Camera Phones Killing the Digital Camera Business?
Wednesday, January 31st, 2007 |The Camera and Imaging Products Association announced today that growth in digital camera shipments by Japanese makers in 2007 is expected to slow to 7.5 percent from a year earlier, when lower prices and a wider variety of models with interchangeable lenses spurred growth to 22 percent. The association did not provide any indication of why the slowdown will occur, but a likely culprit is the increase in sales of mobile camera phones. Projected shipments for camera phones by 2009 is over 900 million units.
A recent study by the Consumer Electronics Association says that 9% of pictures taken today are taken with a camera phone. So far, people seem to be switching between their camera phone and digital camera — taking photos at different times with different cameras.
However, this might change. The article says Tim Herbert, senior director of market research at CEA, predicts that as camera phones improve with three megapixel (and better) resolution, better storage and additional features, more people might use only camera phones for taking photos.
The CEA says the biggest area for growth in the digital still camera market will be products with six to seven megapixels. Digital camera manufacturers will, of course, continue to add features, such as image stabilization, better lenses, wireless options and photo/video sharing.
Pictures at Hand Ocotber 2006 Worldwide camera phone report states that by late 2008 or early 2009, the cumulative number of camera phones shipped will surpass the cumulative number of both conventional and digital cameras shipped in the entire history of photography-and camera phones have been on the market for less than a decade.
Camera Phone Shipment Forecast
Source: IC Insights
More data points from the Reuters article.
Demand will continue to lose speed as shipment growth is expected to slow to 4.3 percent in 2008, and 2.5 percent the following year, the association said.
The Tokyo-based industry group also forecast shipments of digital single-lens reflex (DSLR) models, geared for professionals and hobbyists, will continue to show double-digit growth in 2007, but their growth too will slow compared to 2006.
This year, shipments of DSLRs are forecast to increase 13.9 percent to 5.99 million units, lagging behind a 38.9 percent jump in 2006 to 5.26 million units.
Canon and Nikon Corp. <7731.T> are the dominant leaders in the market for DSLRs, while newcomers such as Sony and Matsushita Electric Industrial <6752.T> are also trying to expand in this segment as DSLRs are more profitable than compact devices.
Shipments of compact models, which have faced fierce price competition, is forecast to increase 7 percent to 78.9 million units this year, lower than the 20.9 percent jump in 2006 led by demand in emerging markets and the United States.
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