Nov 15, 2005

Why Aren’t Camera Companies Making Money?

Source: PC Magazine
Written By Terry Sullivan and Kyle Monson

We’ve been hearing foreboding tidings out of Japan all week: First Konica Minolta announces pretty serious headcount reductions and product streamlining as a way to combat the huge losses they’ve been suffering. The word from their latest financial report, issued earlier this week, is that they’re “shifting (their) expansion strategy to focus on high-value-added products.” In other words, we can probably expect Konica Minolta to phase out low-end consumer cameras and target photo enthusiasts and D-SLR users.

The second tidbit of news from Japan came on Wednesday, when Olympus announced basically the same thing: The company will be moving away from consumer compact cameras and focusing more on D-SLR and enthusiast models. We also know that Pentax isn’t doing too well and Kodak has been struggling, despite a huge market share of compact cameras.

What’s going on here? Inexpensive digital cameras are selling like hotcakes, right? So why are so many camera manufacturers losing money and/or pulling out? Lead Analyst Terry Sullivan and Associate Section Editor Kyle Monson chew the fat over the state of the consumer camera industry, where it’s headed, and what it means to you as a consumer.

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