameras do to aps-c dslr what smartphone is doing to digicams. Also, FF will be seen as the only strong differentiator between it and the growing popularity of smartphones.
3) NEX and X will probably be the dominant mirrorless platforms.
4) Medium format shrinks drastically further as scared Canon and Nikon are forced to push further into their territory
5) Even Canon, Nikon, and Sony will not be able to offset the loss of their digicam market. Prices of FF will hit sub-$1000 in an effort to stymie the decline. This effort to push FF down to the masses can already be seen in the 6D and D600. They're just the beginning.

I do worry about Nikon. They rely on cameras for most of their profits. The booming profits days for digital imaging is coming to a close and the squeeze of commoditization is beginning. People didn't believe film or PC or digicams would disappear, but when the trend accelerates, it's brutal. Only $1k FF DSLR can save Canon and Nikon from going the way of medium format. Speaking of which, will Phase One and Hasselblad survive? Can Leica keep selling $7k M and $5k lenses when Canon and Nikon will be selling $900 FF DSLRs? The squeeze in the digicam market does not just affect that market.



May 29, 2013 at 01:14 PM
CalW
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p.2 #4 · p.2 #4 · Olympus Disappearing?


sflxn, I think your analysis is (almost) dead on. But for three reasons I am more optimistic than you about Olympus' prospects for the next five years or perhaps more. (1) the Olympus/Sony optics partnership, (2) the dependence of Olympus' medical division on the optical division and (3) the really strong talent and potential for innovation that exists in the Olympus optical division.


May 29, 2013 at 02:47 PM
millsart
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p.2 #5 · p.2 #5 · Olympus Disappearing?


rattymouse wrote:
The camera market is seriously contracting. There are too many manufacturers of cameras, most not making *ANY* profit. This is not a sustainable position and at some point, certain makers will leave the industry. That Olympus has a rich and long history making cameras is utterly irrelevant.

If Kodak can die, so too can Olympus.


Its not contracting, people are taking more photos that before, but they are also not endlessly upgrading every few months like in the past.

When we all had 3 meg Canon D30's who couldn't wait to drop more cash on a 6meg 10D ? And then the 20D upped it to 8megs and 5fps...whooo, exciting stuff, had to have it. So on and so forth

These days though its like every "new" camera is the same sensor or maybe 2 megs more, which when your already at more than most people realistically need, just isn't the big marketing push it used to be.

Gets to the point where its "good enough"

I'm sticking with my Nikon D3s and original 200-400 for example. Just don't think it would make a difference in my business to drop $10K on D4's and $7000 on a new 200-400 with a different microcoating.

Same goes for m4/3 or anything. Do you need the new black 45 1.8 if you've already got one in silver that is working fine ?

If your happy with a EPL mini are you really going to rush out and buy the new version ?

Some will of course, but by and by, I think a lot of consumers are pretty comfortable with what they've got and what it does for them, and just aren't going to keep upgrading until some really remarkable comes along.

Companies that came to count on brisk sales every time they make the slightest tweak just aren't happening.

Nor is the compact market really a profit center anymore, plenty are happy with a camera phone.

Market is growing overall, but its sales that aren't keeping pace with the it like they used to, and companies need to rethink their business models.

Revolutionary product every 18 months instead of evolutionary product every 6 for example.




May 29, 2013 at 03:02 PM
michealj
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p.2 #6 · p.2 #6 · Olympus Disappearing?


I agree with Millsart.
+1




May 29, 2013 at 03:09 PM
sflxn
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p.2 #7 · p.2 #7 · Olympus Disappearing?


CalW wrote:
sflxn, I think your analysis is (almost) dead on. But for three reasons I am more optimistic than you about Olympus' prospects for the next five years or perhaps more. (1) the Olympus/Sony optics partnership, (2) the dependence of Olympus' medical division on the optical division and (3) the really strong talent and potential for innovation that exists in the Olympus optical division.


I think Olympus will survive. They just stop making cameras and continue making medical equip. Don't worry, m43 will be around for a few more years. The Sony partnership is a sign of drastic measures. You can bet the execs at all of these camera makers have been in emergency meetings all year last year. I understand the Olympus' medical division reliance on camera R&D. However, that doesn't require Olympus to be IN the camera business. Sony can provide the digital imaging expertise for this. OIympus can continue the optical R&D by providing Sony with optics. This partnership is not the lifeline to keep Olympus cameras afloat that consumers think it is. It's a pooling of resources and removal of redundancy by two companies who see an incoming tsunami.

The trend I describe is best described as a tsunami. An earthquake in the middle of the ocean simply causes shockwaves in the water that ripples across the ocean till it crashes on land. Just think of the water compressing and building up. That's what's happening to all of these camera companies. It doesn't just wipe out P&S and stops. It's a compression force is effecting every one of their product lines. These guys don't just say, "oh well, I guess we can't sell anymore P&S. I'm sure our shareholders will understand." They will do what they can to make up that loss in revenue. I'm not so sure they fully understand how big this tsunami is yet. Olympus still think the market for the XZ-1 will continue. Ricoh is selling the aps-c GR for $750. The high end digicam is going to aps-c. Anything smaller are simply dinosaurs unaware of the incoming meteor.



May 29, 2013 at 03:19 PM
rattymouse
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p.2 #8 · p.2 #8 · Olympus Disappearing?


millsart wrote:
Its not contracting, people are taking more photos that before, but they are also not endlessly upgrading every few months like in the past.


I said the camera market, not people taking pictures. Most certainly the sales of cameras are in serious, protracted decline. We are seeing millions less cameras sold by the traditional camera market each year now. Millions less in sales volume in just a few years.

That people are taking more photos seems irrelevant to this discussion, and is certainly no help to Olympus.



May 29, 2013 at 05:41 PM
rattymouse
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p.2 #9 · p.2 #9 · Olympus Disappearing?


grahamb3 wrote:
Kodak failed because they weren't able to establish a successful business plan post film. Olympus's troubles stem from shady dealing from the medical equipment side of their business rather than an obsolete primary product (http://www.economist.com/node/21538154).

It would be more accurate to compare Kodak with the Acme buggy whip company than with Olympus.


Olympus would be in bad shape even without their accounting scandal. They simply are not selling enough cameras to be profitable. Their corporate reports shows that ALL their profit comes from the medical side of the business and that ALL their losses from the imaging side.

Olympus has not transformed itself into a profitable digital camera business, just like Kodak and so we today have to speculate when they will fold up shop and become an ALL medical business.

Had they a thriving camera business, this discussion would not be taking place.




May 29, 2013 at 05:45 PM
Pixel Perfect
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p.2 #10 · p.2 #10 · Olympus Disappearing?


michealj wrote:
I agree with Millsart.
+1



+2

sflxn analysis was overly pessimisitic for the DSLR market and APS-C in DSLR will not die. No matter how you slice it a FF camera will always be larger, heavier and much more expensive. If you can get a FF down to $1K you can get a APS-C camera down to $250 and most people don't see a need for FF. You could get a APS-C camera and a good lens or tow for the price of the bare FF camera and that's a huge selling point. Crappy smartphones are killing crappy P&S for sure, but the mid to high-end P&S will survive for a lot longer and ass communication functions are incorporated we will see their viability improve. DLSR's are under no real threat, but will also evolve to answer some of the issues they face. The world will have more than enough people serious about photography to continue well into the future IMO.



May 30, 2013 at 07:45 PM
rattymouse
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p.2 #11 · p.2 #11 · Olympus Disappearing?


P & S sales help keep prices down across the product line. With P & S sales disappearing rapidly, the cost structure of the remaining cameras is going to have to be reworked in order to keep companies profitable.

This is where Olympus will have serious trouble.



May 31, 2013 at 02:08 AM
dalegaspi
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p.2 #12 · p.2 #12 · Olympus Disappearing?


I would like to have whatever sfixn is smoking. it assumes a lot of things:

- as Pixel Perfect pointed out, FF will always be more expensive than APS-C. profit margin drives the bottom line. if there is FF DSLR, there will always be APS-C DSLR.
- it assumes that all photographers want the same type camera. you can't assume that a person who needs an Phase One IQ 180 would be satisfied with a D800e.
- MF market shrinking drastically. really? and the source for this fact is? did B&H suddenly stop carrying digital MF equipment?

and why worry about Nikon? they do other stuff, too, ya know? A huge chunk of their earnings come from precision equipment.

if sfixn is right (i don't think he is), it's a gloomy outlook for all of us cat-picture-takers, er, i mean, photographers in general, not just Olympus.



May 31, 2013 at 10:13 AM
Sagar
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p.2 #13 · p.2 #13 · Olympus Disappearing?


And Nikon is not only dependent on camera sales. Though they operate as independent brand mostly selling cameras, they are owned by a conglomerate Mitsubishi for which Nikon is just one of many companies they own

http://www.mitsubishi.com/php/users/category_result_info.php?lang=1&company_id=00000004



May 31, 2013 at 04:49 PM
RCicala
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p.2 #14 · p.2 #14 · Olympus Disappearing?


Sagar wrote:
And Nikon is not only dependent on camera sales. Though they operate as independent brand mostly selling cameras, they are owned by a conglomerate Mitsubishi for which Nikon is just one of many companies they own

http://www.mitsubishi.com/php/users/category_result_info.php?lang=1&company_id=00000004


This doesn't mean Nikon is owned by Mitsubishi.

Nikon, along with 40 something other companies, is a member of the Mitsubishi Kinyokai or Keiretsu - a group of companies with interlocking relationships centered around a core bank (in this case Mitsubishi Bank).

The companies often own minority stakes in each other. In this case Mitsubishi owns 5% of Nikon - they are certainly not a majority owner.



May 31, 2013 at 05:00 PM
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