The steep pricing on various new Canon products has left me wondering if Canon is trying to reposition its DSLRs as a more "elite" product line. Perhaps they feel that the DSLR is going to wane from the pressure of smaller cameras and feel they can increase or maintain profits by increasing the per unit value to offset lower volume. I really have no idea, but their pricing certainly can't be considered aggressive and in fact, it is just the opposite.
For example, I have no doubt that the 5DMkIII will be a fine camera but $3500? Give me a break. That's $1100 over the current, assumingly profitable, price to fix an AF system that doesn't belong in any current camera over $600 and taking advantage of faster, but cheaper, memory to get the FPS up. Sure there are other improvements involved and included but that's to be expected after three years as today's cameras are essentially computers and subject to a similar pace of technological advance.
Some other recent offerings point to the same trend...
$800 for the new 28 f2.8
$850 for the new 24 f2.8
$10,500 for the new 500mm f4
$13,000 for the new 600 mm (BTW that's nearly a $4K increase in case you don't know)
$2,300 for the new 24-70 (up $1K)
Before the flaming starts, please note that I am not saying that any of these are bad products nor am I saying that they are not worth the asking price to those who need or want them. I am simply pointing out the obvious, that Canon is pursuing a practice of big price increases at a rapid rate.
Canon built their camera division on inexpensive cameras in the 60s, 70s, 80, and especially the 90s. They were the first to bring in lower cost full-frame (and first full-frame) DSLRs and they were the first to break the $1000 barrier.
They may fiddle with the above $1000 area, but they will always be strong in sub $1000.
The lenses you cite may well decline in cost (and relative cost) when they get to be 10 year old designs.
10 years ago my D60 cost $2200. 6mps, 3 (count them, 3) auto focus points and it may have had a couple of fps. I'm sure if the 5D3 price starts out at $3500 it will drop to a more affordable $2900 as soon as the "I've got to have it now" crowd buys in. So either Nikon got it wrong with their pricing or Canon does. If both cameras were priced at $3300 no one would bitch to much, OK there's always a few.
To me it seems very clear Canon is making DSLRs (and presumably very soon DSLTs) a premium product as seen by the unprecedented price increases on almost all of their related products.
My only concern is that Sony and Nikon aren't playing along, leaving Canon with a the undesirable position of being more expensive and arguably behind on tech.
You're discussing price increases in dollar when Canon sells wholesale in yen.
You're also forgetting supply and demand. Initially, Canon will only be able to make a limited amount of 5DIII, for example. They will fly off the shelves. Over time, supply will increase, people who were willing to pay top whack will already have a camera, and the price will fall accordingly.
A lot more people have DSLRs than when the 5DII was released. High-end photography isn't a niche market any more. Let's say your potential market was one million people in 2008 but two million people in 2012. If your initial production run is (plucking figures out of nowhere for the sake of argument) 50,000 cameras because that's the most you can make regardless of market size, then of course you're going to jack up the price. It's not repositioning, it's just maximising profit.
Same with the lenses. You've quoted the prices of new releases only. Prices will fall when Canon can no longer sell existing stock.
You're also dealing with what is effectively a duopoly. They can do whatever they want and if they make a mistake, worry about it later. People have too much money invested in lenses to switch at the drop of a hat.
I don't think Canon is repositioning itself, but merely expanding its range of products. They have plenty of cheap and moderately priced optics and cameras. For example, their most popular DSLR, the Rebel line, was split into lower, middle and higher price points. The lowest model, the T3, starts around $500 with kit lens. I think its kit lens, the 18-55 was revised three times in 5 or 6 years! The 60D was squeezed in between the Rebel and 7D and is easily affordable for most serious hobbyists. I bought one last year for $900.
The products the OP listed are mostly premium products and sold in small quantities to gear hounds, well heeled gentleman amateurs and pros. Most of Canon's newer photo gear is reasonably priced and indeed much of their attention for years was devoted to creating cheap consumer lenses to replace film era zooms. They have finally gotten around to significant revisions of their pro glass. The cost of doing business is a lot higher than it was 5 years ago, so prices are bound to go up. Plus, most of these premium products sell in low quantities and have plenty of lower cost alternatives from Canon and aftermarket lens makers.
The 5D2 is basically 3.5 years old and sells for $2300-2400 depending on rebates.
The D700 is four years old and was selling for $2700 until yesterday.
Both still sell well at those prices.
A new camera coming out at higher price point, given the vagaries of the dollar over the last four years and improved specs (AF most obviously) should not surprise anyone.
john_edwards wrote:
10 years ago my D60 cost $2200. 6mps, 3 (count them, 3) auto focus points and it may have had a couple of fps. I'm sure if the 5D3 price starts out at $3500 it will drop to a more affordable $2900 as soon as the "I've got to have it now" crowd buys in. So either Nikon got it wrong with their pricing or Canon does. If both cameras were priced at $3300 no one would bitch to much, OK there's always a few.
You're probably exactly right. I seem to recall the original 5D debuting at $3500 and was going for $2000 3 years later. Gear hounds snapped it up at full price and I sat on a waiting list for months. I finally bought it for $2500 during mid lifecycle.
This is exactly the same approach to the market as Leica adopted when they brought out their first slr camera. The Leica sl lacked behind the lens metering and cost much more then the comp. Nikon. Leica never really gained success in slr cameras, but Nikon flurished. Perhaps Canon feels that they are the dominant player in the indusrty and that the competition will follow and raise prices. I don't think that they are correct and they will be forced to reduce these prices
when supply exceeds the demmand, which will probably be much sooner then they anticipated, given the lack luster nature of their new offerings.
If nobody buys it at $3500 I bet they drop the price. But I bet neither of those things happen for a while.
I just sold my house. When I told the Real Estate agent what I thought it was worth she told me I was too low and suggested a higher price. It sold in two weeks, so she was right. You'd all tell me I was crazy if I went back to the buyer and said "I really don't think the house is worth that much, let me cut the price $15,000."
Sp12 wrote:
To me it seems very clear Canon is making DSLRs (and presumably very soon DSLTs) a premium product as seen by the unprecedented price increases on almost all of their related products.
My only concern is that Sony and Nikon aren't playing along, leaving Canon with a the undesirable position of being more expensive and arguably behind on tech.
I hate the new lens pricing too. But then I remind myself that in 1990 I paid $700 for a MF Nikkor 20mm f/2.8, and maybe about $800 for a 180 f/2.8ED. That was good pricing in those days.
No way I could afford those lenses now at a year 2012 dollar equivalent.
They can charge what they want, and supply and demand will determine if they are correct. It is what it is.
70-200 2.8 IS II debuted around $2500 and was selling for under $2000 at Christmas.
I have no idea if this is correct but I have read that the American market long benefitted from lower pricing, perhaps due to its importance and high sales volume relative to many other regions. It would seem this is less the case now, no doubt in part due to the economy and combined with the drastic drop in value of the USD vs. the JPY over the past 10 years, to about half of what it used to be, so that companies such as Canon could no longer justify status quo pricing.
I believe Canon recognizes that high end pro gear is becoming more of a niche market and that the professional need for much of that gear will decrease as less expensive but similarly specified equipment continues to be released (or 40MP phone cameras). Traditional markets such as photojournalism get by now with prosumer cameras, never mind 1D bodies. For those who really need the high end gear, they will have to pay (more) to play.
You think Canon users have it bad? Look at Leica... M series lens prices have skyrocketed and theoretically could go even higher because demand continues to outstrip supply...
If you compare the prices in US dollar. Then you have to compare the exchange rates from a few years back also. Or do you compare American companies prices in foreign currencies also?
My opinion: it will backfire on Canon. I am convinced that the 5D III will be a nice full frame camera, but Canon will face severe competition with the D800 from Nikon which comes with a much lower price tag and likely higher resolution (and even if the D800 will suffer from a few minor drawbacks, it will be more attractive). Canon was forced to implement a nice AF system even in the 5D III - I am sure it would not have happened if the D800 wouldn't have come out. This of course gives competition in house with the 1Dx (yes, I know, 1Dx has weather sealing, faster fps etc) - there are some professionals who certainly will go for the 1Dx instead of the 5D III, but this is a minority. Who is going to pay now $3K more just to get the 1Dx? Not many, especially not in this economy. The only way out for Canon is to lower drastically their prices to move along with Nikon's price tags.
Now to lenses. Same thing - wrong marketing decisions in Canon's house in the recent past. Sure, the new lenses will be great! But....who is buying them? Yes, I know here in this board are many who will, but it is like looking on an island and forgetting the whole other world around. The competition is not sleeping - even if Tamron's 24-70 is not so perfect in the MFT charts compared to Canon's 24-70, the difference in price is huge. Many will go for the very decent lens for a much lower price.
Overall I think Canon will be in trouble in the DSLR market niche. The leadership position is no longer certain for sure especially after Nikon's recent moves. It will take a while for Canon to change the course, but the new CEO in house is already a sign of changes to come. Let's hope for the better......
If they are ... and if their new lenses are vastly superior to Nikon ... the high prices are justified. I've said before that you cannot have Leica quality at old Canon prices. If they were able to raise the IQ bar and it's now approaching the IQ of Leica glass, it's perfectly justifiable.
But I don't think the 5D III is better then the D800 ... and they should price it accordingly.
3 years ago I bought the 800mm for $10K; now, its about $14K. Both the 500mm and 600mm have increased $4K. So, at least in the longs lens market, prices have increased 40% in 3 years.
The Big Whites are the definition of specialty items, so their pricing is arbitrary, really.
The new 24-70 is priced as the original one on release, as has been pointed out.
So, no price increase here. I'm sure the new one will never drop as much as the old one, though.
I bought the old one for $1050 in 2005. This price is not realistic in 2012.
I'd wait for the 5DIII announcement tonight before proclaiming that Canon is officially crazy .
$3500 is so not sustainable for this class of camera and I doubt that Canon's marketing department doesn't know it.
At $3500, who is the 5DIII for - the RED crowd only .
Good luck selling any volume at this price.
If you read the Canon financial reports, sales of DSLR's are increasing, while point and shoots are a plague on the market. They expected 69% of their camera sales dollars in 2011 to come from DSLR's, but apparently exceeded that.(no final number yet published)
Given the high demand for DSLR's, I think they feel that the Market will bear the higher prices.
Nikon, on the other hand, is holding the line on DSLR bodies, but cleaning up on lenses at high prices. Thats similar to the printer and ink situation.
So, you have the higher prices right, but for the wrong reason.
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