Originally posted by Mark Ransom Why would Nikon be afraid of competing with their DSLRs? That makes no sense - a camera sale is a camera sale. Especially when it brings the possibility of more lens sales.
A camera sale may be a camera sale but the real challenge is recouping all the investments in designing both lines of cameras and lenses.
In the worst case, Nikon's MILC offering decimates their DSLR sales if DSLR buyers think that the Z6/Z7 is a sign that Nikon is abandoning DSLRs. Total camera sales could drop and Nikon would lose big time.
In the simple cannibalization case, Nikon loses DSLR sales in direct proportion to its MILC sales. Any profits made on MILC are offset by losses on DSLRs. Total camera sales don't change but having double the R&D costs to support two lines makes MILC a net money loser.
In the non-cannibalization case, Nikon's DSLR remain steady and the MILC sales add profits and repay all the investments in MILC development. Total camera sales go up although MILC only makes money if they go up enough.
In the best case, photographers are thrilled that Nikon offers decent cameras of both types so that both DSLR and MILC sales grow. Total camera sales go way up and Nikon makes a lot more money.
Of course, all four scenarios will happen at the level of camera buyers. Some potential DSLR buyers will be turned off by Nikon's MILC moves, some potential Nikon DSLR buyers will switch to Nikon MILC, some new MILC buyers will join the Nikon tribe, and some enthusiasts will buy both MILCs and DSLRs. The bottom line is that Nikon MILCs will only make make money for the company to the extent they bring sufficient volume of new sales to Nikon (taking sales away from Sony, Canon, etc.) rather than people substituting a Nikon MILC for Nikon DSLR.
I'm sure Nikon executives are biting their nails over which of these scenarios will come to pass because the first two scenarios definitely lose money for Nikon.