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EPTE Newsletter: New "Developments" in Digital Cameras

Sales of digital cameras in Japan have steadily decreased since last 2012. Sales experienced seasonal fluctuations, but forecasts have been correct since 1990. The reason for this is very simple: Consumers most often buy cameras during holidays and special events. This trend has repeated itself since the early 1990s; however, monthly sales declined between 30 and 50% compared to the same quarter of last year and average selling prices have increased.

Japanese camera manufacturers have been the world's leaders in sales and technology since 1970s. Once the digital camera made its debut in the early 1990s, global markets changed overnight and Japanese manufacturers shipped more than 20 million units each year. The digital camera changed this market segment instantly and each year it grew exponentially--the IT bubble burst in 2001 had no effect on sales. Some analysts voiced concerns with the addition of digital cameras in cell phones, but the market continued to grow. Total shipments in 2007 reached 100 million units. Digital camera production generated a large demand for electronic components and flexible circuits--more than double the demand from cell phones in Japan.  

But, all good things must come to an end. The global recession that began in 2008 had a negative impact on the digital camera market. From that point on, annual shipments declined 10 to 20% each year and shipments in the latter part of 2012 fell even more. The most recent data suggests a decline in shipments from 30 to 50% compared to the same month last year. The market is shrinking quickly and the reason is very clear: Digital cameras are available in nearly every cell phone and tablet. The cameras in these mobile devices have a better display quality and Internet capability. The end of the standalone camera may be near. 

Japanese camera manufacturers predicted a short shelf life for their digital cameras over the last decade and began seeking alternative business plans. The short-term solution focuses their product lines on high end models aimed at the professional photographer. This product line has higher margins compared to low-cost compact digital cameras. This is the reason for the upswing in average retail prices.

Japanese camera manufacturers expanded their core business over the last 20 years and the digital camera is no longer their strategic product. These companies have no plans to eliminate digital cameras from their product portfolio since they are no longer the main source of revenue. 

Good for them; bad for flex circuit manufacturers. Since 1970, the camera industry has been the main source of business for Japanese flex circuit manufacturers. Unfortunately, it is not easy to find an alternative source of income for this group.   

Every product experiences an evolution. This is not the last generation of digital cameras. A new, improved smaller, faster, lighter, all-in-one, less expensive, easier to use, voice activated, foldable, waterproof, edible (?), digital camera will be available in stores soon.    

Dominique K. Numakura, dnumakura@dknresearch.com DKN Research, www.dknresearchllc.com

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Headlines of the Week

(Please contact haverhill@dknreseach.com for further information on the news.)1. Elner (Major device manufacturer in Japan) 9/5The manufacturer has invested 300 million yen to expand its aluminum capacitor manufacturing capacity in Thailand.

2. Samsung Electronics (Major electronics company in Korea) 9/4The company has released a new watch-type device, “GALAXY Gear,” with a 1.9 million pixel display and camera. The device communicates with a smart phone and tablet PC.

3. Taiyo Yuden (Major device manufacturer in Japan) 9/5The manufacturer has commercialized a new metallic power inductor series, “MCOIL Series,” with high reliability for automobile and telecommunication applications.

4. Tohoku University (Japan) 9/5The university has developed a new magnetic stainless steel as the electromagnetic valve for fuel cell modules.

5. Toshiba Medical (Major medical equipment supplier in Japan) 9/5The supplier has commercialized a new 3D display as an optional display device for X-ray CT scanners.

6. Ricoh (Major electronics company in Japan) 9/5The company unveiled a new digital camera, “Ricoh Theta,” at IFA 2013. The camera is capable of producing a 360-degree full panoramic view.

7. Panasonic (Major electronics company in Japan) 9/6The company has rolled out a new 20” tablet PC, “UT-MB5,” with a 4k IPSa LCD panel for business use.

8. ASE and SPIL (Major semiconductor packaging firms in Taiwan) 9/6Both firms have increased shipments in the second quarter, up nearly 10% from the first quarter. Each firm has an optimistic forecast for the third quarter of 2013.

9. Hamamatsu Photonics (Major optical device supplier in Japan) 9/10The supplier has commercialized a new portable (1.9 kg) Compton Camera for gamma ray detection with high 2D resolution and high sensitivity.

10. E Ink (Major e-paper supplier in Taiwan) 9/10The supplier has begun volume production of the next generation e-paper display “E Ink Carta” featuring higher contrast and smooth paging.

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