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07-24-2020, 06:37 PM - 2 Likes   #16
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QuoteOriginally posted by Fontan Quote
That is a scary thought for the entire industry, let alone for the small players. Did Olympus also take similar measures, I wonder? It is really.a cut throat industry right now with such a huge downturn. When the business is close to 10% of what it was 10 years ago - just 10 years ago! - how feasible is it for the small players to "survive" while turning meaningful amount of profit? I wonder what Ricoh gets out of by keeping Pentax alive in such an environment. I do think that it is not so much the savviness of Pentax but do they really have any other choices? The industry in itself is running of "niches," it seems like.
Well, small players are niche, so they don't enjoy the heights of the big players in booms, and they don't have the sizes of their overheads and losses in busts.

It's like the little mammals outliving the dinosaurs after the asteroid hit, right?

Olympus as you know pretended there was no crisis, even after being bailed out by Sony in 2013. They produced lots of shiny new products for DPR to review, and spent big on marketing in a way that Ricoh would never allow.

Why, I watched a 'Why I'm leaving Canon for Olympus' Youtube video just last week. Bet that pro's kicking himself now!

07-24-2020, 07:06 PM   #17
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QuoteOriginally posted by clackers Quote
The idea is not to sell cameras - Olympus sold twice as many as Ricoh last year on their way to losing $150 million - but to generate a profit.

The activist board members at Sony may kick into action as well.
Anything can happen with Sony or any other company. Sony is heavily invested in media and like Panasonic, Sony wants to be in all aspects of it. They want to make the TVs that games are played on and movies are watched on.... They want to make the games.... They want to make the movies.... They want to make the cameras that record the content and the consoles that run the games..... They want to make the sensor that capture the images.... They want to make the memory that stores the images. Panasonic said in an interview one time that they need to make 4K affordable to people will make 4K content. If there is no 4K content then they can't sell 4K TVs to anyone. I don't see Sony or Panasonic going anywhere. The cameras and the technology that they develop for them fit into their bigger picture. I expect the next big casualty is Nikon. They have no where near the diversity of Sony or Panasonic and over the last few years Nikon has made nothing but bad financial news even compared to the rest of the industry. The hybrid market is where the opportunities are to be found, and Nikon is not well positioned relative to Canon, Sony, & Panasonic. Olympus was too late to embrace video relative to Panasonic on the M4/3 platform and sensor prices fell to the point that sensor size was no longer the major cost in camera development. Olympus never recovered from the money laundering scandal. I always thought Olympus made great equipment they just failed to make the move to FF when the writing was on the wall. I would guess they knew that they didn't have the resources that they would need to make the move. Olympus filed patents on 3-4 FF mirrorless lenses and it possible that they join a FF mount just as a lens manufacture..... But that's just wishful thinking. Olympus makes great glass and they could be a great 3rd party or OEM manufacture when/if they restructure under JIP.


But yes, activist board members could breakup any company in the industry right now. Canon, Nikon, Sony, Panasonic, Ricoh..... I guess Sigma and Leica are both safe since they are private companies.
07-24-2020, 09:00 PM - 1 Like   #18
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QuoteOriginally posted by clackers Quote
Well, small players are niche, so they don't enjoy the heights of the big players in booms, and they don't have the sizes of their overheads and losses in busts.

It's like the little mammals outliving the dinosaurs after the asteroid hit, right?

Olympus as you know pretended there was no crisis, even after being bailed out by Sony in 2013. They produced lots of shiny new products for DPR to review, and spent big on marketing in a way that Ricoh would never allow.

Why, I watched a 'Why I'm leaving Canon for Olympus' Youtube video just last week. Bet that pro's kicking himself now!
Itís just doesnít feel like Pentax is ďcarving outĒ their niche. Itís more like being cornered while big players are canibalizing one another. I just wonder how this is sustainable for all players involved, big and small. Variable costs of competing in this sector can be adjusted to a great degree, but the fixed cost of innovation in this industry I bet is huge, in that you skimp out on that aspect you get left behind so fast. Product cycles, the speed of it is just stupendously fast. Thatís the part that worries me. The onslaught of assault is coming from outside (cell phone cameras) but they seem like they are trying to destroy each other within. I wonder if the survival of the entire sector hinges on sharing info and resources rather than beating the next guy within the block.
07-24-2020, 09:03 PM   #19
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QuoteOriginally posted by Winder Quote
Anything can happen with Sony or any other company.
Oh, haven't you heard?

What I'm talking about is not some general 'in this dying camera business, all companies could do anything'.

No, it is Sony specific through Daniel Loeb, who knows he can't get twenty percent returns through the camera division of Sony:

Sony Camera Division becomes part of a separate company - Newsshooter

"Loeb has been adamant that Sony should be taking money away from its camera business and moving it into the entertainment division."

07-24-2020, 10:19 PM - 3 Likes   #20
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QuoteOriginally posted by clackers Quote
Oh, haven't you heard?

What I'm talking about is not some general 'in this dying camera business, all companies could do anything'.

No, it is Sony specific through Daniel Loeb, who knows he can't get twenty percent returns through the camera division of Sony:

Sony Camera Division becomes part of a separate company - Newsshooter

"Loeb has been adamant that Sony should be taking money away from its camera business and moving it into the entertainment division."
No one gets 20% Return on Invested Capital in cameras and lenses. In good years ROIC is 8%.The entire industry is built on a high volume / low margin business model that requires constsnt consumption. But durable goods aren’t consumables. That kind of 20% return is limited to pharmaceuticals, some technology, content owners, and Medical Equipment.

Oddly, Ricoh Imaging might just be OK because 1) Ricoh have so little capital invested and 2) Imaging is apparently at least not losing money.

I’m quite concerned about Nikon. At one time the had 80% of the semiconductor photolithography stepper market and that division was 35% of their revenue. Now they have 10% of the market (ASML kicked their butts) and lose buckets of money. It smells like AOCo. when the SMC patent royalties ran out and suddenly their string of bad decisions going back to delaying the bayonet mount was revealed. Emperor has no clothes kinda thing.

Nikon likely own a massive patent catalog and plenty of real estate - just the stuff distressed investment funds love to acquire on the cheap. OTOH Nikon is a voting member of Mitsubishi Group keiretsu (cross ownership each of the other) and likely has very deep parental pockets. Canon is part of the Fuyo keiretsu which is much smaller than Mitsubishi, so Canon maybe has shallow parental pockets than Nikon.

Last edited by monochrome; 07-24-2020 at 10:31 PM.
07-25-2020, 03:35 AM - 2 Likes   #21
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QuoteOriginally posted by Fontan Quote
Itís just doesnít feel like Pentax is ďcarving outĒ their niche. Itís more like being cornered while big players are canibalizing one another.
I think there's a lot of truth to that, Fontan. So you can see why there was that PetaPixel opinion piece that thought Ricoh was doing exactly the right thing.

The FF market is all the *other* manufacturers seem to care about these days. m43 dead, Sony all but abandoning APS-C except for flagships, and if Pentax were to attempt a FF mirrorless right now, in 2020, it would be entering this wrestling ring you're talking about: Canon, Leica, Sony, Nikon, Panasonic and Sigma, the last two very recent. They are absolutely cannibabilizing each other, meaning there is a price war going on that hurts all concerned.

And what does Pentax do in the middle of this gunfight? It sits out and offers an APS-C DSLR on their tried and tested later this year, just as Canon and Nikon look to be orphaning their DSLR camera and lens development.

A lot of spreadsheets would have been crunched the numbers of different models and scenarios for the market, and this was the one the Ricoh Imaging president had the backing of the board for. Quite bold when all the herd mindshare is for MILCs. It also says that Pentax is not gambling on purchases by the herd. It knows the herd are using their phones. Cameras of the future will be for a tiny number of professionals and a somewhat larger number of photography loving enthusiast amateurs.
07-25-2020, 03:39 AM - 2 Likes   #22
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Hmm... you're not cornered if the fight happens somewhere else...
"A strange game. The only winning move is not to play.". We'll see how it goes, but if the MILC makers continue to try killing each other...
07-25-2020, 03:46 AM - 1 Like   #23
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QuoteOriginally posted by monochrome Quote
No one gets 20% Return on Invested Capital in cameras and lenses. In good years ROIC is 8%.The entire industry is built on a high volume / low margin business model that requires constsnt consumption. But durable goods aren’t consumables. That kind of 20% return is limited to pharmaceuticals, some technology, content owners, and Medical Equipment.
Yes, definitely not cameras. Loeb wants Sony to get out of them. He was successful in getting Sony to exit its investment in Olympus last year, recently he was successful in getting cameras moved into a different holding company with consumer electronics. That gives him options about what to do with the problem!

QuoteOriginally posted by monochrome Quote
Oddly, Ricoh Imaging might just be OK because 1) Ricoh have so little capital invested and 2) Imaging is apparently at least not losing money.
Yes, because they're small, they get a pass mark, that's a win.

Nikon's imaging division has posted enormous losses over the last year, going mirrorless a disaster for them, and yet, the Nikon corporate plan will be built around achieving greater than 8% ROE, how will they do that if they still make cameras?

Nikon's FY2020 financial results: •225.8B in revenue, •17.1B operating loss for Imaging Products Business: Digital Photography Review

QuoteOriginally posted by monochrome Quote
I’m quite concerned about Nikon. At one time the had 80% of the semiconductor photolithography stepper market and that division was 35% of their revenue. Now they have 10% of the market (ASML kicked their butts) and lose buckets of money. It smells like AOCo. when the SMC patent royalties ran out and suddenly their string of bad decisions going back to delaying the bayonet mount was revealed. Emperor has no clothes kinda thing.

Nikon likely own a massive patent catalog and plenty of real estate - just the stuff distressed investment funds love to acquire on the cheap. OTOH Nikon is a voting member of Mitsubishi Group keiretsu (cross ownership each of the other) and likely has very deep parental pockets. Canon is part of the Fuyo keiretsu which is much smaller than Mitsubishi, so Canon maybe has shallow parental pockets than Nikon.
Yep, but being in the keiretsu system seems to be overrated and carries less weight these days. It looks like real progress in the Japanese economy can't occur as long as successful companies in a group have parasitic failing ones hanging off them.

Olympus was part of the Sumitomo keiretsu AFAIK, and they got sick and tired of them. No more handouts!

07-25-2020, 03:47 AM - 2 Likes   #24
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QuoteOriginally posted by Fontan Quote
Itís just doesnít feel like Pentax is ďcarving outĒ their niche. Itís more like being cornered while big players are canibalizing one another. I just wonder how this is sustainable for all players involved, big and small. Variable costs of competing in this sector can be adjusted to a great degree, but the fixed cost of innovation in this industry I bet is huge, in that you skimp out on that aspect you get left behind so fast. Product cycles, the speed of it is just stupendously fast. Thatís the part that worries me. The onslaught of assault is coming from outside (cell phone cameras) but they seem like they are trying to destroy each other within. I wonder if the survival of the entire sector hinges on sharing info and resources rather than beating the next guy within the block.
I don't know. I think Pentax is saying, "This is who we are" pretty clearly. If your interest is in things MILC or high end video, you probably should look elsewhere. We'll see what the K-new and DFA 21 limited and DA *16-50 PLM look like, but I think they have decided on a path to take and it will please the Pentaxians who have stuck with them so far and it probably will attract a few folks from other brands who really haven't bought in to the whole mirrorless revolution thing. Beyond which, Ricoh has the GR and Theta series of cameras, which, while not K mount gear, have generated revenue that is used by the whole imaging side of things.

The problem actually is going to be for the bigger players in the market. If your company is designed to manufacture millions of cameras and lenses and the market dries up the way it has, you hurt a lot more than if you are lean and designed to produce several thousand bodies/lenses a year.

---------- Post added 07-25-20 at 06:49 AM ----------

QuoteOriginally posted by clackers Quote
The idea is not to sell cameras - Olympus sold twice as many as Ricoh last year on their way to losing $150 million - but to generate a profit.

The activist board members at Sony may kick into action as well.
It reminds a bit of the car companies back in the day -- build huge numbers of cars and if you can't sell them all, sell them to the rental companies that you own stakes in for them to run for a year or two and then sell them used. At some point you need to sell less gear for a profit...
07-25-2020, 04:13 AM   #25
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QuoteOriginally posted by Rondec Quote
It reminds a bit of the car companies back in the day -- build huge numbers of cars and if you can't sell them all, sell them to the rental companies that you own stakes in for them to run for a year or two and then sell them used. At some point you need to sell less gear for a profit...
Yeah, gets messy, doesn't it?
07-25-2020, 06:11 AM - 1 Like   #26
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QuoteOriginally posted by clackers Quote
Oh, haven't you heard?

What I'm talking about is not some general 'in this dying camera business, all companies could do anything'.

No, it is Sony specific through Daniel Loeb, who knows he can't get twenty percent returns through the camera division of Sony:

Sony Camera Division becomes part of a separate company - Newsshooter

"Loeb has been adamant that Sony should be taking money away from its camera business and moving it into the entertainment division."
I do remember Daniel Loeb. I also remember when he sold his stake in Sony back in 2014. Activist investor Dan Loeb sells stake in Sony Corp. - Los Angeles Times


While anything can happen. One thing I don't expect to see in the near future is Japanese companies letting American investors have any real say in operations.


Sony could very well split into 100 smaller companies tomorrow. Why does that matter?

---------- Post added 07-25-20 at 08:54 AM ----------

QuoteOriginally posted by Fontan Quote
Itís just doesnít feel like Pentax is ďcarving outĒ their niche. Itís more like being cornered while big players are canibalizing one another. I just wonder how this is sustainable for all players involved, big and small. Variable costs of competing in this sector can be adjusted to a great degree, but the fixed cost of innovation in this industry I bet is huge, in that you skimp out on that aspect you get left behind so fast. Product cycles, the speed of it is just stupendously fast. Thatís the part that worries me. The onslaught of assault is coming from outside (cell phone cameras) but they seem like they are trying to destroy each other within. I wonder if the survival of the entire sector hinges on sharing info and resources rather than beating the next guy within the block.
Are they trying to destroy each other? Sony sells sensors to most of its competitors. The EVF used by most mirrorless cameras is made by Sony. Sony wants Fuji to be successful since Fuji buys a several key components from Sony. Sony watched what Fuji was doing and adopted some of the thing that Fuji was doing like adding the aperture ring back to their lenses. Sony bought into Olympus in effort to keep Olympus in business a few years ago.


There is a difference between competing to be #1 and trying to destroy each other. The new Canon R-5 looks like a legitimate contender to be the best general purpose mirrorless camera on the market.... and that is a good thing. Sony has been sitting on their butts for the past 4-5 years. Now we will finally see the A7sIII after 6 years and Sony will update the 4 year old Sony A9 AF system. The only way Sony gets to be successful is improving their products and offering customers better products. If Sony chooses not to improve, then they will fail. Doesn't matter to me. I can press the shutter button on a Canon or a Fuji just as easily as I can on a Sony camera.
07-25-2020, 08:09 AM - 2 Likes   #27
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QuoteOriginally posted by Kunzite Quote
Hmm... you're not cornered if the fight happens somewhere else...
"A strange game. The only winning move is not to play.". We'll see how it goes, but if the MILC makers continue to try killing each other...
It's like the game Go. You have to know where to put the stones and ricoh seems to know.
07-25-2020, 12:22 PM   #28
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QuoteOriginally posted by Winder Quote
Are they trying to destroy each other?
I am no insider, let alone an expert, but my guess is yes. It makes sense to knock off as many competitors in this market, simply because of the mark up. I am reading that the mark up for the digital cameras are around or even below 10% at street pricing. Obviously newbies on the market can command pricing nearing MSRP, but give it 6 months the margin becomes much smaller. It is an industry that requires lots of R and Ds, as the product cycles are so damn short, and unless you got new technologies incorporated into the products you get left behind. This is great for consumers, but as an industry model it is to me not sustainable and very vulnerable. I imagine Sony and. Canon, who produces own sensors, are smelling blood as Nikon falters. I would be very worried if I were Nikon users. Their business model is not as diversified as others. With less competitions you can name your margin, and there is no demand for light speed R and D.

I am hoping that Pentax / Ricoh are able to ride this out and survive because of two reasons. One is the lenses that Pentax has produced and has been putting out of late. I just love their lenses. I think they can do head to head with Leica on this front. Second reason is that I love GR. For me, GR is the best camera on the market, all things considered. Camera bodies are dime a dozen. They all produce great results once mastered, and I get so much out of set up that are getting outdated. Even things like GXR for me produces amazing results, despite is quirtkiness and short comings. In fact, I will be totally fine if Pentax became an exclusive lens manufacture of various mounts (yes please chew my nuts off please, folks). I love bright OVF, but not a must. I can definitely work with EVF. I just don't care about the body that much.

---------- Post added 07-26-20 at 04:23 AM ----------

QuoteOriginally posted by yucafrita Quote
It's like the game Go. You have to know where to put the stones and ricoh seems to know.
Towards the end of the game in Go, you begin to run out of spaces, and therefore options to maneuver though.
07-25-2020, 01:00 PM   #29
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QuoteOriginally posted by Fontan Quote
I imagine Sony and. Canon, who produces own sensors, are smelling blood as Nikon falters.
Maybe Canon, not $ony because they supply Nikons sensors.

QuoteOriginally posted by Fontan Quote
please chew my nuts off please,
Not sure many will take up that offer!
07-25-2020, 11:38 PM   #30
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QuoteOriginally posted by Fontan Quote
Towards the end of the game in Go, you begin to run out of spaces, and therefore options to maneuver though.
Yes, but I think Ricoh is playing wise and clever, so for the endgame, they may have an advantage.


Go strategy and tactics - Wikipedia

I wonder if Ricoh indeed is applying Go philosophy in their approach.
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