Redwoods versus Banyans: CE Companies Thrive in the Digital Imaging Ecosystem

Redwoods versus Banyans: CE Companies Thrive in the Digital Imaging Ecosystem

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Two types of giants dominate the digital imaging ecosystem. Nikon, Canon and Fujifilm are like towering redwoods, growing straight toward the sky from deep roots in imaging and optics. Sony, Samsung and Panasonic are more like spreading banyan trees, complex growths with vast root systems that draw nutrients from all over the map, that are constantly branching out in unexpected directions.

As digital imaging enters a new era of connectivity, ubiquity and market saturation, the banyan trees may well enjoy evolutionary advantages over the stately redwoods.

“The camera industry is still growing outside the U.S. and Western Europe,” says Ed Lee, Consumer Imaging director at InfoTrends, “but in North America, we’ve reached saturation. It’s a replacement scenario now. And it’s hard to get people to go out and replace that old camera because new models are more evolutionary than revolutionary. The Canons and Nikons are perceived as technology leaders, but Sony is actually more innovative in coming out with different feature sets. The same for Panasonic and Samsung; they’re out there trying different things.”

A Generational Change Is Coming
Lee believes connectivity is the industry’s future. “Our message to camera makers is they’ve got to get their products connected or they’ll lose the overall battle to smartphones and cameraphones. In our 2011 survey, 36% said they use their cameraphone more often than their traditional camera. That’s a 300% increase since 2008, and it’s even higher among younger consumers 18–29. A generational change is coming through the pipeline.”

Part of that change is a shift in how younger consumers define a good image. “We’ve talked about image quality, preservation and management,” says Lee. “But today’s consumer is really most interested in retrieval: ‘I just want my photo when I want it, whatever device I’m using and wherever I happen to be.’ They’ll settle for good enough quality if it comes with lots of convenience, including sharing. With smartphones or connected devices, they can instantly send pictures or videos to friends and family, making them part of the moment. They don’t care what happens in the background. The challenge is putting together the right ecosystem for that connected experience.”

In parallel with the small screen of the smartphone, the huge screen of the HDTV has emerged as a central hub of connected imaging, whether it’s through HDMI ports, card slots, Blu-ray or connection to Internet sites such as Flicker or Picasa. “HDTV enhances the viewing experience because it’s the largest screen in the household,” explains Lee. “Twenty percent of people watched some of their photos on TV in 2011. That’s a big jump, and it occurred because images look much better in HD than on standard TVs.”

In contrast to traditional camera makers who may lose mass-market share as imaging advances into the ether, Sony, Samsung and Panasonic seem perfectly positioned to prosper whichever way the market moves—and to cross-pollinate devices to create new hybrids and marvels of connected imaging. We spoke to all three of these prime movers on the eve of CES to see how the future of the imaging ecosystem looks from their angle.

Sony: The Magic Is in How You Connect It
Sony Electronics is so diversified that neither “imaging” nor “consumer electronics” can begin to describe the full scope of its business. According to Brennan Mullin, senior vice president of Personal Imaging & Audio, “Sony is an entertainment company. That entertainment comes in many forms: commercial content such as music and films; gaming on the electronics side; Walkman, headphones and car stereo in personal audio . . .” Not to mention Bravia TVs, video equipment ranging from pro to Handycam, and still cameras in which Sony now ranks #3 behind only Nikon and Canon. “The magic is in how you connect it,” says Mullin. “At heart, our business is delighting consumers with fun and cutting-edge entertainment.”

Sony’s imaging products are built on three pillars: the core sensor (many kinds for many different products); the Bionz processor; and the optics. “One of our core strategies is to give you the best from each of the three big categories. That helps us innovate and think differently,” adds Mullin. “It gives us an advantage in developing new feature sets such as Sweep Panorama, which takes something that was limited to video and applies it to still photography. From the audio side, we have a rich history in 5.1 surround sound, so we incorporate that into our latest camcorder, the VG20, which also offers interchangeable lenses. Sony makes pro video cameras that capture 3D, so we’re bringing that technology to consumer camcorders. Now you can capture meaningful personal content in 3D and 5.1 audio, play it all back on your Bravia TV, and enjoy home movies that are a lot closer to commercial films.”

Borrowing from the TV side of the company, Sony adapted OLED display technology to use in electronic viewfinders for still cameras. “EVFs were considered inferior to optical viewfinders,” notes Mullin. “OLED is ultrathin. It lets us make viewfinders that are sharp, vivid and incredibly quick. We use it in our Alpha 77 and NEX-7 cameras. You can adjust exposure on the fly, see instant feedback, and what you see is what you get. In frame coverage and speed, OLED exceeds some of the best optical viewfinders.”

Mullin calls Sony a “holistic” company that takes full advantage of its technological diversity. “Having expertise from pro to consumer level gives us more flexibility. We’re able to draw from our rich base of imaging technologies and intellectual property, to pull ingredients from across the company and create meaningful connections that consumers want. Innovations are nothing unless they make life more fun and entertaining.”

Samsung: A World Leader In Every Technology Relevant to Connected Imaging
Samsung may not be able to match Sony when it comes to flair. But when it comes to creating the connected cameras of the future, Samsung is a formidable competitor—a world leader in virtually every relevant technology and device category. Samsung is first in worldwide sales of flat-panel TVs, LCDs, memory chips, LED displays and OLED displays. Its 3D lineup includes 3D TVs, 3D Blu-ray, 3D content and 3D glasses. In digital cameras, Samsung currently ranks in the middle of the top 10, but it has demonstrated a drive to innovate its way to the top with the launch of its 3D compacts and mirrorless, interchangeable-lens cameras.

According to Reid Sullivan, Samsung Electronics America’s senior vice president for Mobile Entertainment, the company is gearing up for the age of seamless, interconnected imaging. “The current trend from consumers clearly shows a shift from traditional uses of digital imaging products to more connected products that enable them to be more creative and share content more seamlessly in a variety of ways. As more consumers recognize the value and convenience of the mobile lifestyle, these content-sharing experiences are expanding from the living room to any location. We are working to make the entire process simple and intuitive.”

In an enterprise as huge as Samsung, it takes some work to facilitate the free flow of ideas across divisions, but Samsung has already had success. “We have already started sharing technologies,” says Sullivan. “Some of last year’s digital imaging products integrated wireless capabilities or the tactile response of a capacitive touch screen and app-style user interface like the ones used in our smartphones. We also started integrating 3D into digital cameras. The MV800 includes a 3D mode that transforms any image (including panoramics) into 3D.”

Samsung also sees the SmartTV as the hub of home entertainment and an ideal vehicle for sharing content. “However, we aren’t focused entirely on connectivity with the TV,” explains Sullivan. “We are continually looking into the link between the camera and the smartphone, as in our Remote Viewfinder application that turns a Samsung phone into a second screen and wireless remote control for the SH100 wireless camera; or the link between the camera and the computer, as in our PC Auto Backup feature. Samsung has also integrated content-sharing features into the Galaxy Tab line. Connectivity is critical to the consumer, and that is reflected in our product portfolio at CES this year.”

Panasonic: The Technologies and Determination to Be a Major Player in Connected Imaging
Panasonic may not have the massive size of Samsung or the glamorous track record of Sony, but it is a powerfully diversified consumer electronics leader that currently ranks sixth in digital camera sales and has an especially strong presence in the new mirrorless and Micro Four Thirds categories. Ranking among the 100 largest companies in the world, Panasonic is in the top 20 for semiconductor sales, a world leader in 3D and plasma TVs, and first in the business telephone market. Panasonic clearly has the technologies and the ambition to be a major player in connected imaging.

The company believes that HDTVs are the key hub for connected imaging. “Forty percent of all TVs sold today are SmartTVs that can be easily connected to picture-sharing sites such as Flicker or Picasa,” says Stefan Guelpen, Panasonic Consumer Electronics’ vice president of Imaging, Sales & Merchandising. “That’s going to make TV the main medium to watch or share pictures or videos, which I think is dynamite because it’s a much bigger, better screen, particularly for video but also for stills. You don’t even have to connect hardware anymore. Even if I go to your house, I can hook into my Picasa account and watch my pictures on your TV. That’s important. It’s going to change the way you look at pictures. As an imaging guy, I’m excited.”

Guelpen admits that it will take changes, especially on the retail level, before consumers realize how much that SmartTV can improve their imaging experience. “In retail stores, you have separate departments for home entertainment and imaging. So to cross that bridge at a retail level is a little more complex than we would like it to be. Look at Best Buy. You can’t just pick up a camera and walk over to home entertainment area and put the SD card in a Panasonic TV, but going forward, that will change.”

As it gears up for CES, Panasonic is stressing two themes: Eco and Smart. “Everything becomes more environmentally friendly and everything becomes smarter, with better connectivity, more cloud-based services, faster Wi-Fi and streaming,” says Guelpen.

Panasonic will also highlight 3D. “Most cameras and camcorders will have 3D capture modes,” he adds. “TV has been a fairly expensive barrier of entry to watching 3D, but that’s changing. Today 20% of TVs sold are 3D capable. I love photography, but shooting in 3D is a whole new experience. You have to see and think differently. At CES, we’re going to offer some fun and exciting seminars about how to shoot and share in 3D.” 

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