Cell phones make classic cameras unnecessary – the situation looks so bad
Because smartphones always enable better photos, the demand for classic cameras has been falling massively for years. Now a first traditional manufacturer has given up. More could follow.
2021 could have been a big year for Olympus. Then the presentation of the first camera from the traditional manufacturer would have been 85 years old. A remarkable number that could have been celebrated with an anniversary. It won’t happen. Instead, Olympus gives up the camera business after 84 years.
After Kodak, another big name says goodbye to the camera business. But while Kodak simply slept through the switch to digital cameras, Olympus falls victim to a technology that all manufacturers struggle with equally: smartphones.
Sales figures have plummeted
Ever since the smart phones saw the light of day, they have been making life difficult for the camera industry. From 2010 at the latest, camera sales dropped drastically almost every year. For example, sales worldwide shrank from 121.5 million units in 2010 to just 15.2 million in 2019. Camera manufacturers can only dream of sales numbers like Apple, which sell between 40 and 70 million iPhones in three months.
From 2010 to 2019, camera sales decreased 87 percent. Image: watson | source data: statista
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A look into the past shows how disruptive smartphones are for the camera market. In 2006 there was still a spirit of optimism in the industry. The digital photo age promised high profits and attracted large electronics companies. Sony incorporated Minolta and started its successful Alpha series to date. Panasonic and Samsung also tried to establish themselves as camera manufacturers. In the meantime, Samsung has realized that the future lies with smartphone cameras and has withdrawn from the market. Panasonic is still active, but its followers have been waiting for a new camera for around a year and a half.
Even “professional cameras” are not the answer
Thanks to several lenses and software, smartphones are now taking such good photos that laypeople are satisfied with it. This goes so far that camera manufacturers are increasingly breaking out of the entry-level market for system cameras. Many hobby photographers who used to buy a cheap entry-level DSLR «to take professional holiday photos» are now satisfied with a good cell phone.
Modern smartphones already do a lot when it comes to the camera from the middle class. That is enough for many users. Image: watson
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The industry tries to counter this with various innovations. Ever better mirrorless system cameras, new sensor sizes, tremendous zoom. So far, it hasn’t really worked. Nikon had to see that too. With their new Z-series they wanted to start again in 2019 and advertised full-bodied with “mirrorlessly redefined”. It didn’t help much and the Japanese had to admit that they overestimated the demand.
Is Nikon the next victim?
How much Nikon apparently misjudged the market became apparent at the end of 2019. The company had to accept a historic drop in sales of 18 percent. Particularly bitter: While other manufacturers can cross-finance their camera division through other business areas, Nikon is almost completely dependent on the camera business.
Leica is one of the few camera manufacturers who could arrange themselves with smartphones. Thanks to a partnership with Huawei, the German premium manufacturer has managed to gain a foothold in the smartphone world. Huawei has now become the second largest cell phone manufacturer in the world. This collaboration is likely to have contributed somewhat to the fact that Leica has been able to hold up reasonably well in the camera business despite the high price strategy. Allegedly License income Leica generates through Huawei is said to even account for a significant portion of sales.
Corona provides another low blow
The future for the camera market doesn’t look much better. Already in early 2019, Canon predicted that the market would shrink by a further 50 percent by 2021. At that point, the camera manufacturers had no idea that Corona would be hit by another low blow a year later. First Analyzes show that the camera market collapsed by around 52 percent in March 2020. In Asia, the delivery volume was only around 40 percent compared to the previous year. Although the smartphone market has lost almost 20 percent, cell phone sales are likely to pick up faster than camera purchases.
It seems understandable that Olympus pulls the plug with such bleak future prospects. September will show whether the camera brand will really disappear completely. Then the Olympus camera division will be sold to Japan Industrial (JIP) Partner. In 2014 the company had already bought out the Sony notebook division and thus the VAIO brand. Nobody currently knows whether the company is allowed to continue using the Olympus camera brand or is only interested in the patents. Nothing is dry at all until the purchase contracts are not signed on September 30, 2020.
In the future, Olympus wants to concentrate entirely on its business with medical technology, a market that is likely to be very profitable even in a decade.
