Mirrorless Takes Another Hammering

Started May 17, 2013 | Discussions
John Koch Senior Member • Posts: 1,138
Mirrorless: Catch 22

Camera manufacturers are either losing money or making less money.  Critics suggest that they cut the prices, in order to sell more.  But that simply means more losses if the margins ar negative.  Other critics say the cameras should be accompanied by more high-end features, which would simply cannibalize DSLR sales.  There is no win-win solution, folks.  Smart phones are picking up market share and gouging the camera business across the board.

It should be obvious to all that the P&S market has imploded and the loss of revenues on consumer cameras can't be good for the high-end market, either.

There is no evidence that any manufacturer of mirrorless NEX or m4/3 has reported a real profit on those product lines, per se.  None break out the margins, segment by segment, for the simple reason that there is no reliable way to apportion the shared costs.  The quarterly reports will always cite some double-digit rise in sales for a new product, which is meaningless if the base is zero (since it is new), and profits for the imaging as a whole still drop or turn negative.

See page five of the Olympus report.  I thing people are deluded by discussion of units of new models or revenues alone.  Look at the operating margins.  In the case of Olympus, which has lots of debt, it's also important to consider debt expense, which is charged after operating costs.

http://www.olympus-global.com/en/common/pdf/financial145PBe_2.pdf

Sony would still be losing money, too, were it not for the entertainment segment, which an activist investor wants the group to spin off.

Panasonic is mired in a similar fix.

Nikon and Canon get by, but can't be happy with the prospects for cameras.  The decline may be permanent.

ed2002 Regular Member • Posts: 254
Re: found: mirrorless was not profitable

Thank you very much for the full quote.  Some made it sound like mirrorless were responsible for all the loses.:-)

I don't think digital cameras are a good place to be right now in terms of profitability.  IMHO the worst place is 1/2.3" sensored cameras with less than 10x zoom.  The larger sensors look a little better, but still money losing.  The large zoom range may be able to be profitable.  DSLRs are money losing proposition in the long run, as phones get even better and mirrorless.  If you are going to make money, I would bet on mirrorless, but..... there are 5 systems out there, and olympus looks like it is badly managed.  There is money to be made in the future, but I would not bet on olympus winning, but it and sony are in the best position today.

Just Having Fun Veteran Member • Posts: 3,869
DSLR sales falling that fast??

Jeff wrote:

rattymouse wrote:

As seen at sansmirror.com, the final numbers are in for mirrorless last year and the results are NOT pretty.  The main mirrorless players are either losing enormous money (Panasonic and Olympus), losing some money (Fujifilm), or barely eeking out a profit (Sony).

Canon and Nikon are profitable, but it is virtually certain that their DSLR sales are carrying that load.

Another bloodbath for the mirrorless makers, leading to the question, will they all survive until next year's financial reports??

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9 years of Fujifilm camera usage, ended by rampant fanboyism.

I've slightly reformatted my chart from earlier in this tread to better show shipments of mirrorless cameras as a portion of the the shipment of all interchangeable lens cameras.  This is data from CIPA for worldwide shipments of interchangeable lens cameras by month since Jan, 2011.

To me, this doesn't look like a hammering for mirrorless cameras.  There does appear to be a problem with channel stuffing prior to Christmas, 2012, which may be the reason you kind find such good deals right now.

And, ss I said before, there may too many camera makers to survive in this narrow niche. Getting squeezed from below by the smartphone tidal wave, and from above by Nikon and Canon is a bad place to be.

To my mind, the strategy flaw is not in the developing this market per se, but in not more directly targeting the 100's of millions of users of those smartphones to higher levels of visual expression. They are not going to be impressed by f-stops and shutter speeds. They need to have a path to better pictures.  Sort of like what Steve Jobs brought to the computer industry.

If you remove the mirrorless sales(blue) and those last few DSLR sales columns drop.  It looks like a steady fast decline for DSLR sales.  Is that correct?  The peak would be back in 2011 and from June 2012 it would be all down hill.

Is that correct?

OP (unknown member) Forum Pro • Posts: 13,144
Re: Mirrorless: Catch 22

Fujifilm is also losing money in their Imaging Solutions divisions.  10 years of heavy losses and counting.....

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9 years of Fujifilm camera usage, ended by rampant fanboyism.

ed2002 Regular Member • Posts: 254
Re: I think SLR sales will take a "hammering" soon, too.
1

rattymouse wrote:

GeorgeD200 wrote:

I think that DSLR sales will be dropping rapidly soon also.  I don't have hard numbers to back this up -- it's just a hunch, but I am "in the business."

DSLR sales are dramatically out pacing mirrorless and that is growing, not shrinking.

DSLR shipments dropped last quarter more than mirrorless.  Both gained market percentage if you don't include phones as cameras.

http://www.cipa.jp/english/data/pdf/d-201303_e.pdf

DSLR market share is much higher than mirrorless.  2,600,765 for DSLR versus 603,532 for mirrorless shipments in Q1 or calender 2013.  This represents yoy decreased of 23.2% for DSLR and 18.5% for EVIL, but we should be cautioned that shipments do not equal sales.  Everyone likely shipped too many cameras in Q4 of 2012.   This has EVIL 18.8% of ilc.

It seem quite clear that EVIL is growing in market share, but this is a slow gain.  I would not expect EVIL to be half of ILC for at least 5 years.  Technology will also help push the ff side of DSLR further, but sony may produce a ff evil, that could be prefered for studio or landscape work.

The average consumer equates SLR's with quality over mirrorles.  That is clear as day here in China, where 90% or more of the cameras found in shops are SLR's and mirrorless is hard to find.

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9 years of Fujifilm camera usage, ended by rampant fanboyism.

I think this is one of the funny things I read shopping.

http://www.woot.com/offers/nikon-16-2mp-dslr-camera-w-18-55mm-lens?utm_medium=affiliate+-+woot.com&utm_source=Commission+Junction+Publisher+-+3006718&utm_campaign=Commission+Junction+-+10836818

You could snap pictures with your iPhone like everyone else, but by having a DSLR you'll really look like you know what you're doing. And isn't that what photography is all about? Your friends will ooh and ahh When you detach the included AF-S 18-55mm zoom lens. "Wow, that's like, a real camera!" they'll exclaim. Yes, yes it is.

I'm sure some buy dslrs for looks alone.

MichaelKJ Veteran Member • Posts: 3,466
Re: DSLR sales falling that fast??

Just Having Fun wrote:

Jeff wrote:

rattymouse wrote:

As seen at sansmirror.com, the final numbers are in for mirrorless last year and the results are NOT pretty.  The main mirrorless players are either losing enormous money (Panasonic and Olympus), losing some money (Fujifilm), or barely eeking out a profit (Sony).

Canon and Nikon are profitable, but it is virtually certain that their DSLR sales are carrying that load.

Another bloodbath for the mirrorless makers, leading to the question, will they all survive until next year's financial reports??

-- hide signature --

9 years of Fujifilm camera usage, ended by rampant fanboyism.

I've slightly reformatted my chart from earlier in this tread to better show shipments of mirrorless cameras as a portion of the the shipment of all interchangeable lens cameras.  This is data from CIPA for worldwide shipments of interchangeable lens cameras by month since Jan, 2011.

To me, this doesn't look like a hammering for mirrorless cameras.  There does appear to be a problem with channel stuffing prior to Christmas, 2012, which may be the reason you kind find such good deals right now.

And, ss I said before, there may too many camera makers to survive in this narrow niche. Getting squeezed from below by the smartphone tidal wave, and from above by Nikon and Canon is a bad place to be.

To my mind, the strategy flaw is not in the developing this market per se, but in not more directly targeting the 100's of millions of users of those smartphones to higher levels of visual expression. They are not going to be impressed by f-stops and shutter speeds. They need to have a path to better pictures.  Sort of like what Steve Jobs brought to the computer industry.

If you remove the mirrorless sales(blue) and those last few DSLR sales columns drop.  It looks like a steady fast decline for DSLR sales.  Is that correct?  The peak would be back in 2011 and from June 2012 it would be all down hill.

Is that correct?

DSLR shipments for the first three months of 2013 were down 23% from shipments for the first three months of 2012.  Bear in mind that, while shipments and sales are related, they can deviate significantly over short periods to time.

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Richard Veteran Member • Posts: 4,858
Re: I was talking new cameras.

LincolnB wrote:

Richard wrote:

LincolnB wrote:

Doesn't matter if you can't make a profit on them. The biggest thing holding back mirrorless is price. If it was 200-300 dollars, I would buy one...

These were taken with my $299 DMC-G3 with kit lens:

Not discontinued or used. You cannot find the EP2 or this camera for 299 new with lens.

Amazon has the E-P2 body for sale for $210. Ebay is full of sales of the kit lens for around $80. If you can't find a lens for a micro four thirds camera for less than $100 then you're not looking very hard.

You should look for me. There are only 4 left at 209 which tells me this is a discontinued model. You can find deep discounts on any discontinued model. My point was that they are not making any money on these.

I bought the G3 with lens for less than $300. Do you need to see the receipt?

Good for you, I generally on't buy discontinued models.

I made the point that it's easy to find a micro four thirds camera for the price you range you quoted. I made that point easily.

My point was that they are not making money on these. Read the topic. Mirrorless takes another hammering. I am happy that you have found a new camera for cheap. We all look for that but if they continually have to blow out old stock, they will go unders.

Oh, so it has to be brand new, the very latest camera, it has to be as small as a compact yet perform as well as a DSLR, it has to include a lens, oh and the manufacturer has to be making a profit on it while still keeping the price under $300. Any other restrictions you want to tack on before you'll buy? Or do you want to keep moving the goalposts?

It is not about goalposts. Read the topic. I said that mirrorless is over priced for what it is. It is a tweener camera that has no real fit, to big to be a CC to expensive compared to a APS-C. That is why they are taking a beating. I am not saying you cannot find a good deal. You can on APS-C when they have an overstock of previous years models.

Sure B&H shows them for that price but you cant get one, it is discontinued. Even if you could, manufacturer is not making money off of it. It is trying to unload the old garbage so the new stuff will sell.

So you think the G3 and the E-P2 are garbage, beneath your photographic skills?

Garbage as in last years garbage, we are talking about new models the company can make money on and the new models are a lot more expensive than your 209 dollar Amazon close out special. I could take pictures with a disposable film camera.

Richard Veteran Member • Posts: 4,858
Canon will survive this business model

LincolnB wrote:

zxaar wrote:

So may be the best time to buy OMD would be 3 years from now.

It would be better if m43 companies also advised this to their buyers and also put a note: Best time to buy our camera is after 3 years of their release date. Don't buy the just released cameras , we priced them such that after 3 years they will be selling at their right prices.

That's essentially what camera companies are saying with their pricing. You can buy the latest and greatest Canon Rebel T5i for $750 or you can buy a T3 for $340. You can buy an Olympus E-P5 for $1,000 or if you're more budget-conscious you can buy an E-P1 for $290.  Do they really have to spell it out for folks in big, bold letters???

Canon will survive selling old "garbage" 3 year old models for $340 but Oly can't. They can't make enough money on the new model or sell enough volume to cover the discounts on old stock. That is the point of the post. Mirrorless takes another hammering.

I don't want m43 to go away, I think choice is very important even though it may not be my choice. But the reality is the company is struggling and a 209 dollar camera is not helping things.

Richard Veteran Member • Posts: 4,858
Re: Chef Ramsey.. (Bleep) me

Ulric wrote:

Richard wrote:

The biggest thing holding back mirrorless is price. If it was 200-300 dollars, I would buy one, but when they cost the consumer more than a DSLR with lens, they at best will only remain a niche market, or they will take down the imaging dept of the companies that sell them through no profit.

They don't. Comparable models cost about the same. $200 isn't going to get you a very good, latest model mirrorless, but it isn't going to get you a very good, latest model DSLR either.

I agree, but Canon will survive a cut throat business model while Oly struggles. That really is the only point. Again. I don't want m43 to go away, but unless their cameras perform as good or better for a lower price, they will not be competitive against DSLR, which is their main competitor, they are too big and expensive to be compared to CC or camera phone.

zxaar Veteran Member • Posts: 4,153
Re: Mirrorless Takes Another Hammering
5

Ulric wrote:

vzlnc wrote:

Ulric wrote:

vzlnc wrote:

People worried about size have better alternatives than the overpriced junk.

What overpriced junk? Cameras that cost and perform like a DSLR, but is lighter and smaller?

A little correction there. Cameras that cost A LOT MORE and perform LESS than a DSLR.

You keep repeating that. Keep trying until you get it right.

It does not need any repeating, anyone who is not fanboy and not in denial knows that.

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::> I make spelling mistakes. May Dog forgive me for this.

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