The Price of Enthusiasm

Probably the biggest discussion going on among photography enthusiasts today has to do with price. Olympus’ revelation yesterday that the E-M1 Mark II will sell for US$2000 just threw a little tinder on the flame already burning.

What’s happening is a multitude of things occurring simultaneously:

  1. The appreciation of the yen against most major currencies—especially European—has automatically added 15% to pricing just to retain the same profit margins. Most of the camera company subsidiaries have been cut to the bone worldwide due to previous management decisions, so there’s little ability left to absorb currency differential by reducing staff/costs. 
  2. The loss of lower end camera sales has cut unit volumes considerably at every camera maker. Some—Olympus comes to mind—spent several years writing off assets and closing down parts of the business in order to get head count and resources more in line with sales. But none of the camera companies has solved the simple problem that keeps lowering that volume: cameras don’t share images well. So volume is still tracking downwards, which makes overhead costs per unit go up.
  3. Most of the camera companies have decided to abandon their old elasticity of demand curves and drive product lines upwards. They’re willing to take less volume at higher margin, basically. That’s because they believe that it’s the dedicated enthusiast that’s most likely to buy now (see #2), and they think that group is not as price sensitive as long as quality/performance is pushed higher.

It used to be that we had serious camera price points at US$700, US$900, US$1200, US$1900/2000, US$2400/2500, and US$3000+. These are drifting upwards. Just in the crop sensor mirrorless world lately we’ve gotten:

  • Canon EOS M5: US$1000 (APS)
  • Sony A6500: US$1400 (APS)
  • Fujifilm X-T2: US$1600 (APS)
  • Olympus E-M1II: US$2000 (m4/3)

The problem with that is that, with middle/end life discounting, we’ve now got DSLRs doing this:

  • Nikon D7200: US$1000 (APS)
  • Canon 6D: US$1500 (full frame)
  • Canon 7DII: US$1500 (APS)
  • Nikon D500: US$1800 (APS)
  • Nikon D750: US$1800 (full frame)

Take any one of those price points and compare the mirrorless against the DSLR (e.g. EOS M5 against D7200): generally less performance/quality but smaller size at the same price. (Nikon, please please make an appropriately small full DX lens set, buzz, buzz.) 

You can see why the E-M1II is generating so much discussion: it’s more expensive than full frame DSLRs. There’s absolutely no way that the image quality matches up, regardless of how far you might think Olympus has pushed m4/3 sensor capability lately. Yes, some of the other performance aspects look quite good on the E-M1II, better than the D750 (though not clearly better than the less expensive D500). 

It seems that everyone wants to get US$1500-2000 from you now, just for a sophisticated camera body. Add buying new lenses into that equation and things get dramatically problematic. Nikon DX owners complained about the somewhat high price of the 16-80mm f/2.8-4. Well, the Olympus 12-100mm f/4 is more expensive. 

If instead you were to go with the f/2.8 Pro lens set and an EM-1II, you’d be sending Olympus US$5800. And you’ll probably want that f/2.8 set over something less substantive because of the smaller sensor size Olympus uses. 

Those US$10,000 medium format cameras with one lens are starting to look less imposing, aren’t they? ;~)

Suffice it to say that the camera companies have mostly decided to take the route that the HiFi industry did when CDs and eventually MP3s began really crushing them: go upscale. At the moment there’s no end in sight. Nikon has made a bit of a play downmarket with KeyMission and DL, but my initial assessment of KeyMission is that they didn’t really solve user problems, only generated new ones. Moreover, KeyMission is clearly niche, and a niche that in itself seems to be declining in volume. 

The simple problem is this: the camera companies need to produce products in the under US$1000 range that have clear performance/quality improvements over smartphones but can share images just as easily. That’s the solution in a nutshell. It’s been the solution since I first started writing about that in 2008. That it remains an unfulfilled solution eight years later means that someone seriously took their eyes off the ball in Tokyo.

What I want—and everyone else wants—is a camera that takes great images and puts/gets them where I (they) need them. Instead, I—and everyone else using a dedicated camera—have so many workflow problems and issues that aren’t solved (or not solved well) that sometimes it’s just easier to pull out the iPhone and shoot with that. And that iPhone gets better as a camera with every generation.

This is a leadership issue. There is no leader in dedicated cameras. Yes, there’s a company with the biggest market share, but they’re not leading the charge as to what will save the camera industry from further decline. No one is. Not Canon, not Fujifilm, not Leica, not Nikon, not Olympus, not Panasonic, not Ricoh/Pentax, not Sony. 

Instead of true leadership and clarity of the future of cameras, we’re seeing massive technology and performance iteration. More pixels, more dynamic range, more focus speed, more fps, more video ability, more, more, more. But all those things are pushing products upscale, too, and fewer and fewer people are finding that they actually need/want those things. 

Here’s the path to a healthier camera market:

  • Make it a bit smaller/lighter overall (compared to current model).
  • Make it tougher overall (compared to current model).
  • Make it share directly.
  • Solve all the workflow problems every user has.

That’s it. A 24mp APS sensor mirrorless/DSLR that does those things right compared to the current model at US$700 will sell in greater quantities than today’s models. Almost certainly. And so would the US$2000 version of this, too ;~).  

Aside: Apple dropping the SD slot on the latest MacBook Pros is just further workflow complication for the camera companies. Apple thinks the future is wireless and USB-C. I’m pretty sure they’re right. As usual, Apple is forcing the issue and being slightly ahead of the curve. But within a couple of years, every computer, tablet, and phone is going to be wireless and/or USB-C. 

What’s that mean for cameras? Given that the camera companies still haven’t caught up to the last wave of technology and used it appropriately, they are just even further behind. Let me suggest to them where they probably should be two years from now: drop removable cards for SSD internal storage and add WiGig to offload images (USB-C as a physical backup). Two years is one camera update cycle, by the way. 

It won’t happen, unfortunately, and the camera makers will continue to wonder where their market went. It went out the window they left open...

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