"Time for a Change at Canon?" -Barons

[ScottyP]

Rather scathing article in Barron's financial about Canon.

http://online.barrons.com/article/SB50001424053111904184504577518750120947294.html?ru=&mod=barrons_msnhttp://online.barrons.com/article/SB50001424053111904184504577518750120947294.html?

 

[awinphoto]

Rather scathing article in Barron's financial about Canon.

http://online.barrons.com/article/SB50001424053111904184504577518750120947294.html?ru=&mod=barrons_msnhttp://online.barrons.com/article/SB50001424053111904184504577518750120947294.html?

So they are upset that the president of the company in 1996-2006, (when canon ruled the digital world and was on top of the game), is now back in control? He helped canon get out of the struggling Film SLR market where they were seen as second violin to Nikon, and kicked Nikons butt in every category in digital photography for a solid decade... Of course, 2007 to present is when most view canon's fall to nikon... So perhaps it's not a bad move... of course everyone would love to see new blood and ideas and innovation, but if he gets canon back on track, who's to argue?

 

[distant.star]

.
I'd hardly call that "scathing."

It's critical of a company that has a 76-year-old man running the show.

Canon faces a lot of tough challenges, no secret there. I don't see them being in any kind of trouble.

 

[risc32]

I didn't bother to read it, but if the guy who manned the ship from 96-02 is back, nikon headquarters at large probably soiled themselves at that news. As Awinphoto said and unless you where around back then you just might not fully understand how much Canon OWNED nikon, and the rest of the field really. Nikons offerings were very far behind the curve for a long time. I know it's larger than one man, and for all I know this guy wasn't the driving force behind Canon's innovations, but maybe...

 

[Martin]

Great, maybe we will have an opportunity to experience some really new cameras and sensors in future. Old guy, old stuff, no real develop and research. Hope a new president will look a bit around and see what competition brings to the market. Canon definetely need some fresh ideas or just new sensors built with up to date technology. On the other hand, is there better manufacturer than sony in terms of sensors? There is a need for a new technology process for canon, otherwise in next two cameras generation the wiill loose a lot of market share. It could be be a shame with such a good optics. Keep my fingers crossed for changes. Hope the new guy will lead the company to the top.

 

[DJL329]

Also note that News Corp acquired Barrons when they purchased Dow Jones a few years back, so take it with a grain of salt. Or two.

 

[Mt Spokane Photography]

What I read is just as I imagined it. A totally inside board of directors each congratualating and re-electing themselves and totally oblivious to the world around them and its changes.
They badly need some outside directors to push for change. The continued lack of agressively priced and specified new products is going to put them in a hole that becomes increasingly difficult to pull out of.
Being on top today does not guarantee being on top tomorrow, particularly when other companies are catching up and even passing you. One day soon, they will be wondering what hit them.

 

[canon816]

Wow... A bunch of whining here. Canon produces camera after camera that continues to push ISO quality and resolution at the same time while packing them with mind blowing features like 6, 10, 14FPS!!! Do you pixel peepers even use your cameras anymore?

Reality check... All camera manufacturers are producing products and technology that consistently beats the generation before. P&S cameras can take awesome quality photos and entry level dSLR cameras blow what was once considered professional grade out of the water.

It really wasn't that long ago that digital, autofocus, image stabilization, solid state, processors etc... didn't even exist.

Maybe I'm the only one that is amazed every time I go out and shoot. Amazed at how fast my camera locks on to a moving target, amazed at how clean images look at ISO 1600, 3200 and 6400, amazed at how large I can print and the color and detail contained.

And... amazed at how much fun I get out of photography. I hope Canon, Nikon, et Al continue to innovate over the next 20 years at least as fast as they have been innovating over the last 20 years....

 

[kdsand]

Well I guess I'm very young compared to him .

I would think at this management level its not about being teck savvy but it is about being a great leader. Knowing who to trust and knowing who to push, how hard & far.
Besides the games still the same
I know some people in their 70s that are quit sharp so power to him.

 

[Wilmark]

To bring Canon back to the top this is what they have to do in the next couple of years.

• Place less reliance on point and shoot (phones will dominate that space.
  Less reliance on Japanese Manufacturing and labour costs.

• Develop new sensor technologies very aggressively or outsource them - this is big for their DLSR line that is running out of steam.

• Improve customer satisfaction - especially the professional space, alot of people have been pissed off at them in the past year. They need to fix this.

• Develop alternate products. Maybe think about a couple of hybrid products. Maybe even develop technologies that could be sold in other branded phones. Cameras in phones suck big time.

 

[LostArk]

Things Nikon has going for it IMHO:

- Illuminated AF-C point :-X
- Spot metering from any AF point
- 3D AF tracking
- Optional round eyecups
- 14-24mm f/2.8
- 28mm f/1.8
- D800 (for now)

Things Canon has going for it:

- 17mm TSE
- 70-200's
- Super Tele's
- ??

Nikon beating Canon, Canon beating Nikon... It's all just part of the natural ebb and flow of the universe. I shoot Canon because when I went to buy a camera the equivalent Nikon was out of stock. Plus I find spinning the wheel on the back in circles to be therapeutic. If they ever got rid of the spinny wheel I might have an existential crisis.

 

[dafrank]

I'm not a chairman of the board of a major Japanese corporation, but I did stay at a Holiday Inn Express last night. That qualifies me as much as anyone else here to comment on this stuff.

There's probably a little "ageism" going on here in some quarters. The Japanese wisely respect the wisdom that only comes with age to those who are open to learning from their experience. This gentleman certainly is not a fool, judging from his past performance. I see nothing wrong with him taking control right now. Perhaps if he were 86, not 76, there would be a real question of his physical capabilities; if he is healthy, he will most likely do very well for Canon for some years to come. The clues to what must be done are not just available to those whose credentials are mainly that they have less experience. Sometimes, younger people have new and valuable insights based on not being wed to today's orthodoxy, sometimes not, and those younger people who do have valuable ideas can submit their insights to older peers who can most likely best evaluate their efficacy. I doubt that Steve Jobs came up with the idea for the iPad, but he probably grasped that it would be a great product when it was presented to him.

As to specifically what Canon does need to do, there have been some good suggestions in this thread already. Furthermore, I would offer that, generally, they should avoid trying to match Nikon, Sony, et al, but try to come up with truly new ideas, totally new technology that either leapfrogs their competition or entirely changes the paradigm. Examples would be something like an effective true color sensor that avoids the pitfalls of Sigma's Foveon design (low overall sensitiviity and poor SNR at higher ISO's, complex manufacturing and less than great color response because of uneven absorbtion rates of the medium in which the sensors are embedded ), new original technology to increase DR and resolution per sensor area without the usual negatives, new marketing areas for the application of their technologies to increase business opportunities, and, finally, a rationalization of their manufacturing to include the outsourcing of the best and cheapest comnponents from other manufacturers.

That's enough babbling from me, folks.

Regards,
David

 

[thebowtie]

I'm not a chairman of the board of a major Japanese corporation, but I did stay at a Holiday Inn Express last night. That qualifies me as much as anyone else here to comment on this stuff.

+1e6

Unless you are a significant stock-holder (like a pension / superannuation fund), or a senior executive of Canon, it would be hard to provide a qualified opinion of what the qualities of individuals in leadership roles of Canon should be.

I have posted before, that if you are unhappy with Canon's offerings, you should not whinge about them, rather, do not buy them.

Vote with you wallet! It's by far the most effective management and strategy tool in the market.

 

[unfocused]

Two things jumped out at me.

1) Earlier this year, in its conference call to investors, Canon outlined how seriously in trouble its office machines division is. They readily acknowledged that profits from the camera division were being used to offset losses in office equipment. Copier sales were down, in part because of the worldwide recession, causing businesses to delay and/or reduce purchases of office copiers and other equipment. This article confirms that the problem is in office equipment sales. People on this forum think it's all about cameras and about new photography gizmos. But, that's not where the problem has been for Canon.

2) What investors are looking for is seldom what customers are looking for. It's pretty clear from this article that investors want someone to come in and cut costs and maximize profits. Chairman Mitarai sounds like an old-fashioned sort of business executive who believes that producing a quality product and outperforming your competitors is the best formula for long-term success. Frankly, I much prefer that approach to the short-term, quick-profit, reduce investment approach so popular among large corporations today.
As a consumer of Canon products, Chairman Mitarai sounds like exactly the kind of executive I want in charge of the company.

If I were a short-term investor interested in making a quick profit on the stock, and with no real investment in the product line itself, I might agree with Mr. Martin of Barrons. But, as a consumer, I cringe at the thought of what would happen to Canon products if they brought in a team of young hotshots as proposed by Barrons.

 

[Jotho]

Difficult to say what they should do although the real game changers are often things that we as consumers didn't even know we needed or wanted until they came out. ipad as an example, that idea was already old and products were launched years before Apple 'came up' with the idea. They however offered it in a very tasteful package and (most importantly) as an integrated part of a system. That is a strength that Canon holds with its EOS-system, but it would probably need to contain more different products and features, specifically around inter-connectivity, internet connectivity etc.

I don't think Canon's future depends solely on a new lens or a cooler sensor (although we would like it very much on this forum), we know very little on where Canon makes money and where they need to move to make more money, we get clues in the article on the high margin areas that they need to move to and what areas they need to improve in such as printers and copiers. BUT, these are American analysts speaking and Japanese tend to run their companies their own ways which has proven very effective. They will think their own way on this.

I would hope that they saw a way to work the P&S market so they could meet the threat coming from phones. Maybe just moving away from it is what they need to do, they could never be successful in start making a phone of their own. Also proven already is that phone buyers don't care about image quality or brand names (remember when SonyEricsson sold phones branded Cyber Shot).

Let's just hope for the best and that they stay long term focused ;D

 

[mchubi]

Well, some people will call this a "blasphemie". But if Canon could adapt Nokias pureview technology (http://i.nokia.com/blob/view/-/849564/data/2/-/Download1.pdf) to increase image-quality, especially high-iso would get quite a leap. Yes, first I thought "41mp cam in a smartphone. They're gone nuts!". But if you look at the taken images, well, at least in the p+s segment Canon could set up new fires.

 

[paul13walnut5]

@awinphoto

So they are upset that the president of the company in 1996-2006, (when canon ruled the digital world and was on top of the game)

He helped canon get out of the struggling Film SLR market where they were seen as second violin to Nikon

Of course, 2007 to present is when most view canon's fall to nikon

Directly contradictory post there...

 

[kdsand]

My esteemed colleagues I would like to thank you for all the valuable insight offered thus far.....


Any whooo. :

I totally agree - go rob a bank if you want short term pay out. An executive should be compensated based on long term performance for crying out loud even regular employees have to go years to gain modest benifits such as being vested or being able to retire with a pension. Bring back some soul to business, pride in branding & reliability.

Certain markets are seemingly fairly predictable such as DSLR's and optics, though they seem to have been coasting by in the last several years. For example the 7D has been known as a great solid tool for years now so figure with how long the r&d & development took - its inception could potentially trace back around ten years. In the last several years the rebels & 60D have in a sense been offshoots of the 7D. I'm not so sure the 5DIII can claim a rock solid title but canon sure needs something to do so.

As far as cell phones vs point & shoots
Dont even try to compeat. Give people access with their cell phones & tablets to their cameras. Heck leave the screen off the camera for all I care I'm rubbing my nose against it anyway. I like and need a nice screen but I already carry several anyway. Imagine having the new M linked wireless to your phone then you would have room for a view finder. Regardless cell phones & tablets will soon be linked to our cameras. Its already happening.

If other Canon divisions are floundering I doubt they dare rock the boat much in the consumer optical arena but they can't stagnate and loose much more ground to Nikon either. It will be interesting.

2¢ here and 2¢ there.

 

[4D]

He has a tough task ahead. Some financial insight from Bloomberg news:

"Canon Inc., the world's largest camera maker, plunged the most in more than three years in Tokyo after cutting its full-year profit forecast because of a stronger yen and expectations for weaker global growth.The shares declined 7.8 percent to close at 2,470 yen, the most since November 2008.

The company kept the sales target for single-lens reflex cameras, used by professionals, unchanged at 9.2 million units. Appreciating YenThe maker of EOS models said earlier this week the company is introducing its first mirrorless model in September, joining Nikon Corp. in tapping growing demand for lightweight cameras with interchangeable lenses.

“Even as the worsening macro economy and a stronger yen were expected to damage Canon's earnings, an intensifying competition in laser printers was unexpected,” Tetsuya Wadaki, an analyst at Nomura Securities Co., said in a report yesterday. It was also a surprise that sales estimates weren't improved after a new mirrorless camera model was unveiled on July 23, he said."

 

[Canon-F1]

Less reliance on Japanese Manufacturing and labour costs.

as long as he will not outsource everything to crappy china im ok with a 70+ chairman.

outsourcing camera production to china would be a moronic thing to do.
china has no real digital camera producion yet.. but that would change very fast.

china steals every idea and comes up with a cost reduced cheaper product.
they build a factory to produce outsourced stuff for you and 500m away they build a second factory to copy your ideas.

the end result you can see when looking at studio strobes and studio accessories.
a zillion of cheap clones.
not bad for the customers at first sight.. but sure bad for the companys who outsourced to china....