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Analyst Angle: Note to Canon and Nikon – Look over your shoulder, smartphone cameras may be sneaking up on you

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“The iPhone 4 camera is easy to use, has great auto-focus and HDR capabilities and lots of ways to easily post my photos to the Web. And, I get resident services such as Apple’s upcoming iCloud service platform – no DSLR can do that.”
–Jason Purdy, Associated Press Mobile Group

Every time I use my iPhone or BlackBerry smartphone to take a photo, I think of all the high-end digital SLR cameras that Canon, Nikon and others make. The digital SLR cameras have interchangeable lenses that take amazing digital photos. This is due to two things: 1) bigger lenses; and 2) bigger and better image capture chips. On the low end, each of these companies makes “point-and-shoot” pocket cameras that take very good photos and provide tremendous portability and convenience.
I suspect many of you have a digital camera likely from Canon or Nikon. It’s probably either a point-and-shoot pocket camera or a digital SLR. DSLR cameras are typically used by professional photographers or by consumers at important lifetime events like weddings (where carrying around a bulkier and heavier DSLR is justified).
While you may have a digital camera, it is probably sitting on a shelf gathering dust. I’m finding that more people are choosing to take a photo using their smartphone rather than carrying around a separate point-and-shoot pocket camera. It all comes does to convenience vs. fidelity. You have the convenience of a “pretty good” digital camera in your smartphone vs. the higher fidelity in a separate point-and-shoot camera.
Now, camera phones are getting a lot better. They now typically include adequate megapixels, flash, auto focus, zoom and red eye correction. The fact is that cameras in smartphones are good enough for most situations. Thus, they are winning the convenience over fidelity war. Sure, point-and-shoot pocket cameras are still selling well because they have a little better fidelity than smartphone cameras. And they are still important for people who don’t own a smartphone.
Over time, as smartphone cameras get better, the difference between the smartphone camera and point-and-shoot pocket camera will get become even less pronounced. At the other end of the spectrum, DSLRs are getting more features including being able to take full high-definition video. As this happens, Canon and Nikon point-and-shoot digital pocket cameras are going to get squeezed out of the market. Users will either migrate to using a smartphone camera or DSLR (or both) but not use a point-and-shoot pocket camera. This will take a few years, but it seems destined to happen.
Both Canon and Nikon should look over their shoulders: the smartphone camera is gaining on them. So, here’s my primary message: Canon and Nikon (and other major majors of point-and-shoot cameras) should get on board the train before it leaves the station. They should be partnering with smartphone vendors to provide better optics, better imaging chips, more intelligence and ways to help make the smartphone camera just as good as the best point-and-shoot cameras are today.
I can see it now: “Buy the new iPhone 6 with the wiz-bang optics and image management by Canon.”

J. Gerry Purdy, Ph.D. is Principal Analyst, Mobile & Wireless at MobileTrax L.L.C. As a nationally recognized industry authority, he focuses on monitoring and analyzing emerging trends, technologies and market behavior in the mobile computing and wireless data communications industry in North America. Dr. Purdy is an “edge of network” analyst looking at devices, applications and services as well as wireless connectivity to those devices.

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