Forgot Password
Pentax Camera Forums Home
 

Reply
Show Printable Version Search this Thread
09-14-2013, 10:10 AM   #511
Pentaxian
mecrox's Avatar

Join Date: Apr 2009
Location: Oxford, UK
Photos: Gallery
Posts: 1,912
QuoteOriginally posted by monochrome Quote
Hoya acquired Pentax in 2007 for $1 Billion, including endoscopes. Pentax was already restructuring, having sold eyeglasses and making refinancings, and fending off a initial offer from Hoya and Sparx (Long PF History Post from 12/2006). IMHO Pentax last made a good business decision in about 1968, but that's just my opinion.

Sony's investment is just an equity investment, but makes Sony the largest shareholder in Oly, which includes all the other optical equipment products of Olympus, not just cameras, and forms a new joint venture for medical equipment.

I suspect Hoya very quietly moved younger optical engineers to the medical devices companies, retired the older engineers, then sold Pentax Imaging for $125MM because the ROE was less than 20% - their minimum standard. There remains a Pentax engineering team, and a Ricoh engineering team was merged to it.

There is Ricoh capital and cash flow. Ricoh is conservative, iterative and long-term oriented. Pentax played for the splashy Milestone every five years -- the Hail Mary pass that would save the company. We're not accustomed yet to the change in philosophy.
I don't think anyone yet has any idea what this "philosophy" might be. Ricoh are primarily a B2B company, as were Hoya. The irony is that Olympus might still be going and still turning out loss-making cameras long after Ricoh has folded Pentax because Ricoh's B2B philosophy - "conservative, iterative and long-term oriented" - translated to the consumer electronics world as "intensely dull, overpriced and hard to find" and so no one bought any of their cameras.

Of course I am playing devil's advocate. But in the fashion-led, fickle CE world I'd imagine one needs buzz, pizzazz, excitement, etc, etc. Ricoh are clearly nosing around this - witness their recent marketing around reasons to choose Pentax - but they are not there yet. To their credit they are at least further along the road than Hoya which never left the starting blocks. Still, ways to go. Christmas and the end-of-year buying season are roaring up upon us and there is still silence from Japan ...

09-14-2013, 10:30 AM   #512
Lens Buying Addict
monochrome's Avatar

Join Date: Mar 2008
Location: Kirkwood (St. Louis) MO
Photos: Gallery | Albums
Posts: 19,462
See, here's the thing. Ricoh isn't thinking so much about Christmas 2013. They're thinking more about Christmas 2020. If I have to choose whether Ricoh or Olympus will be making cameras in 2020 I'd pick Ricoh in heartbeat.

I really don't understand the fetish with doom of Pentax talk unless it is that Pentax has been sort of going bankrupt since the 70's and sort of went out of business when Hoya bought them - so now all people can think is they're going out of business. We keep making the same points about this and that being broken or wrong or not done. And as Ricoh fixes things we say, "Well, sure, they're actually marketing, but it isn't good marketing, or they don't have the right stuff to compete, or they're not in the stores so what good will it do, or it isn't FF . . . . . . "

So what will people complain about here when all those things are fixed and they have 15% of the market?

Last edited by monochrome; 09-14-2013 at 01:01 PM.
09-14-2013, 10:35 AM   #513
Loyal Site Supporter




Join Date: Apr 2010
Location: Tennessee
Posts: 5,414
QuoteOriginally posted by Kunzite Quote
I don't remember the $150 Nikkei estimate ever being confirmed, but it seems it is now the accepted "truth". Oh, well...
Olympus is whole, including a strong medical division (and, like with Hoya and Pentax, that's what Sony's interested in). I agree, they invested quite a lot into the 4/3 and m4/3, but that doesn't makes them healthier. Their 4/3 system, pretty young and marketed a lot, with all its "pro" glass, is now officially dead; and the last IR report is talking about "an increase in operating loss in the Imaging Systems Business".
Terms of the deal were not disclosed but Japanese business paper Nikkei Business Daily reports a price of about 10 billion yen ($124.2 million).

The news reports were at $124 million.

Olympus is much healthier with substantial assets. Pentax was/is a gutted shell that will take a few years to rebuild. While it is possible Sony just shelled out $600 million without doing its due diligence on health and value of Olympus, I highly doubt that to be the case.

An operating loss... yes.... I try to run an operating loss ever year for tax reasons. If I was trying to sell my company I would cut costs to show a profit, and make my company look more valuable from a cash flow perspective.

Last edited by Winder; 09-14-2013 at 10:52 AM.
09-14-2013, 10:51 AM   #514
Loyal Site Supporter




Join Date: Apr 2010
Location: Tennessee
Posts: 5,414
QuoteOriginally posted by thibs Quote
Mmm better have a small business gaining money than a big one with solvency problems IMO.
No. Better to have a company that is investing in its future (R&D) and just breaking even. Olympus didn't have a solvency problem. They could have reduced costs if that was needed. They could have done what Pentax did and slash R&D and future product development. Olympus had quite a few options and Sony made them the best deal. Its a win/win for both companies so far. Long-run, who knows?

09-14-2013, 11:02 AM - 1 Like   #515
Pentaxian
mecrox's Avatar

Join Date: Apr 2009
Location: Oxford, UK
Photos: Gallery
Posts: 1,912
QuoteOriginally posted by monochrome Quote
See, here's the thing. Ricoh isn't thinking so much about Christmas 2013. They're thinking more about Christmas 2020. If I have to choose whether Pentax or Ricoh will be making cameras in 2020 I'd pcik Ricoh in heartbeat.

I really don't understand the fetish with doom of Pentax talk unless it is that Pentax has been sort of going bankrupt since the 70's and sort of went out of business when Hoya bought them - so now all people can think is they're going out of business. We keep making the same points about this and that being broken or wrong or not done. And as Ricoh fixes things we say, "Well, sure, they're actually marketing, but it isn't good marketing, or they don't have the right stuff to compete, or they're not in the stores so what good will it do, or it isn't FF . . . . . . "

So what will people complain about here when all those things are fixed and they have 15% of the market?
It's not doom. It's more like gloom, watching many of the others making all the running and getting their ducks in a row for the end-year selling season. It's easy to say "oh, nice camera but they are simply losing money" or "who needs that gimmick?" but it's the others whose cameras are in the stores and, in many cases anyway, selling through. And as for thinking about Christmas 2020 rather than Christmas 2013, imho it's a great way to bankrupt a company. Nokia tried to bet the farm on an imagined and imaginary future using the assumptions current in about 2002, But they hadn't thought of the iPhone and then and look what happened. I'd have thought the premium these days is on quick, nimble, adaptable so that a company can focus much closer in and can be quickly re-purposed to take the best advantage of new technology or simply accommodate unexpected events like natural disasters or banking crises. It's the lumbering ones who can't change quickly which are at risk, I think. Digital photography is still in relatively early days. There are a lot of changes and surprises still to come.
09-14-2013, 11:05 AM   #516
Pentaxian




Join Date: Apr 2007
Location: Romania
Posts: 8,416
I took the $150 million from your post, then edited to 125 - but whatever. Your quote is from DPReview, way too far away from the source; and I don't trust a single source (Nikkei) anyway. If the exact number is known, why only Nikkei knows about it?

As I said, Olympus is whole; and you're comparing all of it with Pentax Imaging Systems. Yet Olympus Imaging Systems is about 14.5% (net sales from total), and their only division which is healthy and growing is, unsurprisingly, Olympus Medical Systems (which accounts for more than half of the entire company). Medical Systems is what Sony's interested in, and not IS.

Then, Canon and Nikon is doing wrong by making large profits and Olympus is doing it right Come on, you know very well that's not why they're losing money.
09-14-2013, 11:15 AM   #517
Lens Buying Addict
monochrome's Avatar

Join Date: Mar 2008
Location: Kirkwood (St. Louis) MO
Photos: Gallery | Albums
Posts: 19,462
QuoteOriginally posted by Winder Quote
While it is possible Sony just shelled out $600 million without doing its due diligence on health and value of Olympus, I highly doubt that to be the case.
Olympus had been falsifying its financial reports for twenty years. No one knows, and in the obtuse corporate culture of Japan it is unlikely anyone ever will know the true financial condition of Olympus. Panasonic took a look at the "books" and declined to participate in the restructuring. Sony reluctantly made an equity "investment" in Olympus without which it would truly have been broken up, then promptly set up a joint venture with Olympus, into which was transferred (Olympus Medical) the medical components products (which quite coincidentally have approximately the value of Sony's investment).

It isn't really a good argument to compare Pentax's Digicam operation to Olympus' entire optical equipment, B2B, medical imaging and Digicam operation and then say Olympus is healthier than Pentax. Using your comparison, Hoya was healthier than Olympus.

Ricoh sees Pentax as a growth opportunity. When you already are the largest company in your mature sector - the 279th largest company on earth, your growth opportunities in that sector are limited. B2C is where Ricoh can gain growth. I wouldn't put it past Ricoh to buy Olympus' ailing, moribund digital camera operation (patents and manufacturing facilities - the brand has no value) from Sony in much the same way they bought.Pentax from Hoya. That has been the Ricoh way in B2B.
09-14-2013, 11:17 AM   #518
Loyal Site Supporter




Join Date: Apr 2010
Location: Tennessee
Posts: 5,414
QuoteOriginally posted by Kunzite Quote
I took the $150 million from your post, then edited to 125 - but whatever. Your quote is from DPReview, way too far away from the source; and I don't trust a single source (Nikkei) anyway. If the exact number is known, why only Nikkei knows about it?
Give me a break..... DPR got it from UPDATE 2-Japan's Hoya: to sell Pentax camera business to Ricoh | Reuters

Does anyone but the Nikkei have reason to care what happened to a company with less than 2% market share? The only reason they cared is because Ricoh is huge Japanese company. Ricoh decided to take some money that was left over from last years Christmas party and buy Pentax.

09-14-2013, 11:20 AM   #519
Lens Buying Addict
monochrome's Avatar

Join Date: Mar 2008
Location: Kirkwood (St. Louis) MO
Photos: Gallery | Albums
Posts: 19,462
QuoteOriginally posted by mecrox Quote
It's the lumbering ones who can't change quickly which are at risk, I think. Digital photography is still in relatively early days. There are a lot of changes and surprises still to come.
So who is lumbering - Canon and Nikon who can't stop producing and experience involuntary inventory build of tiny Pentax, that has chosen to hold down production in the face of a slowing global economy while making incremental, disciplined changes ?
09-14-2013, 11:24 AM   #520
Lens Buying Addict
monochrome's Avatar

Join Date: Mar 2008
Location: Kirkwood (St. Louis) MO
Photos: Gallery | Albums
Posts: 19,462
QuoteOriginally posted by Winder Quote
Give me a break..... DPR got it from UPDATE 2-Japan's Hoya: to sell Pentax camera business to Ricoh | Reuters

Does anyone but the Nikkei have reason to care what happened to a company with less than 2% market share? The only reason they cared is because Ricoh is huge Japanese company. Ricoh decided to take some money that was left over from last years Christmas party and buy Pentax.
It is well understood in the financial community that the $125MM is table stakes - the ante - and the real money comes later. The capital and cash flow infusion actually starts right about now and increases consistently beginning Ricoh FYE 04/2015 (starts March 2014).

Last edited by monochrome; 09-14-2013 at 12:58 PM.
09-14-2013, 11:26 AM   #521
Pentaxian




Join Date: Apr 2007
Location: Romania
Posts: 8,416
Winder : That's not even Nikkei's original statement. And if they couldn't care less about Pentax - does that raise your confidence in that number? Sorry, I can't simply accept that $124.2 million is it - the exact number, and that there's nothing else besides it. I don't like not being able to double check such unofficial figures, not being able to see the original statement. I'm not rejecting the number, either, of course - how could I? I'm only advising for caution; and that you can't just compare two numbers, regardless of what they mean.

Anyway, once again monochrome is spot on: whatever that number actually is, Pentax/Ricoh Imaging is not limited by it.

Last edited by Kunzite; 09-14-2013 at 11:37 AM.
09-14-2013, 11:26 AM   #522
Pentaxian
mecrox's Avatar

Join Date: Apr 2009
Location: Oxford, UK
Photos: Gallery
Posts: 1,912
QuoteOriginally posted by monochrome Quote
So who is lumbering - Canon and Nikon who can't stop producing and experience involuntary inventory build of tiny Pentax, that has chosen to hold down production in the face of a slowing global economy while making incremental, disciplined changes ?
"Pentax, that has chosen to hold down production in the face of a slowing global economy while making incremental, disciplined changes ?" So say you. But have Ricoh laid that out publicly as their strategy or is it a case of "not much is happening so let's make up a storyline that what's really happening is ..."? Besides, I can't see Ricoh objecting to having, say, Canon's market share. I think you're right that Nikon may have been caught out but Canon strike me as a lot cannier.
09-14-2013, 11:39 AM   #523
Lens Buying Addict
monochrome's Avatar

Join Date: Mar 2008
Location: Kirkwood (St. Louis) MO
Photos: Gallery | Albums
Posts: 19,462
QuoteOriginally posted by mecrox Quote
But have Ricoh laid that out publicly as their strategy or is it a case of "not much is happening so let's make up a storyline that what's really happening is ..."?
I actually have that statement, personally, directly from Pentax executives April 30th - and both Nikon and Canon are still producing more cameras then they're shipping. Expect liquidation pricing Black Friday if holiday sales aren't spectacular (at least in the US summer retailer advance orders weren't anything to be excited about).

From the last paragraph (Note I intentionally did not state Canaon and Nikon were the companies mentioned as overproducing). Click the red >> to go to the OP.
QuoteOriginally posted by monochrome Quote
Lastly he counseled a bit of patience. He cited CIPA data that show other manufacturers are producing significantly more cameras than they are selling, and thus experiencing an involuntary inventory build. Pentax is not subjecting itself to this risk. As a company Ricoh is twice the size of Nikon and half the size of Canon, so these business decisions are strategic, all made under an intermediate term belief that there can be a third major camera brand and it will be Pentax, and that the 20 year Vision remains to be Number 1. Within that strategy there are shorter tactical actions that don’t appear to make sense without the intermediate and long term context. He asked again that we be patient.
09-14-2013, 11:48 AM   #524
Pentaxian
mecrox's Avatar

Join Date: Apr 2009
Location: Oxford, UK
Photos: Gallery
Posts: 1,912
QuoteOriginally posted by monochrome Quote
I actually have that statement, personally, directly from Pentax executives April 30th - and both Nikon and Canon are still producing more cameras then they're shipping. Expect liquidation pricing Black Friday if holiday sales aren't spectacular (at least in the US summer retailer advance orders weren't anything to be excited about).

From the last paragraph (Note I intentionally did not state Canaon and Nikon were the companies mentioned as overproducing). Click the red >> to go to the OP.
Well fair enough, sounds a well thought through arrangement. However, there is a catch. Canon, Nikon and others may well end up with liquidation pricing later this year but such a tactic might shaft the plans of full-price manufacturers right royally. Why buy full price when you can catch a bargain from the next guy? The liquidators may lose money but the full-price guys who are doing everything by the book end up losing too. They lose sales. Pretty soon, if the liquidators get into the habit of it, no one expects to pay remotely full price for anything any longer and the prudent fuller-price guys are dragged down another peg. Yes, it's a race to the bottom. Deep pockets required.
09-14-2013, 11:56 AM   #525
Lens Buying Addict
monochrome's Avatar

Join Date: Mar 2008
Location: Kirkwood (St. Louis) MO
Photos: Gallery | Albums
Posts: 19,462
QuoteOriginally posted by mecrox Quote
Well fair enough, sounds a well thought through arrangement. However, there is a catch. Canon, Nikon and others may well end up with liquidation pricing later this year but such a tactic might shaft the plans of full-price manufacturers right royally. Why buy full price when you can catch a bargain from the next guy? The liquidators may lose money but the full-price guys who are doing everything by the book end up losing too. They lose sales. Pretty soon, if the liquidators get into the habit of it, no one expects to pay remotely full price for anything any longer and the prudent fuller-price guys are dragged down another peg. Yes, it's a race to the bottom. Deep pockets required.
Perhaps. Time will tell! Who is to say they don't plan Black Friday (week) specials - they had them last year. That's an open strategy with MAP pricing.

If they have to meet prices, though, they'll do it without the additional cost of inventory carry and without having sunk all those payrolls into assembly workers.

"Ricoh is twice the size of Nikon and half the size of Canon . . ."

I really just want the discussion to see both sides - I don't have any axe to grind. I do believe Ricoh is serious about making Pentax succeed and they're not the sterotypical, benighted dark suited Japanese businessmen. The best case I can make for that now is the "5 Reasons to Choose Pentax" and "4 Lenses" pages on the .jp website. They're quite honest about what they have and, by omission, what they don't have (everything necessary for Sports/Action, which are Canon/Nikon strengths). By implication that should tell us they know what they need to work on and why they say they want to be an alternative to CaniKon, not another CaNikon.
Reply

Bookmarks
  • Submit Thread to Facebook Facebook
  • Submit Thread to Twitter Twitter
  • Submit Thread to Digg Digg
Tags - Make this thread easier to find by adding keywords to it!
cameras, check, christmas, discussion, future, pentax, pentax news, pentax rumors, plans, releases
Thread Tools Search this Thread
Search this Thread:

Advanced Search


Similar Threads
Thread Thread Starter Forum Replies Last Post
Beginner's Woe's with new Camera Stevizzy Troubleshooting and Beginner Help 25 10-29-2012 08:10 AM
Photokina 2012: Leica presents its new S medium format camera jogiba Non-Pentax Cameras: Canon, Nikon, etc. 5 09-21-2012 01:45 AM
Machinery Dividing by Zero: Mama's New Ride Sailor Post Your Photos! 29 02-04-2012 11:29 AM
Misc A New Christmas Camera . . . . . Sailor Post Your Photos! 18 01-01-2011 06:52 AM
Pentax's Third new camera..... New Distribution Channel interested_observer Pentax News and Rumors 50 09-30-2010 12:23 PM



All times are GMT -7. The time now is 04:18 AM. | See also: NikonForums.com, part of our network of photo forums!
  • Red (Default)
  • Green
  • Gray
  • Dark
  • Dark Yellow
  • Dark Blue
  • Old Red
  • Old Green
  • Old Gray
  • Dial-Up Style
Hello! It's great to see you back on the forum! Have you considered joining the community?
register
Creating a FREE ACCOUNT takes under a minute, removes ads, and lets you post! [Dismiss]
Top