Olympus trys to Calm our fears once more

Started Feb 14, 2013 | Discussions thread
Craig from Nevada
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Re: Olympus trys to Calm our fears once more
In reply to alatchin, Feb 14, 2013

alatchin wrote:

Craig from Nevada wrote:

In the short-term, the easiest way to stem this trend is to cut the losers. I suspect that the point and shoot line is killing them. I think it is killing everyone.

I agree here... Stop the slew of soso compacts and try to create something this new generation of camera-phone photographers would want... It should probably play MP3s

The idea of a modestly priced, but profitable, point and shoot is dead.  These cameras require lots of market and name recognition. Something Olympus doesn't do.

The OMD was clearly a success as it was selling very well. What their profits were is a mystery to all. Just to note, a couple of hundred dollars in difference combined with a large size difference is reason enough fro a sale.

Selling lots of cameras and making a profit are not the same things.  The profits on the OMD can't be high.  That camera is worth a couple hundred dollars more than they are charging.  No one is close with this camera.  They are selling OMD, but the losses for the imaging division are growing. Is there a relationship here?  I don't know, but OMD sales have not put the imaging division on the path to profitability.

Olympus in response will sell you a bunch of very fast primes. The 75mm is by all accounts a really great lens. Nice if you are upper level but for the hobbyist? I don't know. They need a broader line of lenses to appeal to a broader range of customers.

This contradicts what you are saying about pricing... There is no broader level of consumers buying cameras anymore. This is the problem, Olympus produces a cheap lens and it is panned for performance, they produce a nice lens and it is panned for price.

Not really a contradiction.  What I need is a 7-14mm lens, a 14-35mm lens and a 35-100mm lens--fast with decent optics that is weather sealed for hiking and travel.  Panasonic has me out the door for about $3,000 with a decent kit of lenses.  I don't need a bag full of primes, other than a macro.   Throw in a decent camera for about $1,000.  GH3 looks about right in terms of size.

This comes back to four-thirds. Where does it fit into all of this in 2013? Well they have a pretty nice line of lenses for all customers segments (standard, high, and super high grade), but no cameras. The only market for these lenses right now is the used market. They can't be selling many new lenses when the price differential is so great between used and new (all the people jumping to canikon). I can't see how they can reinvigor the DSLR lens sales with a new camera. It may stablize the prices for used lenses, but to what end?

Say Olympus knew they sold 200,000 E-3s and 100,000 E-5s (just a guess) worldwide, add to that 100,000 E-30s and 100,000 E620s, through their repair centres they have some knowledge of a userbase, and they have any additional lens sales... If they were to produce an E-7 and they assume that only half of the previous buyers of E-30, E3 and E5 would pick it up... so ONLY existing Olympus customers, they would sell 200,000 units.

Add to this a smaller 620 style body which would allow all those m43rds users who want to access a number of 43rds style lenses such as the 12-60 or 50-200 you would have potential buyers form existing 520, 510, 420, 300 and E-30 users as well as a few trickle up buyers from m43rds... I mean you can get those two lenses from Olympus over the Panasonic lenses and probably the difference would cover most of this body.

Considering almost all the R&D has been done, and you know you have this potential customer base of die hard users... what would you do?

What would I do?  Stop the bleeding.  Cash is everything. As for your suggestion, I think Olympus is a day late and a dollar short on the DSLR program.  People have moved on.  The E-30 and E-620 users were stranded.  If I wanted to upgrade from entry level to the middle level, I would migrate to Sony, Nikon or Canon.   If I wanted to stay at entry level, I would be a used E-620 or E-30 for my standard lenses.

A strategy would be give away the blades to sell razors. In this case, they slash the prices of HG and SHG lenses while selling a camera with some serious mark up. The lenses would be priced to compete with Panasconic lenses. We see used four thirds prices for a SHG 7-14mm falling to levels where they equivalent to Panasonic 7-14mm lenses. High grade lenses, they have no market right now. This all seems dubious to me.

You assume they are making no money on the bodies they are selling, that is a bit of a hole in your thinking. Added volume gives increased cash flow, better purchasing power increased profits (if we assume they are making profits) and a stable userbase for projected sales.

They are not making money on the bodies. I don't think they ever have made money on the bodies during the big days.  If they were making money on bodies, they would not have abandoned the business.  Yes, no cameras for entry and mid-level users is abandonment.

I think long-term, there will be a serious consolidation of manufacturers. Many are bleeding. The "For Sale" sign should be out at Olympus. It will look like the airline mergers we have seen recently.

Considering everyone has their own line, any merger would simply mean the end of 43rds and m43rds. Why would Sony have NEX, and Alpha, both of which they are struggling with, and then bring on a new mount which by all accounts is also no making any money?

Yup.  It depends on the value of the intellectual property held by Olympus imaging.  There needs to be few cameras and fewer mounts. That is what will come out of this.

I see a merger announcement more likely than a DSLR. A new DSLR won't stop the bleeding.

If there is a new camera in the thrid quarter and a very pricey adapter to use 4/3rds. Olympus declares the goal of "one beautiful system" has been achieved and the imaging division is bought out.

A very pessimistic view. More sales will stop the bleeding, or higher prices. More sales seems unlikely as the market is saturated. Higher prices are what we are seeing in m43rds lens options and look how well that is being received... And the idea that Olympus feels they will sell buckets of adaptors for say... $500 to their most invested customers is a stretch... I dont see why people think Olympus is going to be so willing to drop their entire suite of lenses, at a time they are making no money in cameras, and start rebuilding, and redesigning these lenses in m43rds.

m43rds will get lenses, but when a 12-60 comes out and it is either slower, or has worse performance than the existing 12-60... while costing the same or more... How many will they sell? Panasonic is hardly rolling in cash despite its 12-35 and 35-100 (both of which are outperformed by the cheaper 12-60 and 50-200)... Put it this way, you need sales, you have existing customers who have some real incentives to upgrade (new sensor, new IBIS, more MP, and better video) and you release an adapter? Doesnt add up. That is probably why Olympus is being so vocal right now, because they have a camera or two in the pipeline.

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“You don’t take a photograph, you make it.” -Ansel Adams
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The market is flooded with cameras.  The margins are very low and everyone is losing money. Higher prices can only be sustained if there is a better match between the number of buyers and sellers.  Too many cameras are now chasing too few buyers.

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