Reality check: Americans don't buy mirrorless - and Sony profits show it

Started Jul 10, 2013 | Discussions thread
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Mel Snyder
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Reality check: Americans don't buy mirrorless - and Sony profits show it
Jul 10, 2013

USA Today ran an interesting article, 'Mirrorless camera sales don't reflect potential" last month. Sales of all mirrorless cameras in the U.S. in April were hideous:

"Of the 1.8 million cameras shipped in the Americas (not just the USA) in April, a measly 38,843 of them were mirrorless — 2% of the total."

"Measly" was the writer's word, not mine.

Since Sony's share of the mirrorless market is measly, I decided to check Sony's annual report for 2013 (their fiscal year ends March 31).

Their imaging products group reported sales about flat for the past 3 years, in the 400 billion yen range, but 2013 profits of 1.4 billion yen, down from about 5 billion yen the year before, and about 18 billion yen the year before that. The company reports it is doing everything it can to cut costs - outsourcing design as well as manufacturing, closing factories and - horror of horrors in the land of lifetime employment - slashing payroll.

The word "camera" never appears once - not once - in their entire annual report.

Sony is under great financial pressure. Its biggest investor, Dan Loeb, who owns 6% of Sony stock, more than management and the board of directors combined, is pushing hard on the company to spin off all but its profitable entertainment and music businesses - and while his pressure came too late for this year's annual meeting, when you have Loeb's money, other shareholders listen.

Sony isn't Leica - Leica's camera group is owned by a guy named Kaufmann, a wealthy German investor living in Salzburg, Austria. His family made its wealth in the pulp and paper business. He has pumped way north of 100 million Euros from that business into his part of the company to stave off bankruptcy. Their sales are probably less than 40 million Euros/year. Leica is his hobby. He doesn't make a dime off the name "Leica" on Panasonic lenses - that's just a name licensed to Panasonic by another part of Leica he doesn't own, that doesn't design or make lenses - just sells the brand name.

Look closely at this part of the USA Today article:

It's not for a lack of trying — mirrorless manufacturers continue to introduce full-featured cameras in a variety of styles across a range of price points, and there's never been a better time to be a photography enthusiast. Fujifilm has endeared itself to enthusiast photographers with its retro-styled X-series cameras and high-quality lenses to match. The Micro Four Thirds system, shared by Panasonic and Olympus, has dozens of camera bodies and lenses to choose from. Even professionals are adopting Micro Four Thirds cameras — particularly the Panasonic GH3 for its top-notch video capabilities.

The top-selling mirrorless camera system home and abroad, the Nikon 1, might have the least-impressive technical credentials, but it's inexpensive and stylish. Nikon's ads have star power in the form of Ashton Kutcher, which probably helps to raise consumer awareness. Not every camera company can afford to splurge on such a popular spokesman for a still-developing market segment.

Panasonic's Pepple acknowledged that awareness is key to influencing buying decisions. "We are, of course, doing as much as we can to educate the market." But as mirrorless sales in the USA decline after less than five years in stores, it's starting to look like the genre might never catch on.

This forum - in fact, DPREVIEW and similar "enthusiast" sites - are small echo chambers. Out in the real world, mirrorless isn't catching on.

Conclusion: A new NEX-7 is probably real. A full-frame NEX that would look anything like today's small models - unlikely. Sony management must know the fantasy is coming to a end, even if NEX fanboys like us don't.

Sooooo....let's enjoy what we own.

 Mel Snyder's gear list:Mel Snyder's gear list
Sony Alpha NEX-6 Sony Alpha 7 Sony E 16mm F2.8 Pancake Leica Summicron-M 50mm f/2 Sony E 55-210mm F4.5-6.3 OSS +12 more
Panasonic Lumix DMC-GH3 Sony Alpha NEX-7
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