THURSDAY AT PMA
IDC Captures the Industry's PortraitBy MIKE PASINI
The Imaging Resource Digital Photography Newsletter
We managed to get up at the crack of dawn to attend IDC's (http://www.idc.com) breakfast meeting where three presenters discussed "Digital Photography 2.0 -- Planning Your Products for the Next Digital Wave."
IDC actually does some research to develop a picture of what's going on in the business. We find that a refreshing approach.
Natalie Eisner kicked things off by discussing the 50 million unit sales opportunity in, of all places, Latin America.
While Mexico and Brazil make up the bulk of that market, there are other players getting into the game -- and they're all a bit behind the U.S., Japan and Europe in sales so far. Which is why Eisner called it an opportunity.
She made a couple of intriguing points, we thought.
First, Sony (which leads sales in Latin America) is very closely followed by Kodak, which took over second place from Canon in 2004. Olympus, Samsung and HP round out the top five. Not the usual batting order.
Second was her survey data. The main reason -- by a long shot -- Latin Americans haven't bought a digicam is simply because it's "too expensive." Price is simply "the key issue," she observed. We've noted a large number of inexpensive but capable digicams hitting the market recently, just in time to head off the camphone assault, which is having a harder time improving quality and performance than we'd have thought.
Chris Chute followed with a discussion of what people do with their cameras and camphones.
His survey from Sept. 2006 showed the mean number of images captured per month with a digicam (57) was almost three times higher than those taken with a camphone (18), with almost four times as many printed (41 percent vs. 12 percent). But digicam images even beat camphone images in the percent emailed a month (25/16), uploaded (14/8) and enhanced (19/8). The only category camphones prevailed in was the percent instant messaged (8/5).
Last year, he said, sales of camphones topped 508 million units while digital cameras hit 105 and digital camcorders fell just short of 13. The numbers will increase this year, he predicted, with multimedia handsets responding to the increasing desire to upload video.
Those sets will feature two to five megapixel sensors with DVD quality video and be able to directly upload stills and video with rich-media browsing and geo-tagging thrown in. They're particularly attractive because they're the "king of connectivity," providing seamless connections while hiding the complexity of it all from the user. Something digicams have yet to do.
While about half of all digicam and camphone users both take video with their devices, camphone users capture 5.0 clips a month compared to digicam users at just 2.7.
But that's where the good news stops for handsets. They're still largely just one or two megapixel units with significant shutter lag and no flash. DxO, we note, has a solution for some of those problems with software autofocus that can focus as close as six inches, uses no power and is instant.
The threat to digicams is video capture. It's the next big thing, he said. He also noted that 85 percent of U.S. shipments are going to repeat customers as dSLRs begin to cannibalize the high-end segment.
So the question is whether digicams can be competitive with camphone connectivity while maintaining their edge in image quality.
Ron Glaz finished up with a look at digital photofinishing in the home.
Today 56 percent of prints are made at home with 39 percent made by retail outlets and 5 percent online. He expects retail to do about 54 percent by 2010 at the expense of home printing, he said, even though home printing continues to attract new vendors.
Kodak, for example, has just introduced its multi-function inkjet line featuring high quality, ease of use and lower ink costs. But he suspects the company won't be able to modify buying behavior. At the point of purchase the customer will find it hard to justify spending $50 more for a Kodak when ink is just $10 less a cartridge and they use just one a year -- a five year stretch to return the initial investment. By which time, he observed, the unit will no doubt be overshadowed by new technology.
Zink, too, has been bitten by the home printer bug. The company bought the rights to Polaroid thermal color paper technology that can produce a 2x3 inch print for 20 cents. A price that is not quite competitive yet.
The 4x6 printer is attractive because of its print quality and direct-connect convenience. It's usually bought as a bundle or gift (particularly for Christmas, graduation and Mother's/Father's Day). And the mean price is $149.
Price, however, is not the most important factor influencing purchase. That award goes to quality (4.43 on a scale of 1 to 5), followed by a direct camera connection (3.96), then price (3.59) and memory slot (3.39).
The real bottleneck to home photo printing growth, he suggested, was that photos are imprisoned in the personal computer. The industry needs a black box to release them, an eShoebox, that anybody can set up and access at any time, which also backs itself up. Windows Home Server has the right idea, but is too restrictive. After all, he observed, the more images are seen, the more prints will be made.
In the question and answer period following, a couple of interesting observations were added to the presentation.
They expect to see the megapixel race continue into the 12-Mp range and higher if noise can be managed. It's really a question of deploying all those Japanese engineers, they said.
Consumers have 2.2 cards per camera and bite when they see more capacity for around $50. It's a good business to be in with solid-state camcorders just around the bend.