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Canon Q3 profits down 21%. Where to now?


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http://www.reuters.com/article/2014/10/27/canon-results-idUSL4N0SM25K20141027

"The consumer shift to smartphones for casual photo taking has pummelled demand for compact cameras, while the growing popularity of lighter mirrorless cameras has taken away market share from higher margin single-lens reflex cameras."

Hardly surprising; Canon hasn't done much to improve its DSLRs since the 5DMKII came out in 2007, & if it wasn't for the demand for feature improvements from filmmakers & videographers, Canon would've lost even more of its market share sooner.

We've had a lot of debates on the forums over the years about whether we were a niche market; I think the A7s, A7sII, and GH4 are evidence that we're not. It was pretty obvious back in 2007 that the video DSLR market would take off. Canon put all of its eggs in the 'professional' market with the C series cameras and totally dropped the ball with the DSLR market. If it wasn't for Magic Lantern I couldn't see any reason why anyone would want to use a Canon DSLR now when Sony, Panasonic and Nikon are making cameras with much better video specs. Canon are way behind in the dynamic range & IQ stakes (leaving the pricey 1DC out of the equation).

So what can Canon do to compete? It's staring them right in the face: Magic Lantern. It's like Canon's forgotten what happened when they brought out the 5D 24p update. It's pretty basic business theory really: if you wanna be successful you have to stay ahead of the curve; Canon could do raw video tomorrow. This idea that people don't want raw is ridiculous, it's like saying people don't want raw stills. My 5DMKIII with Magic Lantern destroys my A7s in every test I've put them through, but no hack is 100% stable 100% of the time. Mine's been pretty solid but I still carry the A7s just in case the 5D dies on me.

Canon are now looking at sourcing sensors from other manufacturers http://www.canonrumors.com/canon-actively-testing-third-party-sensors-cr2/, a smart move considering how far ahead Sony is in sensor development. If Blackmagic can source 15 stop sensors (13.5 with global shutter) Canon surely could too. If Canon can't make a good enough EVF they should source one of those too & ditch the optical viewfinder; I much prefer the A7s to the 5DMKIII for stills shooting because of the EVF.

If the next 5D has another optical viewfinder and records a 4k compressed codec Canon won't regain any market share. The 2 biggest issues with DSLRs are the 8bit compressed codecs and the rolling shutter, and they're the 2 things Canon should be focusing on. 2k raw is a lot more production worthy than 4k 8bit compressed, why not have both as an option? We know from Magic Lantern that raw 2k recording works on now outdated tech, 4k is doable in camera too with faster media.

Will Canon get smart? probably not, historically Canon have been knuckledraggers, but if another company or hacker enables raw video on a more advanced DSLR Canon are screwed. I reckon we will see a new DSLR record raw video within 12 months, Nikonhacker are close, and the A7sII looks very hack worthy. In the meantime I'm eyeing the Blackmagic Micro Cinema Camera and the Ursa Mini 4.6k.

End rant.

Filmed on a 5DMKIII  (Magic Lantern H.264 pre-raw)

 

 

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Imo Canon is currently the smartest camera maker. Where I live a used 5dmkiii still costs more than a brand new d750. A used a7s costs not even half. So why develop and put out new cameras.

Why upgrade the rebel line when it still sells. Why put advanced features in a DSLR when you can sell it for 3 times as much in a C-line.

Their profit is falling. But its from proffit. The othets lost money and are now loosing more. 

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http://www.eoshd.com/2014/09/market-dslrs-shrinking-dramatically-canon-nikon-blame/

Those figures came out before the 2nd generation A7 cameras were released. I know a lot of people who've ditched their Canons for a Sony. I reckon Sony's well on track to closing the mirrorless vs mirror box gap in 2016. Canon tech is old and tired; Sony raised the prices on the 2nd gen A7 range because they know everybody wants one, and there's a really tasty selection of e-mount lenses on (and coming to) the market. Canon could pay dearly for its hubris. If I was shooting stills professionally I'd drop the 5D for an A7rII, and if Magic Lantern didn't exist I'd shoot video on an A7sII. Who's going to spend over $10,000 on a 1DcMKII if it doesn't do raw video?

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Where I live a used 5dmkiii still costs more than a brand new d750. A used a7s costs not even half.

I would say that this is down to public company image, which takes a long time to change. Probably until you reach a tipping point where a large enough percentage of users want to jump ship and the market is flooded with used bodies. Right now, the shift is happening at a slow pace, but it is happening.

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Quarterlies mean next to nothing unless you know every move Canon is making.

A company like this could spend $x million to build a new sensor factory and write off profits for that quarterly, safe in the knowledge that that factory will show profits down the line.

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The market is basically flooding with used a7s cameras. And no one is buying.

It is time to upgrade. Looks like they all made enough money with their a7s that they can afford the mark II. The same will happen when Canon releases 5DIV. And where I am from, used a7s are being bought, since they are still incredible tools.

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I think Canon is acting pretentious, it reminds me a lot of Nokia.

 

In the early 2000's/late 90's it was unthinkable buying a phone that wasnt Nokia, every other phone was "crap", so they kept doing the same thing, phones barely upgraded between generations and in a  very short period of time, Iphones came and smartphones....and no Nokia has 1-3% market share.

Canon is getting left behind, and when they decide "its time to move" it may be too late, because you need time for try and error, and they will loose so much ground (I suspect by this time, next year, they will have lost probably 50%). The rebel line is good enough for beginners/enthusiasts, but even that market is getting shadowed by the uprising of Iphones and other samsungs.

IMO they deserve everything that its coming, they spend most of their time crippling their own equipment so that they can protect their overpriced cinema line.

*I upgraded to the NX1 about 2 months ago, and even though im still getting used to it, I dont consider going back to a dslr. Might get an a7 or a7s if the price is right (around 500-700€ thats what im willing to spend).

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After having the luxury of EVF for manualy focusing video/stills i would find it very hard to go back to dslrs. But who knows, maybe canon will release something interesting.

The evf isnt the end of the world since my xc10 and Alphatron has spoiled me and now regular EVFs are just to small.

I do miss peaking sometimes, but belive that will be standard in the next generation.

Other than that I really dig my d750.

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Canon is selling tons of overpriced glass and outdated sensors, every single manufacturer would love to be in canons shoes. They even have thousand of users on internet forums that are convinced that a magenta cast coming from channel scaling is something positive.

A professional canon setup costs the same or more than a professional medium format setup, and it only performs better in sports, for the rest the performance is an order of magnitude worse, but still canon is a lot more successful.

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http://www.reuters.com/article/2014/10/27/canon-results-idUSL4N0SM25K20141027

"The consumer shift to smartphones for casual photo taking has pummelled demand for compact cameras, while the growing popularity of lighter mirrorless cameras has taken away market share from higher margin single-lens reflex cameras."

That article paints an incomplete picture, overall Canon's sales are up 6%. Imaging sales decreased by 4.2% and profit decreased by 3.8% over Q3 2014. Canon is diverse and all of its divisions are showing a profit. They're sitting on a lot of cash and making investments.

Fuji, Panasonic and Olympus struggle to make any profit selling digital cameras, Nikon looks like it could really get slammed in the coming years too. Its bleak times for everyone, but they're still firmly in the black.

http://www.canon.com/ir/conference/pdf/conf2015q3e.pdf

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Regardless on how more successful they are in development (or are not) than other manufacturers, I tend to think a 21% number would be somewhat unsettling to the people in Canon's board rooms. 

They might be the very people that are completely unfazed. Like I said, quarterlies are as good as meaningless to anyone outside the company. Only those inside will know if those profit decreases are from a large overhead (building a new factory, for instance)... Or something more concerning.

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I do alot of sport, news coverage and there are always hundreds of photographers...I don`t think I saw 5 of them over the summer using anything else that canon/nikon. 99% of the pro market belongs to them and consumers buy what they see pros are using. I would say that canon is doing fine.

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The evf isnt the end of the world since my xc10 and Alphatron has spoiled me and now regular EVFs are just to small.

I do miss peaking sometimes, but belive that will be standard in the next generation.

Other than that I really dig my d750.

You cant get peaking with an OVF.

DSLRs are substandard tools if you use manual focus frequently and demand critical focus. On the NX1 DMF is a game changer when it comes to critical focus. I can't imagine ever going back to a DSLR because of that. That particular tool is incredibly useful for the sorts of photography I do.

Yes, there are some people dropping their Canon bodies for Sonys, but lots of them are still shooting with Canon glass. You think Canon doesn't make any profit there?

Its the new generation that don't own legacy glass and are not conditioned into product loyalty that they should be concerned about. Those folk have no incentive to stick with Canon in the face of more advanced competitors. Grandpa may always buy Canon because that's what he has always done, but the young turks have no such baggage.

What Canon does (or does not) do today will have repercussions for them for decades to come, so it is not an insignificant thing.

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