[Aristophanes]

The new presentation of the document in which Pentax camera division does not appear anymore as a business unit but is merged into a larger "information system division" shows us that there is no plan to sell Pentax in a near future anymore. To sell a division you should make it a business unit so that the buyer has a clear idea of the health and revenues of what he buys. The change of presentation of the document reflects this change is strategy.

+10. Absolutely. Good call.

[mattdm]

I think that maybe Samsung will buy Pentax. They are the biggest consumer electronics maker in the world so the Pentax expertise and brand could give the necessary weight to their camera business. Remains to be seen if they want to develop Pentax into the pro-segment but I think that with the Samsung money and global network that would be possible and Pentax would compete again with the Canikons.

We've gone through this before, and there's two reasons it probably won't happen. First, Pentax is an old Japanese company, and Samsung is Korean. Cooperation is one thing, outright purchase is another. Second, Samsung's strategy with the NX shows that they don't care for Pentax that much after all.

[uccemebug]

Hey Uccemebug,

I don't believe Hoya went to Citi, but somebody did (probably the company involved in negotiations to purchase the Pentax Digital Imaging Division, that is one of my reasons for suspecting Kodak. Kodak and Citi are both stateside. Kodak is a shrewd company with its business proceedings, not so much on execution and follow through. What I have seen of Kodak is that it survives a lot on litgation and intellectual properties.

Ah, what passes today for the "American way". 8^)

I see your point and agree with you on Hitachi. Hitachi is the parent company of Epson. Epson did release a Leica M clone, the R-(something) that was really awesome but I believe it was only sold in Japan. It's a shame, it was a great camera. I thought about purchasing one a few years ago but passed on it. Hitachi does manufacture imaging sensors also. The Hitachi-Epson group would be a much better fit than Kodak.

I wasn't aware that Hitachi makes sensors. It seems a better and better fit. 8)

But does Hitachi own Epson? I hadn't heard that and couldn't find quick verification. According to this, the Epson Group is not owned by another corporation directly.

Seiko Epson - Wikipedia, the free encyclopedia

Epson also makes good stuff. I'm very happy with my Epson scanner (it has slide scanning ability and can do 6x4.5 negs) and I was really impressed with the Epson viewfinder LCD's at a camera show I attended in Yokohama in the winter. Really impressed.

I find Kodak very disappointing. In 2009 Kodak closed its CMOS sensor division to focus soley on CCD sensors.

Image Sensors World: Layoffs, Layoffs

Kodak had only acquired that division in 2004 or 2006 if I remember correctly.

...

Getting back to Kodak, they are a very badly managed company. 110 film was garbage, Disc Film was garbage, APS-C Advantix = more garbage, plus it was Kodak that was pushing the original 4/3 format. The whole 4/3 format to me is a huge joke and a big waste of money. The only companies that fell for 4/3 were Panasonic and Olympus. Both of whom are rumored to be working on larger format cameras. When Kodak first announced the 4/3 format it trumpeted that a large number of companies were going to join the 4/3 group. No one really did. Kodak wasn't even ready at the retail level with the photo kiosks to print pictures from the 4/3 cameras!

Pathetic. It'd be funny if it didn't involve so many people losing their jobs.

Regardless, I don't want to see Pentax become a victim of Kodak's incompetence. The Hitachi/Epson group would be a much better fit. Even Fuji! Fuji is somewhat aligned with Nikon though.

Fuji seems to be preoccupied with things like skin care products these days. It could be that they see themselves as a chemistry/materials company and are swerving away from imaging altogether.

Time will tell, Photokina is next month! I wish Pentax the best and truly believe Hoya would be best served by holding onto Pentax. R&D from the camera group can be shared with the medical group, etc. Selling the Pentax camera group is too short sighted. Rome wasn't built in a day. Pentax was badly managed for a number of years. Hoya has the management skill and resources to breath new life into Pentax and make it successful again.

Agreed. Hoya might do well to hang onto Pentax just to see what's going to happen when this current round of evolution in the market settles a bit. As I pointed out in one of these threads, integration with the mobile platforms that are merging phones with computers could be a fantastic way of creating a higher-margin, highly popular segment that doesn't today exist. Whether they pursue that or not, Hoya is an innovative and energetic operator for Pentax and I think that by continuing with their habit of making great niche products that sell they'll do well. They may even find that they've got a very competitive and profitable unit on their hands if they position themselves well.

[bertbert]

Get a grip people. Hoya won't sell Pentax.

[falconeye]

Ok, my analysis goes here:

1. Hoya uses to be world market leader in the markets they are active in.
2. Digital cameras and magnetic media (the finished disks which go into hard drives) are exceptions to this rule.
3. Earlier this year, they sold the magnetic media business to Western Digital (a 235 M$ deal) but kept the hard drive glass substrate business where Hoya continues to be world market leader.
4. In 2007, Hoya aquired Pentax (a 864 M$ deal), certainly in an attempt to strengthen their (now called) "Life care" business.
5. This deal was decided in 2006, months after Sony purchased assets from Konica-Minolta (undisclosed deal).
6. To dissolve Pentax within the Hoya business plan is mandatory as otherwise, "Life care" and "Information technology" couldn't be aggregated which both contain parts of Pentax. Nothing can be deducted from that action. Potential buyers are certainly presented with the results of an "Imaging" sector within Information technology.
7. To aquire Pentax and resell their Imaging business certainly was the plan when Hoya aquired Pentax. To be #5 in digital cameras certainly isn't something Hoya can feel comfortable with.
8. Hoya must think of asking for at least 500 M$ before accepting to sell Pentax Imaging. However, this is difficult if not impossible to achieve, esp. if Sony payd less for KM assets (which I guess is the case -- KM ceased their business selling off assets...).
9. Acc. to http://www.hoya.co.jp/english/investor/fs20100803_2e.pdf (a very good source btw) "Information technology" is much more profitable and dynamic than "Life care". The turnover is 50/50 roughly.
10. In the business year ending March 2010, Pentax had a turnover of 1230 M$ (1.4x the purchase price).
11. Pentax is profitable now (+5%). But in the business year 2009, 4th quarter it was deep in the red. This was Jan.-Mar 2009 (just as the first Mr.Blurrycam K-7 rumors emerged). And the deficit was -35.7% (-91.3 M$). So, Pentax made Hoya loose almost 100 M$ in just one quarter, 1 million $ loss a day ... In comparison, the current profit is 15.3 M$ or $170,000.- a day. So, Hoya needs 2 good years to recover from that 2009Q4 disaster. At the current profit, 1 billion $ asking price (for the whole of former Pentax) would be 16 years' profit. Not easy to achieve for "old" business like SLRs and lenses.
12. The best strategy to increase the value of Pentax Imaging would be to be strong in an emerging sector of it. Logically, Hoya obviously already explained to investors that they will have a genuine SLD (EVIL) offer.

So, what to conclude from all of this? Well, I guess that Hoya now accepts that it will be a medium term operation to increase the value of Pentax to a desired level. So, they now invest into the brand. SLD, 645D, maybe, they will even give green light for full frame soon? In the SLD segment, they compete against Sony, Panasonic, Samsung. So, this is a risky game and I guess they don't bet everything onto this. They have to remain strong in their home territory. 2009Q4 must have told them that putting a new sensor into an existing camera (K20D) is not enough for 2 years of development

As to who is candidate to aquire Pentax in a couple of years? Sony is the natural candidate. But only if Pentax manages to bite into their market share. It will be interesting to see how different Pentax' SLD-mount will be from Sony's E-mount

[NaClH2O]

- who else has the necessary expertise in manufacturing multi-colored products?

I tell you it's a conspiracy! That "My Lego Man 365 day..." thread over in the mini challenges forum is nothing more than a cleverly disguised marketing tool! Corporate shennanigans for sure!

NaCl(spies I tell ya, spies!)H2O

[Aristophanes]

Get a grip people. Hoya won't sell Pentax.

Correction. Hoya likely cannot sell Pentax. You need a buyer. This is a credit-strangled market with buyers scarce to non-existent.

[Kunzite]

IMO Sony could only buy Pentax in order to kill them (they don't need to compete with themselves, i.e. promoting a competing system in addition to their owns). Would they pay a lot of money only for that? I very much doubt it.

[uccemebug]

Ok, my analysis goes here:

1. In the business year ending March 2010, Pentax had a turnover of 1230 M$ (1.4x the purchase price).
2. Pentax is profitable now (+5%). But in the business year 2009, 4th quarter it was deep in the red. This was Jan.-Mar 2009 (just as the first Mr.Blurrycam K-7 rumors emerged). And the deficit was -35.7% (-91.3 M$). So, Pentax made Hoya loose almost 100 M$ in just one quarter, 1 million $ loss a day ... In comparison, the current profit is 15.3 M$ or $170,000.- a day. So, Hoya needs 2 good years to recover from that 2009Q4 disaster. At the current profit, 1 billion $ asking price (for the whole of former Pentax) would be 16 years' profit. Not easy to achieve for "old" business like SLRs and lenses.
3. The best strategy to increase the value of Pentax Imaging would be to be strong in an emerging sector of it. Logically, Hoya obviously already explained to investors that they will have a genuine SLD (EVIL) offer.

So, what to conclude from all of this? Well, I guess that Hoya now accepts that it will be a medium term operation to increase the value of Pentax to a desired level. So, they now invest into the brand.

Nice work, there! Your figures really help put it into perspective. I've heard that pricing a business should factor in five year's income. Hoya would seem from the point #10 above to have turned things around in a hell of a hurry. Even though this consumer product line wouldn't seem a natural fit for Hoya, your logic is very sound .. and backed up by Hoya's recent actions, too.

But perhaps there's another way for Hoya to achieve market leadership while making the most of their other optics lines and retaining some value from their investment in Pentax: ditch the camera business altogether and focus only on their well-regarded lenses. One thing that I don't see from Pentax's line-up that is obviously evident for Canon, Sony, and Panasonic is the sharing of technologies across product lines. All three have plenty of other consumer and business electronics products that can surely re-use (and loan) technologies, cutting down the relative cost of R&D.

[falconeye]

IMO Sony could only buy Pentax in order to kill them (they don't need to compete with themselves, i.e. promoting a competing system in addition to their owns)

Don't think so. Canikon would and so, their offers for Pentax would be small.

But Sony wants to grow to be at least same size as Canikon. They can buy the Pentax market if they manage to maintain product compatibility (K-mount, either native or via adapters) and if they incorporate the Pentax genes (great ergonomics, small, outdoor, primes etc.). And another source for great lenses would help too. Cameras like the K-x with an "old" Sony sensor outselling everything Sony has on offer must make them make shake their heads. Sure that joining forces with Pentax would make sensir for Sony. At least as long as they aren't doing better in the system camera segment.

One thing that I don't see from Pentax's line-up that is obviously evident for Canon, Sony, and Panasonic is the sharing of technologies across product lines.

Yes, Hoya surely has no long-term plan to stay in the consumer-electronics market. To keep the lens business is an option but then again, Pentax isn't market leader there either. And to sell camera assets rather than a brand is difficult. There actually could be a long-term perspective within Hoya if you consider Pentax to be world-market leader for extreme image quality cameras (aka medium format) which they soon may become.

And maybe, just maybe, Hoya managers keeps Pentax to spice up their boring lives. I mean, what greater opportunity to meet models do they have

[asw66]

I think that part of the value of the Pentax brand for Hoya is that it retains strong associations of high quality. Thus we're seeing Pentax eyeglasses and binoculars ... I expect that Pentax branding will feature increasingly across Hoya's products that are seeking a certain amount of cachet.

If I'm on the right track with this notion, we can conclude that Pentax's true value to Hoya is not easily discerned by reading the quarterly profit reports.

We might also conclude that Hoya will endeavour to keep the Pentax brand "upmarket". The release of the 645D might be said to exemplify this strategy: Pentax has released a product that outguns the top models from Canon and Nikon. If so, then we're unlikely to see Pentax compete for the absolute entry level of any market segment -- their products will instead be targeted at or near the top of each segment.

Hopefully, of course, if Pentax follow this strategy they will nonetheless do so while retaining their traditional emphasis on value.

[gazonk]

If so, then we're unlikely to see Pentax compete for the absolute entry level of any market segment -- their products will instead be targeted at or near the top of each segment.

I really hope they would take this advice for the P&S category. The W90 is a fine product building on their long experience with waterproof cameras, but e.g. with the i-10 I think they spoiled an opportunity to make a high quality P&S in a retro styling. Instead it's just purely fashion looks with really "me too" contents.

[Pål Jensen]

Sure that joining forces with Pentax would make sensir for Sony. At least as long as they aren't doing better in the system camera segment.

Why would it make more sense than buying Konica-Minolta?

[Aristophanes]

I think that part of the value of the Pentax brand for Hoya is that it retains strong associations of high quality. Thus we're seeing Pentax eyeglasses and binoculars ... I expect that Pentax branding will feature increasingly across Hoya's products that are seeking a certain amount of cachet.

If I'm on the right track with this notion, we can conclude that Pentax's true value to Hoya is not easily discerned by reading the quarterly profit reports.

Hoya is an unknown to consumers. As a retail brand, it is nothing. Pentax has all that value.

Hoya has little B2C experience. They are B2B manufacturer. Pentax as a retail, consumer electronics company is a stretch for them. Others do it, so it is entirely possible that they will continue to do both.

We might also conclude that Hoya will endeavour to keep the Pentax brand "upmarket". The release of the 645D might be said to exemplify this strategy: Pentax has released a product that outguns the top models from Canon and Nikon. If so, then we're unlikely to see Pentax compete for the absolute entry level of any market segment -- their products will instead be targeted at or near the top of each segment.

Hopefully, of course, if Pentax follow this strategy they will nonetheless do so while retaining their traditional emphasis on value.

Pentax is NOT upmarket. Maybe there is some trend here with the Limited lens series, but not the bodies. The 645D is at the lower end of the MF digitals, so int at realm Pentax is the low-end.

The K-x is a lower end camera. It punches above its weight in some respects, but not others. It competes on price and value, not features or brand cachet. Pretty colours help.

I do not see Pentax as being near the top. I see them as a "me too, but better value" company. Bodies are a value. Lenses...slipping.

I see Hoya having little choice but to hang on to Pentax as a retail brand. It adds some public presence to the company that was missing previously (the Intel Inside effect). It can add revenue in a smaller market share segment. The whole "top 1 or 2" thing is nonsense and has been for a decade now in consumer electronics, what with Apple and South Korean companies added to the mix in a variety of sectors. No one is really dominant anywhere, and Panasonic is chipping away at Canikon.

[GLXLR]

Hoya is an unknown to consumers. As a retail brand, it is nothing. Pentax has all that value.

Hoya has little B2C experience. They are B2B manufacturer. Pentax as a retail, consumer electronics company is a stretch for them. Others do it, so it is entirely possible that they will continue to do both.

I see Hoya having little choice but to hang on to Pentax as a retail brand. It adds some public presence to the company that was missing previously (the Intel Inside effect). It can add revenue in a smaller market share segment. The whole "top 1 or 2" thing is nonsense and has been for a decade now in consumer electronics, what with Apple and South Korean companies added to the mix in a variety of sectors. No one is really dominant anywhere, and Panasonic is chipping away at Canikon.

Hey Aristophanes. Although I'm not experienced in economics as some of the users here are, I would like to point out that Hoya's products are mainly used by consumers indirectly, much like steel: no one goes out to buy steel these days, only big companies use the steel and turn it into something else like Carnegie (US steel). Intel doesn't sell processors much directly (ofc some of us here have custom built computers ;D ) yet its name is everywhere because its computers are so important and daily used while I think Hoyas products like medical equipment and optics in CD drives and lasers etc aren't nearly as daily and occupy a small niche of people, with most of those people not even caring about where these optics came from. So in my mind, I don't think Hoya needs/can get public attention and I think should be in a large part scratched out from Hoya's interest in Pentax.

Please correct me if I'm wrong. Not trying to offend anyone here although i love reading this discussion!