Cameras and Photography Explained

Nikon's stated goal is to become the market leader in cameras, essentially knocking Canon off the top step of the podium.

With Nikon's quarterly financial statement coming later this week, now's a good time to ask: how's that goal coming along?

Not so well.

Nikon has been stuck in the second position in serious cameras for a long time now. This started with the Canon EOS film models getting to solid autofocus capabilities and being better marketed before Nikon got there. The film era ended with Nikon clinging to just a bit more than half the unit volume of Canon in serious cameras.

Digital reset the numbers a bit, especially since Nikon got an early start at the top end. But Canon responded and re-established dominance in DSLRs.

I write this because the 2012 numbers are coming clear now. While Nikon's fiscal year is offset by a quarter from Canon's, we can already extrapolate some head to head data from numbers published so far. Basically it goes like this: Canon 40.1%, Nikon 34.7% of the interchangeable lens camera market worldwide. (This is units shipped from manufacturer, not sold at retail, and it includes mirrorless cameras, where Nikon had an advantage of shipping some the entire year, while Canon only had one quarter of shipments. There's a chance I'll have to adjust this slightly when Nikon reports its final numbers, as I'm taking their last estimates into account here.)

Canon's forward estimate for 2013 turns out to be an increase to 40.5% of the interchangeable lens market (Canon projections and CIPA estimates combined; for more on Canon and CIPA numbers, see my companion article on sansmirror.com). So one has to ask: what is it that Nikon can or will do that is going to cause it to achieve its goal of passing Canon? Remember, that's been the goal for over two decades now, and while Nikon has had a couple of very brief periods where it managed to tempararily overcome Canon's lead, Canon has always responded immediately with product that sets things back the way they were.

Let's first talk about what won't get them past Canon:

• Following instead of leading. Canon was first to full frame sensors. Nikon took several years to get there after Canon. Canon was first with dedicated video DSLRs. Nikon isn't there yet. Canon was first with a large sensor mirrorless camera. Nikon isn't there yet. Canon was first with the f/4 zoom set. Nikon has just now gotten there. Speaking of which:
• Optical failures. Surprisingly for a company supposedly centered around optics expertise, it isn't the optics side where Nikon is leading the way. I already mentioned being last with an f/4 set of zooms, but there are so many gaps, holes, late-for-replacement, and last-to-technology problems in Nikon's lens lineups that it should be not just embarrassing, but near beat-down shameful to Nikon at this point. I've covered the missing lenses issue enough that I'm not going repeat the specifics, but the problem is now so bad I'm of the opinion that Nikon is no longer an optical leader. Indeed, it's interesting that Nikon's corporate philosophy statement now leads with "unwavering commitment to the study of light" and not "push the boundaries of optical technology" as it used to.
• Brand dilution. I'll use an anecdote here: a friend bought a Coolpix just prior to my Grand Canyon rafting trip last year, as she wanted to be able to take a few of her own pictures on the trip even though several of us on the trip were documenting pretty much the entire trip with serious gear. Day two the camera suffered a problem I've found common with Coolpi: the lens wouldn't deploy when turned on because a small grain of sand had wedged in the barrel. If you attempt to create the next generation of DSLR users by first selling them compact cameras, you'd better make sure that they have a positive experience with the original product they bought from you. That's not really happening with Coolpix.
• Hiding from the user. The customer support complaints continue to pile up on my desk. I have to wonder how high the pile is on someone's desk at Nikon (they probably can't get to their desk any more, which may be why they're not answering ;~). Enforced silence on real issues is even worse. Hiding behind voice mail systems and an online database that lags the reality of the service department doesn't help.

You'd think that just fixing those four things would get Nikon a ways further towards their ultimate goal. Unfortunately, it appears that Nikon is hoping that Canon will just someday "fail bigger" than Nikon does, and that will allow them to pass into the lead.

Now some say that I'm only negative in my writings, so let me point out a few positive things that have happened in Nikon's quest to top Canon:

• In the FX lineup, Nikon has created a strong group of products. The holdover lenses coupled with a few updates is holding its own, and all three of last year's FX bodies are arguably strong. Stronger than the similar Canon offerings? Debatable. In some ways yes, in some ways no. So debatable. You need to be clearly better to pass a rival with a lead, but Nikon has been playing the FX game well ever since the D3.
• The CX product line was certainly a step outside the traditional box, and there's a lot to like about those products (most of the complaints about the Nikon 1 series so far aren't about performance, it's about small things like user interface goofs and lack of a full system). Here, Nikon has shown a willingness to do something different from Canon, and Nikon is indeed doing better than Canon in mirrorless so far. But Canon just got started.
• The constant low-end DX iteration has actually "fixed" a lot of my (and others') complaints about some of the earlier models. For consumer-oriented cameras, the D3200 and D5200 are solid performers. Stronger than Canon offerings? Again debatable. In some ways yes, in some ways no. Here, too, there isn't anything that makes Nikon a clear leader over Canon, so it's tough to take the lead from them just by iterating product. Still, Nikon was first to 24mp, and managed to do so with low noise and high quality. Canon APS lags a bit now.
• Nikon now markets with relative constancy. While I think some of the ads miss the point, Nikon does now have a very visible and constant ad presence, something that had been missing in the past. Moreover, here in the US, they were the first to truly get coop advertising driving customers to stores and products off shelves, and they've not relented on that since figuring it out. Kudos to getting a tactic right and sticking with it.
• Nikon sometimes gets aggressive. The free-lens-with-D600 offer last Christmas buying season was incredibly aggressive. It provoked a lot of buying where that otherwise might not have been, and if you're going to pass your competitor in market share, you need to provoke a lot of buying. That Nikon beat Canon to market with the entry FX model and was aggressive in pricing compared to the Canon 6D is indeed the first place other than CX where you might be able to point to Nikon looking a bit more like a true leader rather than a follower.

Which brings us back to the premise of this article: how does Nikon take the mantle of camera leader from Canon?

• Completeness. I always get some negative pushback when I question Nikon's choices in product offerings. For example, lately there's been a lot of people telling me that the DX consumer zoom lens lineup is good enough, because that's all people buy. Two things: (a) self-fulfilling prophecy; and (b) are you trying to be the leading photography vendor or just a pusher of boxes? I have a strong bias towards making a strong, broad, complete, and task centric lineup of product. Such lineups are difficult for competitors to break. If you leave gaps you leave vulnerabilities to others trying to gain their own market share. So: (1) Fill out the lens lineups. Race to get the CX line filled with a full range of lenses and accessories. Find the real gaps in the DX line and fill them, especially since Canon has those same gaps. Get the FX lens replacements that are overdue done and in customers hands. Think photographically when doing this, not just what might push boxes out the door. What do I mean by that? For example: how many of those 18-200mm DX users Nikon sold a lens to eventually realized that they had merely bought convenience, not true photographic purpose, and eventually sought something else? How many of them then looked in the Nikon lineup for the DX lens that would solve their photographic problem and found that it didn't exist? Oops: pushed a lot of boxes but didn't lead. (2) Get back to leader status on optical breakthroughs. Sure, Nikon was early to ED glass and Nano technology, but was that it? Canon beat Nikon to diffraction optics, for instance. Are we done with optical breakthroughs? I sure hope not, but if we are, then this increases the need to complete my point #1 ;~).
• Listen more carefully. I'm going to make a bold statement here: most photography buying is going to become just pro users and very serious hobbyists soon. Everyone else will have "image taking devices" that are "good enough" and which Nikon (and Canon for that matter) really can't make (e.g smartphones). But here's the thing about pros and the prosumers: they are a replacement market only. To sell them something new it has to perform better, get rid of user frustrations, and have the features that the serious user wants, not just a bunch of new menu options that really just disguise licensed stuff stuck into the ASIC. Simple example: our cameras are computers, so why can't they bracket anything we select? If we're not sure of a choice, let us simply bracket it. Isolating your engineers behind language and cultural barriers, voice mail walls, and hiding their email addresses doesn't cut it in this world. Your engineering team needs to be photographically oriented, and they need to interact with worlds' photographers constantly, not in a back room with a few pros every four years at the Olympics.
• Move more rapidly. It isn't a hardware world any more. While we buy hardware (cameras, lenses, flash units), the primary job of photography is a software chore. It starts with the firmware in the camera, but it extends outside the camera, as well. The software world moves quickly, and in small increments (with a big movement every once in a while). I'm really surprised that no camera maker has offered a "base firmware" option with the initial camera and a subscription to regular firmware updates that aren't just bug fixes, but extensions that users want (see listening, above). Would I subscribe to this if done right? You betcha. But I'd also want to know that photographers are at the heart of those changes (which is why Sony's PlayMemories initiative is a dead end). A programmable camera is something I've mentioned before, and that's part of this, too. If a group of serious users are making your hardware better, guess which hardware starts to look better to new purchasers?
• Great products require great QA and great service. I have this constant impression that Nikon likes to undermine themselves. They don't seem to mind having their foot hurt as long as their hands are still giving out more boxes to customers. That hurt foot might feel a lot worse when the box demand goes away and you have more time between handing boxes out to think about how much your foot hurts, though. The Internet fora are filled with Nikon support and repair horror stories. My In Box is certainly filled with them (I'll get back to publishing those when the new site launches, so keep them coming, good or bad). It's a topic of discussion in almost every group of photographers I've joined physically, too (workshops, seminars, trade shows, etc.). Canon isn't perfect at this themselves, but the level of din is higher on the Nikon side. Without fixing this there's always the thought in the back of a potential purchasers' mind: "will I be one of those that succumb to Nikon's terrible customer service?" Hard to pass a competitor if the perception is that the competitor is better than you at fixing the things that do go wrong.

I actually expect Nikon's upcoming quarterly report to be positive. They should hit their estimates for units and revenue, which were somewhat aggressive. But they won't pass Canon ;~). So succeeding at keeping shareholders happy: check. Succeeding at primary goal of passing Canon: no check.

Something I get hit with when I write things like this article is this: if Nikon's profitable and growing, they must be doing something right, so can the negativity Thom. Sorry, but just being profitable and growing isn't the full story. The real question is whether Nikon is being as successful as it could be, and my answer to that is a clear no. I believe that they've been mostly coasting and cost cutting and not actually particularly seriously pursuing their goal of unseating Canon as the camera market leader via product definition. Much of Nikon's success is in "moving boxes," not making photography equipment the best it can be. Nikon may have pushed out more than 10 million Coolpix in a declining market, but is that actually pushing their primary business of photography forward? Most of those Coolpix will die quickly and will likely be replaced by something other than a Coolpix, as the smartphone market continues to ramp. In other words: thanks for the D800E, but from about the DX line down it's about moving boxes.

Remember, Nikon is about three-quarters a camera company. Unlike any of the other Japanese camera companies it really doesn't have other businesses to fall back on if it fails at photography. I would argue that Nikon needs to pass Canon as the market leader. Dramatically so. Nikon needs to lead the way to the future of high-end imaging. They need to make Canon look like a follower.

Which is probably all just a long-winded way of saying Nikon needs a D300s replacement ;~).