Digital Camera Market Slowing?

[harrisfoto]

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"Olympus Corp. . . . reported its biggest quarterly profit drop in almost three years because of falling camera prices. "

See the full story at:

Bloomberg.com: Worldwide

Is the reason for buying another new camera becoming something other than technical upgrades? Is the market for point and shoot digitals becoming a mature market?

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[eekimel]

I believe the report (at least just the quote you posted) attributes it to falling camera prices. Three years ago, you had pay considerably more to buy a decent entry level digital P&S. So that's part of it. Another part of it is people have less disposable income (especially in the U.S.) I don't think the digital camera market is slowing any more than other markets for non-essential goods and services.

[stuny]

I think Erden is correct. I also suspect it will get worse as Europe is beginning to show signs of what happened in the US a year ago.

[psamson]

Buckle in. The US has not hit bottom yet. We have yet to see Winter and the impact of heating-oil and natural-gas prices on families. In addition, starting to see a few articles hinting people falling behind with prime mortgages (better qualified than subprime loans).

[earleygallery]

I think this is the result of a combination of factors;

 

Prices have fallen = smaller margins for the manufacturers.

 

The average consumer (someone who uses a camera for holidays and special occasions only) will typically upgrade their camera when necessary, i.e. broken/lost/stolen and are less likely to do so for a new feature or higher MP's. After the initial demand for lower end digital cameras as people switched from 110/APS/35mm compacts, sales have declined/levelled off.

 

Camera phones have improved to the point where a 2MP camera in a phone is now considered to be 'basic' - more consumers are using their phone camera instead of buying a dedicated digital camera (see above!)

 

Added to all of this, the impact of Credit Crunch - consumers are spending less on non essential purchases across all sectors.

[dominic]

It's not a general problem (Nikon has doubled its profit) but the problem of Olympus coping with a bad concept : the "4:3" and a small sensor.

 

Hope that Leica with Panasonic is not about to get mixed up in that mess...

[earleygallery]

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Actually it is more of a general problem. One of my clients is a major manufacturer of electronic consumer goods including digital cameras, and they are facing exactly these issues.

 

They are forecasting substantially less turnover in most markets over the next year. The exceptions are mostly former Eastern bloc countries where sales are continuing to increase.

 

Rising costs of raw materials, labour and energy are all impacting profit margins, whilst cut throat competition means that prices cannot be increased unless they have a unique or niche market product.

[wilfredo]

Hey, on the bright side, Bush, the oil industry and the Martin Friedman die hards of the world can buy just about anything they want.

 

All joking aside, these are difficult times for consumers and manufactures alike. I guess that's what happens when one sector gets more than their fair share of the pie. There are not enough scraps left over for the rest of us.

 

 

Wilfredo

Benitez-Rivera Photography