December 22, 2013

Are digital cameras out of the picture?

Consumers choose smartphones’ link to social media over image quality.

By John Ewoldt
Star Tribune

It’s a modern paradox: People are taking more photographs than ever before, nearly 400 billion this year, yet sales of cameras are shrinking.

click image to enlarge

Amrita Mohanty, 16, from left, Marta Williams, 16, and Michelle Mao, 15, take a Snapchat “selfie” while having coffee Dec. 12 at the Steepery Tea Bar in Woodbury, Minn. The ubiquitous smartphone is causing a decline in sales of digital cameras.

Photos by Renee Jones Schneider/Minneapolis Star Tribune

click image to enlarge

Roger Knight, left, works to set up Wes Sunvold’s new digital camera at National Camera Exchange in Golden Valley, Minn.

Overall, global shipments of digital cameras have fallen 30 percent this year, according to Christopher Chute, research director of worldwide digital imaging at IDC, a market intelligence firm. Camera stores are closing, and those that remain are emphasizing customer service or high-end products as they fight to stay relevant.

“It’s especially shocking because this was a market that until recently was growing by double digits,” he said. “This is the beginning of the collapse for cameras.”

And the obvious reason for the decline? The ubiquitous smartphone – a combination mobile phone, personal computer, data storage unit and camera, small enough to fit in a pocket. Nearly 60 percent of U.S. homes now have one, compared with 70 percent of homes that own more than one camera, according to The NPD Group.

But while digital camera sales fell by nearly a third this year, smartphone sales are expected to rise more than 32 percent.

Amanda Brady of Castle Rock Township, Minn., recently purchased Nokia’s new Lumia 1020 smartphone with a camera that sports 41 megapixels. She uses it for shots of her artwork to put on Etsy.com but also for nature pics during a recent family vacation to the Black Hills.

“We print quite often, and they don’t look pixelated,” she said.

It’s a culture shift that many believe started with the release of Apple’s iPhone 4 and 4S in 2010-2011, the first smartphones to have a backlit-illuminated sensor to produce brighter pictures with accurate colors to rival the quality of a decent point-and-shoot.

While sales of point-and-shoots have dropped the most, sales of single lens reflex cameras also have started to decline, although not as much. Sales through October were down 8 percent this year, said Ben Arnold, industry analyst at The NPD Group in Virginia.

Camera manufacturers such as Canon and Nikon, whose stocks have lost more than half their value since the iPhone was introduced in 2007, tried to stop the free-fall this holiday season with aggressive markdowns. The lower prices were expected to increase sales nearly 10 percent, Arnold said, but sales on digital single-lens reflex cameras increased only 1 percent compared to last year.

Even sales of the new highly touted mirrorless cameras, which were expected to see 15 to 20 percent growth on Black Friday weekend, fell 1.5 percent.

While many in the camera industry were hoping that consumers would continue to buy traditional cameras for lasting, better-quality pictures, Chute said that’s not happening. Consumers don’t care as much about image quality as they do the software that allows them unlimited, immediate sharing on social networks such as Facebook and Instagram, mobile image editing and manipulation, and cloud-based backup. “Image quality is now second to connectivity to Web services like Facebook,” he said.

One Minnesota specialty retailer, National Camera Exchange, isn’t ready to accept that. It’s pouring talent and resources into enlightening customers about what they’re missing by using only a smartphone. When National Camera Exchange President Jon Liss shows young parents close-ups taken with an SLR of a friend’s daughter swinging the bat during a T-ball game, they ask how he did it. “They don’t know that these cameras are better,” he said.

Still, smartphone camera technology continues to improve.

Brady, 34, said she’s never going back to a traditional camera. She recently took a picture of her son caroling at a nursing home from 40 feet away. “I leaned in, zoomed in, took the shot, edited it, and I was done,” she said. “I didn’t have to watch the rest through a little lens. I could actually enjoy the show,” she said.

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