Wednesday, May 2, 2007

Help Canon Win: Go Buy a Nikon!

Thanks to Mike Johnston at The Online Photographer for highlighting this post which basically says that Canon is winning the war against Nikon.

The article states that the upcoming Mark III from Canon is all the evidence the author, Lloyd Chambers, needs that Canon is taking his requirements as a professional photographer seriously. Surely that’s to the good since such an approach ought to flow benefits down to the broader consumer in the long run and make Canon more competitive and profitable in the future? Well, yes and no. Clearly, the answer is “yes” when you look at technologies like image stabilization, more capable sensors, auto-focus technology etc. However, for things like on-camera adjustment of focus calibration and 10 f.p.s. shooting speed then it’s not so clear that your average point-and-shoot user will be seeing those any time soon.

The real issues here are overall company size and resources, and competitiveness. Canon can afford to invest in loss-making efforts both in terms of camera technology and optics (a point Lloyd makes himself) in order to keep that coveted spot as the favoured supplier to photojournalists, sports shooters, wedding photographers and other professionals. They can do that because it’s their consumer activities that pay for it, an area where Nikon doesn’t have the reach or pull that Canon has. I mean, when was the last time you saw a Nikon photocopier, printer or, frankly, pocket P&S camera being whipped out at Disneyland? However, Canon isn’t making those investments just to please themselves: clearly, they do so in order to beat Nikon out of even niche markets, such as the truly professional space, in order to try and deny then breathing space.

Are the days of the specialist technology provider who leads-the-charge in any given market therefore over? Alas, I think the answer is “yes”, at least in the case where they hope to differentiate themselves solely by technical advancement. It’s ultimately a dead-end strategy. Whether it’s the car business or the camera business, the equation is the same: economies of scale + profits = market dominance. That's the only sustainable way to afford the luxury of high-end products and showcase brands that are almost always loss-leaders. Ford is broke, hence it sells Aston Martin (who ironically just turned a profit); Leica is still in business but really only because of the brand loyalty of its customer base (see this analysis of the digital M8) and not because they offer anything that's technically differentiated.

Ironically, therefore, the reality is that in order to keep the market vibrant and to continue to force the Canons of this world to aggressively push the envelope of technical excellence, the answer is clear: buy Nikon gear!

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