Digital moves to top-tier cameras

As more companies sell high-end digital cameras, they could force venerable photography brands out of business.

Like many serious amateur photographers, Chad Marek has a sense of brand loyalty that rivals the attachment of many sports fans to their home teams.

But the reasons for his commitment have as much to do with practical matters as emotional pull. The 10 Konica Minolta digital and film cameras owned by Marek, a 35-year-old quality-control engineer who is also the president of a Chicago camera club, work only with lenses designed for that brand. Similarly, Marek's collection of about 33 Minolta lenses--he's lost count--will not fit any other make of camera.

So Marek was more than a little concerned when Konica Minolta said last month that it was abandoning the photo business--both digital and film--and selling some of its camera technology to Sony.

"Minolta had a great name in photography--they were No. 3 in the market when I bought my first camera," Marek said. "I can't imagine being without it now."

Not all of the traditional leading camera makers have taken Konica Minolta's drastic step. Faced with brutal competition in the consumer market for compact digital cameras, several have turned to , which feature interchangeable lenses, to maintain their profits.

Those high margins have not escaped the notice of relative newcomers like Sony, Panasonic and Samsung. At the annual Photo Marketing Association International show next week in Orlando, Fla., all three are expected to further outline their plans to move into photography's top tier. When that occurs, the challenge for some of photography's most venerable brands may be simply to survive.

New York Times

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"Life used to be stable in the camera business," said Ned Bunnell, director of marketing at Pentax Imaging. "But if you look at what happened to the personal computer industry, I think it's logical to think that the same sort of consolidation would take place in the camera industry."

Sony has already risen to the No. 3 spot in digital camera sales in the United States, with 15.8 percent of the market, just behind Canon, at 17.2 percent, and Kodak, at 16.9 percent, according to Current Analysis, a research firm in Sterling, Va.

And as the competition gets keener, life becomes fundamentally different for camera companies, which used to operate at a stately pace with new product cycles measured in years. Nikon's top-of-the-line F-series of cameras, for example, has been revamped only six times over nearly five decades.

"In the past, as a camera maker we were able to take it easy, watch what was happening," said Makoto Kimura, the president of Nikon Imaging and a senior managing director of Nikon, its parent. "Now we've had to revitalize ourselves."

In 1988, Sony introduced what is generally regarded as the first successful digital camera for consumers, the Mavica, which stored its photos on a standard diskette. While not breathtaking technology, the disks meant that the Mavica was the first camera that offered an easy way to transfer photos to computers.

"That was when we started to think that other players were beginning to look at the possibilities of digital photography," Kimura said.

With digital photography, Sony and other electronics makers immediately boasted advantages that offset their lack of optical experience. From its video camera business, Sony knew how to design and manufacture charge-coupled devices, or CCDs, the light-sensing chips that became film's most common digital replacement. Making the chips is beyond the financial or technical reach of most camera makers, several of which rely on Sony and other electronics companies as suppliers.

The electronics companies' main advantage, however, was far less technical. The shift to digital photography meant that even relatively expensive cameras were increasingly purchased at electronics chains rather than specialty shops. The traditional camera makers were, by and large, left learning how to elbow their way onto shelves at Best Buy, Staples and Circuit City as well as adjusting their systems to meet the inventory and logistics demands of the national chains.

"I was with Sony for a number of years," said Jeff R. Clark, the senior digital photography analyst at Current Analysis. "Supply chain management was probably more important to that company than the products it made."

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