[monochrome]

That so-called "Law of Supply & Demand" comes with a lot of assumptions about the product (that it's unchanging through time), the customers (they are unchanging in time), the currency (unchanging in time), and the rest of the economy (also unchanging in time). It's known as a ceteris paribus ("other things being equal") law. Actual markets are full of exceptions to this supposed law because of violations of those required ceteris paribus assumptions.

Unless today's model of camera is a perfect substitute for last year's model (LOL!), any change in prices from last year's model to this year's model means nothing about supply and demand. There are ways of correcting for changes in products (see Hedonic regression - Wikipedia) where an analysis attempts to assign a value to the added megapixels, frames-per-second, ISO, pixelshift, etc. of the new model relative to the old one but it requires lots of data, other assumptions, and can suffer from flaws in statistical reasoning.

Price Elasticity of Demand works best to lower or limit price when there is a ready product substitute, so that Demand cannot overcome Supply. The converse also applies.

Brand-unique lens mounts, installed base of unique-mount lenses, new tech upgrades and Brand Identification Preference, for instance, can create Product Substitution Friction (Barriers to Entry by substitutes), thus promoting Price Inelasticity of Demand of a new camera (supports a high price). In the case of the recent, mature camera upgrade cycle, the old model has remained a decent substitute for the new model (they’re not differentiated enough) so the old-model price may actually be driving the new model price.

IMO this has some bearing on Pentax’s decision to create a time gap between sunset of K-3ll and introduction of a new APSc flagship. K-3ll was possibly good enough to be a controlling substitute for K-3x. The replacement tech jump must be substantial and the secondary market must be cleared - otherwise the K-3ll could drive the intro price of the replacement body.

Likewise an MILC is a good but not perfect substitute for a DSLR. In that case I believe a combination of factors, compounded by massive excess Supply of DSLR’a (Capacity Overrhang) is driving DSLR price, not outright Product Substitution. Adding premium features to DSLR’s to maintain price is a rational response under the circumstances.

I believe Ricoh foresaw the overcapacity of DLSR’s in 2012 and has patiently waited for an opportunity to compete for market share. Perhaps their recent orientation to Reference lenses and inventive product features portends a more active product cycle at Pentax in the future, now that DSLR capacity is normalizing.

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Last edited by monochrome; 05-06-2018 at 07:17 PM.

[rawr]

10 pages onwards in this thread ...

I am driven to ask: do all Pentaxians share the same concerns about Ricoh business strategies, product market share, price elasticity of demand etc etc, and apply those concerns to all their hobbies and consumer product purchases?

I personally don't worry a lot about the business strategies and market share of my refrigerator or washing machine maker, even my car maker. Maybe I'm weird.

[Larrymc]

10 pages onwards in this thread ...

I am driven to ask: do all Pentaxians share the same concerns about Ricoh business strategies, product market share, price elasticity of demand etc etc, and apply those concerns to all their hobbies and consumer product purchases?

I personally don't worry a lot about the business strategies and market share of my refrigerator or washing machine maker, even my car maker. Maybe I'm weird.

Nope not me. Not weird at all but pretty normal!! But what else would they have to worry about?

Larry

[monochrome]

10 pages onwards in this thread ...

I am driven to ask: do all Pentaxians share the same concerns about Ricoh business strategies, product market share, price elasticity of demand etc etc, and apply those concerns to all their hobbies and consumer product purchases?

I personally don't worry a lot about the business strategies and market share of my refrigerator or washing machine maker, even my car maker. Maybe I'm weird.

Nope not me. Not weird at all but pretty normal!! But what else would they have to worry about?

Larry

Not a worry per se but a valid thought exercise. You might not care is K-mount disappears, but I do. AFA white goods, hand tools and power tools, furniture, electronics and durable consumer items generally, yes, I do worry about reduced engineering quality of goods over the last decade to hold prices down for Walmart, Lowes and Costco. Our original Maytag and KitchenAid items lasted 25+ years, until the repair parts were sunseted. Their same-brand replacements nave averaged 5 years.

[rawr]

Not a worry per se but a valid thought exercise.

Fair enough.

I admit, even though in a previous life I did lots of work in new technology and markets, I always do learn something new from these intense Pentax threads.

White good engineering quality is indeed in decline. My 20+ yo domestic fridge and washing machine are still doing fine, however. May the Force be with them.

[Zygonyx]

Actually, less, from US anyway.

Interesting data point. US CO2 emissions down, EU up per IEA declarative report for upcoming UN Climate Change Conference. Reasons?: Less coal, more Nat Gas, better fuel mileage. Even SUV’s get 20mpg now.

Just sayin’

OK, sorry that my Tesla didn't make it all

[Rondec]

10 pages onwards in this thread ...

I am driven to ask: do all Pentaxians share the same concerns about Ricoh business strategies, product market share, price elasticity of demand etc etc, and apply those concerns to all their hobbies and consumer product purchases?

I personally don't worry a lot about the business strategies and market share of my refrigerator or washing machine maker, even my car maker. Maybe I'm weird.

Not worried. As Monochrome says, I do want to see new products (camera bodies/lenses/accessories) released for the K mount. But Ricoh's plan seems more sustainable than, say, Nikon's. They are already pretty lean and are releasing products only at the rate that they can afford to do so.

It's a pretty conservative strategy, but probably safer in the long run. Also, with that sort of mind set, it seems less likely that they would just ditch k mount cameras for the new, shorter registration camera.

[mecrox]

Not worried. As Monochrome says, I do want to see new products (camera bodies/lenses/accessories) released for the K mount. But Ricoh's plan seems more sustainable than, say, Nikon's. They are already pretty lean and are releasing products only at the rate that they can afford to do so.

It's a pretty conservative strategy, but probably safer in the long run. Also, with that sort of mind set, it seems less likely that they would just ditch k mount cameras for the new, shorter registration camera.

Ricoh’s plan seems sustainable for those who already like Pentax cameras. The question is whether that’s enough. Like or loathe Canonikon and co but they’ve never been hesitant about going after new business.

My guess is that the implosion of compacts hit all the outfits harder than we think, Ricoh included. With compacts that’s not just making fewer DSLRs but writing off whole factories. It’s taken some of them quite a while to get fully underway again.

[Rondec]

Ricoh’s plan seems sustainable for those who already like Pentax cameras. The question is whether that’s enough. Like or loathe Canonikon and co but they’ve never been hesitant about going after new business.

My guess is that the implosion of compacts hit all the outfits harder than we think, Ricoh included. With compacts that’s not just making fewer DSLRs but writing off whole factories. It’s taken some of them quite a while to get fully underway again.

I don't loathe any camera brand, although I do get a bit aggravated at the holier than thou attitude of the "my camera does better jpegs than your camera" Fuji shooters. I want to see brands continue with good competition. I just think it is clear that in today's marketplace it isn't enough just create me-too cameras. Just pitching a mirrorless camera out there that is a Nikon or Pentax version of the Sony NEX cameras is unlikely to succeed -- particularly since Sony has really perfected the tech side of things. How long will it take Nikon to catch up with equivalent auto focus speeds, EVF with minimal lag time, and a decent lens line up for their new mirrorless cameras? I have no idea, but I think it is unlikely that there will be a flood of people heading their direction based on this new release.

As far as compacts went, I didn't think that Pentax/Ricoh made their own compacts, but that they were contracted out to Chinese camera makers.

Canon and Sony have enough different aspects of their business that they can weather bumps in the road if the market turns south for a bit. Ricoh also has other ventures and photography is a bit of a side hobby for them. Nikon, on the other hand, is in trouble if things don't turn around. They won't go away, but they might drop back in market share considerably.

[NotSteve]

Huh? What does this even mean?

Ricoh’s plan seems sustainable for those who already like Pentax cameras.

[Winder]

Let me check this claim:

1. You say the demand for the DFA 24-70 is much higher than for the Tamron equivalent for both Canon and Nikon. Makes it quite a mega seller for Pentax which is about 1/10 the size.
2. You say the Canon 70-200/4 L is a really poor glass without any customer demand, because it is much cheaper (for years) than most any 70-200 lenses on the ILC market.
3. You say the Nikon 1 V3 was in huge demand as its long term price of 700 EUR because it was +50% more expensive than the megaseller Canon 700D.

None of the above products ever were even close to shortage, so lack of supply never drove their prices.

Did it ever occur to you that luxury entertainment electronics devices such as MILC and DSLR might be priced a lot different than rice?
The word "oligopoly" also ringing a bell?
That really is noob level, basic economics.

I didn't make any of those claims. We are talking about overall industry trends.

No it didn't occur to me that luxury entertainment item such as camera are different, because they are not. But why don't you demonstrate than on a basic supply/demand/price graph. Holding supply constant, show me how the price can rise without the demand curve shifting to the right. You might need to brush up on your "noob" economics.

---------- Post added 05-12-18 at 09:43 AM ----------

That so-called "Law of Supply & Demand" comes with a lot of assumptions about the product (that it's unchanging through time), the customers (they are unchanging in time), the currency (unchanging in time), and the rest of the economy (also unchanging in time). It's known as a ceteris paribus ("other things being equal") law. Actual markets are full of exceptions to this supposed law because of violations of those required ceteris paribus assumptions.

Unless today's model of camera is a perfect substitute for last year's model (LOL!), any change in prices from last year's model to this year's model means nothing about supply and demand. There are ways of correcting for changes in products (see Hedonic regression - Wikipedia) where an analysis attempts to assign a value to the added megapixels, frames-per-second, ISO, pixelshift, etc. of the new model relative to the old one but it requires lots of data, other assumptions, and can suffer from flaws in statistical reasoning.

That is incorrect. The laws of supply and demand don't make any assumptions about any specific product or the customer or the currency. The law of supply and demand simply provides a way to visualize the relationship between the supply, demand, & price of any good or service. Its not a "supposed" law. If you would like to present a good argument refuting the laws of supply and demand, I would love to hear it.

You're coming up with a whole lot of BS is a vain attempt to argue that supply and demand doesn't apply to the camera market. You are right, it that every year now models comes out that are better than the previous years models.... And that is another totally irrelevant point. The same can be said for computers, TVs, cars, smartphones, and every other piece of technology. All goods evolve over time. That has nothing to do with how the law of supply and demand apply. As I pointed out in previous posts, we are talking about trends over years. Aggregate data.

[reh321]

10 pages onwards in this thread ...

I am driven to ask: do all Pentaxians share the same concerns about Ricoh business strategies, product market share, price elasticity of demand etc etc, and apply those concerns to all their hobbies and consumer product purchases?

I personally don't worry a lot about the business strategies and market share of my refrigerator or washing machine maker, even my car maker. Maybe I'm weird.

When I purchase a new refrigerator or washing machine, I can continue to use the same ice cream or laundry soap. I purchased my first SLR, a Pentax, in 1979, then I switched to Canon in 1995 {packed away my K-mount lenses}, then back to Pentax in 2015 {sold or gave away my EF-mount lenses}; I really don't want to switch lens systems again

[Winder]

I am driven to ask: do all Pentaxians share the same concerns about ...... price elasticity of demand etc etc, and apply those concerns to all their hobbies and consumer product purchases?

Only those of us who did our undergrad in economics and also post on economics forums.

[normhead]

My guess is that the implosion of compacts hit all the outfits harder than we think, Ricoh included.

What you're never made clear is why anyone should care about your guesses? After all, we can all make our own guesses, and there's no evidence that your guess are any better than anyone else's.

[monochrome]

What you're never made clear is why anyone should care about your guesses? After all, we can all make our own guesses, and there's no evidence that your guess are any better than anyone else's.

Here’s a CIPA chart from 2013 of camera sales by type beginning in 1947.

Peak camera production in 2010 was 120,000,000+ Units! 110,000,000 were compacts. By 2013 compact production was only 20,000,000 - a loss of 80,000,000+ compact units in 4 years, and probably numbering a few hundred thousand now. Tag the OP’s charts onto the end of this one and it lends some credence to mecrox’s opinion and Ricoh’s decision to write down the compact camera plant as an impaired asset.

In my business a chart that looks like 2008-2010 is a euphoric peak - warning of really bad things to come.