(commentary)
Several of the games I play in my spare time require a real skill that is often overlooked: deciding when you are the aggressor and when you are the defender at any given point in the game.
If two players both try to be the aggressor at the same time, the dominant player—the one with the most assets—will pretty much always win if the other doesn’t change their strategy to a more defensive one. If two players both try to be the defender simultaneously, you get a long boring game, and sometimes—as in chess—a draw.
Why do I bring this up in conjunction with cameras? Well, I think orthogonally a lot, as it often helps me understand the thing I’m trying assess. What provoked this article are two publications about the current status quo in the tech world.
First up is the publication of this year’s BrandZ list. Each year, Millard Brown attempts to calculate the “brand value” of major companies.
So where is Nikon this year's Top 100 list? Beneath it. As is Canon and every other Japanese camera maker including Sony (the break-in to Sony’s IT and email systems probably cost it a lot of brand value points this past year).
Where are some of the camera companies' “imaging” competitors? Considering smartphones: Apple’s #1, Google’s #2, Microsoft is #3, and Samsung’s #44. If we consider that images these days move a lot through telecom, then other companies appear: AT&T #6, Verizon #7, China Mobile #15, Vodafone #23, plus eight other telecoms are in the top 100. Add in Facebook and Twitter, both of which have image aspects. So, at least 14 of that top 100 brands are directly influencing how images are made and shared. But not a single camera company is in that group.
Put simply, the camera companies are playing defense. Every one of the companies that the masses associate with their images in some way is a “bigger brand” in those same consumers’ minds.
It won’t be the Japanese camera companies deciding how you take images, how you move them around, or how you display them in the near future. That would be trying to play offense against a better set of established players with strong aggressive strategies already in place and working.
The problem is that the Japanese companies aren’t really in any power position at all on the playing board. Even if they decide that building LTE cellular technology into cameras is the right thing to do (it isn’t), they have to go to companies that are commanding the consumer’s vision to get access to those mobile networks. If they want better integration with smartphones, the same thing applies. The camera companies aren’t in a good position to make a good deal if they try the “alliance approach.”
Worse, an alliance approach is often making a bet on another player. Do you pick iOS or Android? Do you pick AT&T or Verizon (in the US)?
The current approach by the camera companies is being non-preferential followers (and laggard followers at that). As in don’t pick a particular alliance, but be equally supportive of both iOS and Android as much as possible. Virtually everyone now has WiFi connected apps for the mobile platforms, though they don’t always do a lot or perform all that well.
I would guess that the proper approach is being preferential and supportive. By preferential, I mean pick a partner and co-brand as much as possible. By supportive I mean that you have to drive customers to the bigger partner. Back when Apple had Aperture active, any of the camera companies could have abandoned their raw converter and image browser aspirations and went with the “works best with Apple Aperture” approach. Of course when you’re the smaller player in a partnership like that, you sometimes get your head cut off, as in Game of Thrones. Still, you have to place your bets somewhere. The camera companies are currently placing small bets on both red and black. Not sure how you win, let alone win big, with that strategy.
The smaller camera companies have nothing to lose. Fujifilm, Olympus, Panasonic, and Pentax could all saddle up to a strong mobile partner and play the preferential and supportive partner.
To a small degree, Leica has done this with Adobe, choosing to bundle Lightroom and work with Adobe on their odd-ball data such as from the Monochrom, instead of rolling their own software. Right play, and it keeps them concentrating on the thing they do best, which is optics and hardware. It doesn’t appear, however, that Leica has tried to play that card further, though. There really should be a “works best with Lightroom/Photoshop” aspect to what Leica is doing rather than just a bundle.
Canon and Nikon have a bigger problem. They’ve gone it alone against the smartphone onslaught for most of a decade now and have gotten beaten back while trying to do so. Their pride keeps them thinking that they’re the center of photography, but the reality is that they no longer are. Which means that they’re moving more and more towards a niche product vendor status and further away from the mainstream of imaging.
Sony meanwhile, has a mobile phone group. As usual, Sony seems to have a real tough problem getting groups within the company to cooperate and create something “bigger.” For instance, they could make the Xperia phones and Powershot/Alpha cameras absolutely seamless and fully integrated. Have they? Not really.
Meanwhile, another annual ritual also brings further things to comment on: Mary Meeker’s annual Internet Trends analysis, a dense pack of annotated presentation slides about the current state of the Internet.
Ms. Meeker didn’t have as much to say this year about still imaging as she did last year, but if you look carefully through the 197 slides (!), you'll find a couple of key points that have to worry camera companies:
- Slide 26: “Mobile Usage Evolved Rapidly: Text -> Images -> Videos -> All of Above.” As bad as dedicated cameras are at sharing still images, they’re worse at sharing video. Far worse. So not only is the trend line with smart mobile devices putting pressure on still image creation, it’s now doing the same thing with video creation. The camera companies aren’t one play behind in the game, they’re two plays behind and getting be-hinder.
- Slide 70: “44% of Millennials use the camera in their smartphone every day.” What they’re using it for is mostly posting on social media (76%), but the other things they use it for have to be shocking to camera makers too: 34% deposit checks by photographing them. Try doing that with a dedicated camera! Again, the camera makers are not only late to the game, but the game is changing before they get organized on the sideline.
- Slide 82: 3.4m drones will be shipped in 2015. That would compare to maybe 30m compact cameras. While not all those drones will have built-in cameras, one really has to wonder about why the camera makers are stuck with their boxes up against the user’s face and at their eye. GoPros mount anywhere. Drones are taking cameras into the sky. Simply put, camera makers don’t really see cameras as anything other than what they were for almost a century: a box you hold in your hand and point. As image sensors become more and more ubiquitous (some cars now have a dozen), the notion of a stand-alone box you hold is just way too limiting. Not only are the camera makers playing from behind, but they’re playing with an out-dated concept of the game.
- Slide 193: The camera companies keep saying that the emerging markets will be their savior. But look at Internet penetration >45%: China, Brazil, Russia, Iran, Egypt, and Turkey are all in that list. Sharing images via smartphone is going to be big in those countries compared to buying dedicated cameras. But even if you look at the next slide, where Internet penetration <45%, look at the growth in penetration in India, Indonesia, Nigeria, Kenya, etc. The trend line is towards plenty of Internet usage in those countries, too. This rolls over into the smartphone penetration slides that come next, too. As ubiquitous as we see smartphones here in the US and Europe, the same is going to be true worldwide in the not so distant future. Thus, cameras absolutely have to learn to play in this environment. Images taken with cameras must be able to easily get from camera to phone, camera to computer, camera to Web site. I’d argue that they do none of that well today, not even camera to computer.
So again, the camera companies aren’t playing offense, they’re playing catch-up defense. And poorly. This is management failure, basically. Every one of the camera companies has the engineering talent to build state-of-the-art cameras for the 21st century. The fact that they’re not means someone is telling them not to. That would be management.
Time to fire the coaches and get ones that will have the players working on a better game plan.
