The State of the Industry!

Oh boy, oh boy, these are fun posts to write. Less fun, I expect, to read, but it's not always about you, ok?

Ming Thein is still half-heartedly grinding out a blog about photography, but you can tell his heart really isn't in it. He's a watch guy, now. Anyways, he recently shared one of the Pundit Standard posts that guys like him have been writing for a few years, apparently a column for Medium Format magazine. In it he writes about how terrible the camera industry is at everything and how they need to innovate and (implied) that if they just let him run things they could revitalize the whole sector, because he has insights.

Thom Hogan apparently makes a living writing this piece over and over. Michael Reichmann was known to bang this piece out from time to time.

All of them are wrong, and staggeringly so. Which is weird, because the one common thread here is claims to great business acumen.

First some sales numbers.

Camera sales, "serious cameras," bumped along at a few million a year for a decades. Polaroids and other convenient form factors bumped along at somewhat higher numbers, with counts gradually trending upwards. In about 2000 digital cameras show up in a couple form factors, and general upward trends continue. A couple years later a few things happen. Flickr and its friends arrive and get some traction, digital cameras get better and better while prices remain flat, and suddenly a GIANT FUCKING BUBBLE SHOWS UP. There is a huge surge in camera sales, peaking around 2010, and dropping thence into what might accurately be called free-fall.

We have a couple obvious factors in play here.

There are people who Just Want Pictures. A few of them bought Nikon film cameras and whatnot, but a lot more bought Polaroids and Kodak disposables and the like. This is most people who take pictures. There are the anoraks, they actually just like cameras. They bought Nikons and Hasselblads and Mamiyas and stuff. Some of them also like pictures, but that is secondary to this market discussion.

From maybe 2004 to 2015ish, we also have what can be described as a fad. The internet and the sharing of photos was a shiny new thing. You could get in to it for under a $1000 or so! Maybe you could... make money? Share with friends? Become cool? Nobody really knew, but it was the It Hobby among a certain set for a while.

That is over. The fad has died, nobody gives a shit any more. We're back to people who Just Want Pictures and people who Like Cameras. The former use smartphones, because they serve that need beautifully well. The latter constitute a market of a few million units a year. That Thein does not see this is incredible to me, because he's literally a child of the fad portion of this. His interest in photography precisely waxed and waned with the fad portion of the market. I guess the guy with the giant collection of pet rocks isn't willing to admit that pet rocks are over, even when his own interest fades?

The bubble inflated a few companies to immense size. The anoraks want the bubble to go on forever, because they are emotionally invested in the importance of Cameras, I guess, so you can continue to sell idiotic articles like Thein's.

Canon and Nikon are not engaged in an effort to revitalize this market. This market is a sinking ship. Nobody knows when it's going to break up and vanish into the inky depths, and everyone wants to keep it afloat as long as possible, because what they are doing is a salvage operation.

The goal is to get as much cargo off the ship before it goes under as possible.

Nobody is going to make an announcement to the effect that the industry is fast-returing to 1970s levels, because that's how you burn a billion dollars in future revenue. Also, everyone is sort of hoping that everyone else is wasting a lot of effort trying to revitalize the industry. Indeed, there are probably people inside the majors who are keeping an ear to the ground, looking out for an unpredicted new trend to ride.

The bulk of the effort is split between extracting revenue from the remains of the current market, and positioning the company for dominance in the new, much smaller, future market. Unwinding a massive house of cards is hard but it's got to be done.

Thein is exactly wrong. Growing a set of balls and taking some big design risk is not going to save this market, and anyone with a hint of, you know, actual experience in business knows this. Right-sizing the company, paying down technical debt, and generally positioning for a leaner future, is the right approach. Nikon has been doing this for a long time, they still have their files from the 1970s and before, I assume.

Also, it's OK to be an anorak. It's kind of cool that we've shed all those fadsters, all they want to talk about is their new gear, anyways.