Increased Quality and Lower Prices Enhance Mass Market Appeal for Digital Cameras, IDC Says.

Worldwide Digital Camera Sales Will Approach 4.7 Million Units in 1999.

PRNewsWire: After years of modest success performing limited tasks in niche markets, digital cameras are on the verge of a mass-market explosion. According to new research from International Data Corporation (IDC), once-common inhibitors are breaking down, opening the door for a new set of consumer applications that will drive worldwide digital camera shipments to 4.7 million in 1999 and an astounding 22 million by 2003.

"With falling prices, increasing quality and resolution, and new applications, digital cameras have begun to attract the attention of the average consumer,'' said Kevin Kane, research analyst with IDC's Digital Cameras and Scanners program. "The next several years will be key in determining what part digital cameras will play in leisure and business budgets and activities worldwide.''

Prices for digital cameras have been in a precipitous decline over the past year, and IDC believes the cost of owning these devices will continue to fall. "The main factors in the steep price decrease are improvements in manufacturing capabilities and the development of economies-of-scale as well as the decreasing cost of components such as sensors and memory,'' Kane said.

Because of the falling prices, digital camera shipments will increase at a compound annual growth rate (CAGR) of 48% through 2003 while revenues earn a slower 25% CAGR. IDC expects the worldwide market will total $6.4 billion in 2003.

IDC segments the overall digital camera market into soft display cameras, basic point-and-shoot cameras, photo-quality point-and-shoot cameras, professional mobile cameras, and pre-press, portrait studio cameras. The photo-quality point-and-shoot segment is the impetus behind the overall market's growth. "Small and medium-sized business owners often purchase these cameras for work but make use of them at home too. As a result, more high- quality digital cameras are making it to the consumer market than ever before,'' Kane said.

According to IDC, digital camera use is more prevalent in the U.S. and Japan than in other worldwide markets. The two markets, however, look for very different traits in these products. U.S. users value simplicity in camera design while the Japanese prefer compact, feature-rich devices.

IDC's report, Worldwide Digital Camera Market Review and Forecast, 1997-2003 (IDC #B99S2172), provides a comprehensive view of the market at every level of price and functionality. IDC splits the market into five segments and examines each thoroughly. The report presents market forecasts by technology and region (U.S., Japan, Asia/Pacific [excluding Japan], Western Europe, ROW). It discusses key trends and competitive dynamics. To order a copy of the report, contact Sue Beauregard at 1-800-343-4952, ext. 4774 or at sbeauregard@idc.com.