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Lunch with Olympus

- Insights on Olympus' digital camera product line


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On June 22, 1999, Dave Etchells of the Imaging Resource interviewed key members of Olympus corporate management in the digital imaging arena. This is Dave's account of that conversation. (All material (c) 1999, The Imaging Resource.)


Lunch with Olympus
Some while back, we mentioned in our news coverage that I'd broken into my vacation schedule (something I'd sworn not to do) to meet with top Olympus officials in New York, during the PC Expo trade show. (June 18, 1999). It was painful to break into a drastically-overdue vacation, but the lure of speaking with Mr Yusuke (Joe) Kojima, the top executive in digital imaging worldwide for Olympus (General Manager, DI Business Development), was impossible to pass up. Also at the meeting were Mr. Masamichi (Michael) Handa, Group Vice President for Photo, Audio, and Digital Imaging & Systems Group, Olympus America, Inc., and Ben La Marca, Group Vice President, Digital Imaging & Development.
We had a total of two hours together, which proved very helpful in understanding Olympus' approach to the digital photography market, and during which we got answers to several questions we'd had about Olympus' digital camera lineup. Unfortunately, the understanding was that Mr. Kojima wouldn't comment specifically on any future products, including even the recently-announced, but still-mysterious model 2500 SLR camera model. Nonetheless, the conversation was very interesting, and we're indebted to Mr. Kojima for making time in his schedule to speak with us. (Not to mention the excellent seafood lunch he treated us to. :-) Some of our discussion was off the record, and some was more of a rambling, philosophical nature that would probably be of little interest to our readers. (Or at least that would be hard to cast into a coherent text for others to read.) There were a few specific questions and answers that we felt our readers would find illuminating though, or that at least address the factors affecting the makeup of the Olympus product line. Rather than trying to duplicate the conversation, in an interview format, we'll just list here some of the key questions and topics, together with a digest of the responses from Olympus.
Why no full-manual mode on the C-2000 Zoom?

This is one of the top questions we've been asked by our readers relative to the highly-capable C-2000 Zoom. With the range of creative features it offers, and its precise exposure control, many of us were surprised by the lack of a full-manual exposure mode on it. Certainly, the capability exists within the camera hardware to control aperture and shutter times independently, so why weren't we given the opportunity to do so via the user interface?
Olympus' answer to this was quite surprising, and we think reflected a misunderstanding of how their products are actually being received and used by the market: Their position is that the C-2000 Zoom is part of their "Compact" product line, which they see as targeted toward the more-casual user. In their perception, this class of user isn't interested in full-manual control, and providing it would have resulted in a more complicated product that some users would have found difficult to use. While they wouldn't comment specifically on the feature set of the forthcoming D-2500L SLR model, it's clear that they view that product as part of a line targeted at people who care about things like full-manual control.
As we said, we were very surprised by this response: Our rejoinder to them was that, regardless of how they intended people to use their cameras, the fact is that many pros and advanced amateurs are buying and using the C-2000. These people are not only comfortable with full-manual controls, but in fact are clamoring for them! We made the strong point that product-line positioning apart, the people who are actually buying their cameras are looking for features that would be easy to provide. As for the issue of making the camera more difficult for the novice to use, we said "fine, just 'hide' the manual mode behind a menu option, so it wouldn't befuddle the poor "happy snappers." We think that Olympus heard and absorbed these comments, although product-development cycles mean that it would likely take 6-12 months before they could have any impact on the product feature mix.
Where's USB?
This was an interesting one, and we actually heard several answers to it. (Leaving us uncertain what the "real" answer might be, or whether there's simply a mix of reasons for USB's continued absence from the Olympus product line.) We'll present the answers Olympus gave us here first, followed by our own commentary.
Not really Plug and Play.
The first answer was that, contrary to industry hype, the USB interface is far from a true "plug and play" solution, at least at the manufacturer level. While the standard is pretty specific about how the various layers of the protocol are supposed to work, in practice not everyone has been diligent about insuring that their products really adhere to the standard in all respects. The result for a company like Olympus is that they see a fairly high engineering cost associated with each new product they incorporate USB into: Making USB work isn't hard, but guaranteeing that it will work with every other USB device out there is extremely so. (Note that the "plug and play" issue here isn't at the user level, but rather at the manufacturer level, in getting things to be guaranteed-compatible.)
People prefer not to have to attach their camera to their computer.
The second answer was that focus-group studies show that users would prefer to not have to connect their camera to their computer at all. They view the functions of camera and computer as pretty separate, and don't like the idea of plugging and unplugging things from the computer. The preference Olympus heard repeatedly was to have a gadget permanently attached to the computer that read the "film" from the digital camera.
USB reader as solution.
The upshot of all this is that Olympus is viewing their just-introduced separate, USB-based SmartMedia reader as their solution to the issue of providing higher-speed connectivity. They feel this meets the consumer's "real" desires for a permanently-attached film-reader device, and means that Olympus only has to engineer one device for across-the-board compatibility.
Our Thoughts
Much as we appreciate Olympus invitation, we're not sure we either agree with or totally accept the reasons Olympus gave for not including USB on the cameras themselves. Input we've had from other manufacturers suggests that once you get over the initial engineering hurdle with USB, creating successive devices with USB capability isn't really that big an issue. Thus, the "not really plug & play" argument doesn't seem to hold water: It apparently is true that the USB "standard" isn't truly standard in all respects, but from what we've heard elsewhere, you only have to figure out the nonstandard parts once.
On the other hand, we actually tend to agree with Olympus' findings that users would prefer to have a permanently-attached card reader on their computer (at least, that's our personal preference). Our contention though, is that having to pay $80 for an extra reader would put a non-USB camera at a disadvantage relative to one that has USB built in. (We don't have $80 worth of dislike for plugging our camera into the computer...) We suspect though, that we'll see "bundles" including the Olympus SmartMedia reader along with their cameras before too long, especially as the Christmas season approaches. (NOTE though, that this is based on NO comments from Olympus, but rather just our own speculation!)
The "Sweet Spot" for digicam prices/features?

As the price of digicams has come down, the adoption rate by consumers has risen steadily. We've felt for a while that there'll come a price/features point where people will flock to digicams in droves. We wondered if this was Olympus' perception as well, and where they saw that "sweet spot" as being. When we asked the question, we were pleased to see that Olympus' own estimation of the market agreed closely with our own. ('Must mean they're very smart! ;-) They see $299 US as a key target price to hit, but feel that the real key at that price is to include an optical zoom lens. Mr. Kojima was particularly adamant about this point (which we happen to agree with), saying that fixed focal-length lenses tend to produce images with a rather "flat" appearance, and poor three-dimensional cues for the viewer. Letting the photographer zoom in on a subject produces a more natural-looking image. (While we agree with the strong desireability of having an optical zoom lens, for our part we just like the convenience of getting exactly the framing we want without walking back and forth.)
Memory Futures: SmartMedia vs CompactFlash

This was interesting: There's been a lot of ballyhoo and back & forth in the market and on the web about SmartMedia vs CompactFlash memory standards. CompactFlash cards are currently available in larger sizes, and are perceived by many to work faster in storing and retrieving information. There's also a widespread perception in this country that CompactFlash is "winning" the war for dominance in the digicam marketplace. Recently, Olympus joined the CompactFlash standards body, which some had seen as an indication that they were leaning toward the CompactFlash camp.
When we asked about SmartMedia vs CompactFlash, we were surprised at the vehemence with which Olympus defended SmartMedia, and the radically different picture they painted of SmartMedia's prospects for the future. Most interesting was the extent to which they claimed perceptions of SmartMedia's viability and market position have been influenced in this country by SanDisk's hyper-aggressive PR campaign. (SanDisk is a large (the largest?) manufacturer of CompactFlash memory cards, and holds key design patents on the format.) In the US, the perception is that SmartMedia has a small and diminishing percentage of the memory-card market, a "fact" supported by market projections published by at least one major market-research firm. Olympus' own numbers are quite at odds with this though, placing worldwide market share for SmartMedia at something much closer to 50% (!). (They admit that the US market favors CompactFlash, but claim that the opposite is true in the rest of the world.)
As to SmartMedia's future, they had several comments. First and foremost, they view SmartMedia as a much more "consumer-friendly" package, with no fine connector pins to misalign. (A point we'll support, as we regularly fight with the external CompactFlash reader on our PC, the manufacturer of which shall go nameless here.) As to the capacity difference between SmartMedia and CompactFlash, they contend that this will cease to be an issue at the consumer level within the next 6-12 months: 32 meg cards are now readily available in the market, and 64-meg should be out by the end of this year. Even with 2+ megapixel cameras, few consumers will need more than this amount of storage, and 128 megabyte SmartMedia cards will be out sometime next year. Thus, their feeling is that any capacity shortfall is purely a short-term issue, and the advantages of the package far outweigh any capacity limitations.
We also asked about read/write speed of the respective formats, as the general perception seems to be that CompactFlash is quite a bit faster. In answer to this, they pointed to their USB card reader, which they claim can move data into the host computer at 1 megabyte/second. (This sounds very fast for USB (hard to believe): We'll be getting an eval unit of this reader very soon, and will report on what we find for data-transfer rates with it.)
The last issue we asked relative to SmartMedia was that of upward compatibility: Although Olympus has done an admirable job of providing upgrade paths for owners of their earlier cameras to move to 16- and 32-megabyte compatibility, the very fact that there were so many upward-compatibility problems with the format in the first place cast doubts on the utility of future capacity increases. Olympus' comment on this was that any camera (apparently theirs or any other manufacturer's) that's 32-meg capable now will handle SmartMedia cards all the way up to 128 megabytes without any further modification.

We were very appreciative of Olympus' making their top executives available for an extended conversation like this. We look forward to continuing the dialog in the future, and promised to pass along comments and suggestions our readers might make for their products. (We'll pass along any comments readers may leave on the comment-server link below directly to Olympus' management.) Thanks, Olympus!

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Wow - Lots of comments - more text here than in the original article, worth reading.


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