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Tuesday, 14 February 2017


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Over many years, Nikon lost a lot of pros to Canon. I dumped my Nikons for Canon's early on when their unreliable "auto-focus" system failed too many times on important gigs. At that point,in my opinion, Nikon started to neglect the professionals who built their reputation in favor of a more profitable prosumer (hate that word) market.

When I was starting out, my dream camera was the Nikon F2. I eventually owned a beat up second hand one. Built like a tank, just like the A1 lenses I used for 30 odd years.

The best camera I ever owned was the 801 that I used and mistreated for my theatrical photography. I got 10 or more years heavy use out of the two bodies I owned.

Then came the F100 who's plastic grips became sticky after a very few years.

Things went better with the D70 which went to a new home after a couple of years

The rubber rings on my 17-55 2.8 "Pro Grade" lens that expanded and had to be replaced after a couple of years

I bought the "semi professional" D300 which I still have with peeling plastic grips. Basically it is unsellable.

The D300 was the end of the line for me with Nikon. I felt the quality had gone out of Nikon products.

I have a couple of Olympus EM5's and some Panasonic lenses. After heavy use the plastic on the EM5's is not peeling off and the focus rings on the two 2.8 Panasonic zooms are still perfect. They hike with me all over the Italian Apennines.

My LX100 apart from the bigger sensor has something fatally lacking from two of the Nikon DL's:an EVF. With an EVF they could have been interesting for those of us with over 50 eyesight.

Nikon are in a terrible place now. Clearly second to Canon in DSLR (in fact all ILCs). They releasing low end DSLRs with minor tweaks, quietly killing the Nikon 1 and dumping the last chance of some product vision in the DL.

The Nikon DL range seemed like the one place Nikon might actually make a product that a few people are looking forward to especially the unique DL 18-50 (mm eq -- so ultra wide to short tele). This could please a range of customers not otherwise served who need a compact wide-angle camera. This one was not "Sony-clony".

As Thom has mentioned you could even imagine a "DL with a CX mount" coming along for the ride to bolster the Nikon 1 range especially as they've done all the engineering work for a platform for three cameras adding one more would be a tweak.

Perhaps their next marketing phrase in the "I AM" series (yes, they do it in ALL CAPS like your grandad) might be I AM SCREWED. After all their marketing strap line for the DL range was "I AM EXCELLENT 24/7". They clearly aren't.

The Nikon Rumors comments are very interesting too. Thom often appears in the comments.


These reports can be really hard to parse. Just a couple of notes:

Nikon's net loss over the period they are talking about (nine months ending Dec. 31, 2016) was 831m yen, or about 7.5 million dollars. The "extraordinary loss", which basically means out-of-the-ordinary loss or expense, was 29.7b yen (about 270 million dollars) but that was offset by operating profits (likely all in cameras) over that same period, and the end result is an 831m yen net loss. And the 29.7b yen "extraordinary loss" was not in the camera division; it was in the semiconductor lithography division (inventory write-downs).

Also, the lithography division write-down of 29.7b yen accounts for the majority of the 53b yen "restructuring costs" Nikon expects to incur this fiscal year (ending March 31, 2017).

Nikon is now forecasting a 9,000m yen (that's "nine-thousand million yen") net loss for fiscal 2017, or about 81 million dollars on 750,000m yen (6.8 billion dollars) in sales. That's about a 1.2% net loss. Not good, for sure, but Nikon's very strong balance sheet can easily handle a small loss like that. Nikon has been nicely profitable for the past six years (in both cameras and, to a lesser extent, lithography equipment), thus the strong balance sheet.

Nikon does have long-term challenges in a shrinking camera market, no doubt. And the whole DL fiasco is, well, a fiasco. Just terrible business performance. And not the only bad show from Nikon recently. But it's important to keep things in perspective. Nikon is financially strong; it is coming off many years of making lots and lots of money (unlike nearly all other camera companies besides Canon); and there is time to adjust. Their real need is not to be smarter about the camera business; their real need is to find a new business that has scale and is also reliably profitable, to go along with cameras and (maybe) lithography equipment.

And Thom follows up with his view of Nikon's Q3 financials (and of the problem with Nikon's products and how Canon is winning).


So before moving on, let me summarize: Nikon is still decently profitable, but shrinking. The extraordinary loss might be a one-time thing that allows them to stabilize at that smaller size, they might continue to shrink slightly. Everyone worrying that Nikon is going away soon or will be acquired or will stop making cameras should settle down and relax a bit. Things are not dire.

One further note to keep in mind: with the lithography division writing off 29.7b yen in inventory (29.7b yen is 29,700 million yen), and the company forecasting "only" a 9b (9,000m) yen loss overall, it's essentially certain that the camera division will be posting an operating profit for the year. It's the lithography division that will drag the company into an overall net loss.

So if you're analyzing Nikon, the really urgent question is not about cameras at all. The question is what's wrong with the lithography division, and how can they fix it? (That question goes back a long ways; Nikon's first loss-making year ever in its history was in 1992 (talk about hand-wringing!). And the cause was -- yep, huge inventory write-downs in the lithography division. Everything old ...

If, after all this time, Nikon bows out, will anyone care? After all, any firm is necessarily required to meet the market. There's a lot of gear out there that needs support, but there suppliers will fill this need.

I haven't used a Nikon since the last century. When I decided to switch to autofocus in the 90's, Canon was king so I packed away my beat up manual Nikon gear and went the Fantastic Plastic route. Yet I've always revered Nikon. My first "real" camera was a Mamiya-Sekor but I only owned it about six months before selling it to buy my first Nikon Photomic FTn. I decided to get serious about this photography stuff and what better way to get serious than to own a Nikon. Several more Nikons followed and, with them, a couple of newspaper jobs where I managed to destroy or wear out one or two of those Nikon "hockey pucks". Sometimes I think the only thing I'm really good at doing is breaking things.

I suspect Nikon will survive the current crisis in one form or another. They make excellent products and I certainly wish them the best. Keeping ahead of the trends is tricky work.

As a Nikon customer, this is very frustrating. I don't know much about the technical side cameras. But I use them a lot - currently a D5, D500, Olympus EM1 and the occasional Nikon V2. When the M43 matured to the EM1, it was clear that the EVF was ready for primetime.

When talking with people two and three years ago, I would comment that Nikon and Canon are digging their heels in to protect their respective SLR mounts and lens lines. It was very clear that although all of the mirrorless cameras were flawed relative to DSLRs in some areas like continuous autofocus, this was where we were headed. The advantages of mirrorless are too abundant. My prediction was that if these two companies weren't willing to cannibalize those mounts with a professional mirrorless line, they become Kodak and Polaroid.

As of today I still consider the Nikons to be my day to day workhorses. But the inflection point is near. I want a mirrorless D6 equiv that is the size of the D500 and I see absolutely no rational reason why this camera shouldn't exist.

Which companies are actually still making money in the camera business? Olympus, last I heard, was losing money on cameras but making up for it in their medical equipment business. Now we learn that Nikon is bleeding. Is Canon doing better? Sony? Fuji? Ricoh?

This is all pretty sad, they are becoming a formerly great camera company that has, for inexplicable reasons refused to listen to its customers. It has kept trying to repeat its previous successes without realizing that the camera world is changing and doing the same thing over and over no longer guarantees success. They need to take a chance and produce a serious mirrorless camera or at the very least make a usable EVF camera, or both. The big, heavy complex DSLR is rapidly becoming the buggy whip of cameras. This was obvious to Sony, Fuji, Olympus, and Panasonic. I was a Nikon user for 50 years and now am selling the last of my Nikon gear. I hope as this news gets out that I'll still be able to find buyers. Of course Nikon cameras still make fabulous images, that won't change, but it's not at all clear people will continue buying them.

Nikon's only real long term hope is to become the SLR equivalent of Leica in Rangefinders. If they keep making the F6 & the Df and similar types of overpriced cameras to sell with equally overpriced lenses to hipsters? That's the only niche I can see working for them in the long run.

Many people love steam locomotives but electric locos took over.
Fast super cars are well liked but smooth, easy to drive SUV's are more popular and self driving cars are likely to take over much sooner than people expect.
Lovely SLR's are marvelous but the market is dominated by the mobile phone. The traditional manufacturers make wide ranges of cameras and it is hard to differentiate them. They are trying to meet in detail everybody's needs but they just cause confusion.
It seems inevitable that the market will narrow down to a few professional level cameras while at the same time the mobile phone cameras will move up and up. The pro cameras will go up and up in price, fewer people will want them or be able to afford them and they could go out of business.
Some niche market possibilities might appear.
Will Leica survive?

You are an enthusiast. Like many enthusiasts, especially those with no manufacturing experience, you often confuse what you like, or would like, and the words coming from other enthusiasts as being strongly related to camera company success.

To you, and me, with my enthusiast hat on, a great company is one that makes interesting, innovative gear. Both gear that's fun to talk about and fun to use.

By that measure, Olympus, Panasonic, Sony Fuji and [insert your fave here.] are the leading camera companies. From my viewpoint, Olympus leads, because it has introduced entirely new capabilities far more than the others in recent years. As these are abilities that don't much impact the kind of photography you do, I think you undervalue them. IBIS, HR Mode, Focus Bracketing and so on, have deeply changed what I can do as a Photographer. They've granted wishes I've had since I was a teenager, mucking about in the school darkroom. So, I've got Oly and Panny gear, and an A7, but I don't fool myself that there is any correlation between my tastes and camera company success

To me, with my financial analyst hat on, a great company is one that makes very few money losing and many money making products. By this measure, Canon is a great company, best in its industry.

My hope is that the small companies with innovative gear do well enough to survive.

You deeply misunderstand the economics of manufacturing. As do so many other industry pundits and folks posting on line. The Nikon troubles, perhaps disaster, was entirely predictable from reports of their declining sales. Lay people tend to think that a 30% decline is sales will mean a 30% decline in profits. It's more likely that a 10% decline in sales will mean a 90% decline in profits. A 20% decline will generally mean massive losses.

I could go on for pages explaining why this is so, and have, elsewhere. Suffice it to say that details will vary by company and industry, but are much like the above.

You've talked about Sony's FF mirrorless success. What you and I don't know is if they are actually making any money at it. It's a mind space success among enthusiasts, but that is unrelated to financial success.

[Sounds like your two hats are arguing with each other. I only wear my enthusiast hat here--I only care about photography enthusiasts and their/our interests and needs. Tangentially, I want companies to make what we care about and I want those companies to survive--of course--Contax and Bronica aren't much use to us now--but fundamentally I am uninterested in "financial success" in isolation.

Our perspective is that of photographers. That's why we care that the companies a) make what we want and b) stick around. The same can't be said backwards.

From my perspective, Sony and Fuji ARE more successful camera companies than Nikon right now, because they make products that are more interesting and useful to us, and they're innovating more and listening to and responding more to their customers. If they are less successful financially than Nikon, that doesn't mean they are less successful from my perspective. Another way to say this...if Camera Company X figures out how to make zillions of yen selling shoes or soap but stops serving photographers, then it would be a much more successful company, but I would care a lot less about it. --Mike]

A sad moment for all the employees inside and outside Nikon who lost their jobs. And for the architects, interior designers, real estate agents and anyone else in the building business who needed the DL1850 for their work. Fast 18mm equivalent and perspective control. Certainly not a Sony-cloney.

The best source for their situation is probably their financial reports page, here: http://www.nikon.com/about/ir/ir_library/result/#y2017

It doesn't look pretty. Imaging Products have been steadily falling since 2015, from 586b (2015), 520b (2016), to a target of 440b (2017), now revised to 380b. That's a 35% reduction in net sales since 2015 and a 44% reduction in operating income (probably what really matters).

In terms of camera sales (in thousands of units, 2015, 2016, 2017 -- revised target)
- Interchangeable / Bodies: 4610, 4040, 3100
- Interchangeable Lens: 6680, 5900, 4600
- Compacts: 7960, 6230, 3150


Everywhere else they had very ambitious targets for 2017, but they didn't achieve them.

Seem like dire times, but:

1. Write offs are just that; you thought you would make more money in the future, put it into the books, and then in reality you don't achieve that target. So you have to take it out of the books. It's like losing money you never made anyway.

2. They still make great cameras and lenses, but seems like in the future they are going to concentrate on more profitable products. A bit like Sony, that seems to have no problem in selling USD 3500 MILC cameras and USD 2000-3000 FE lenses...

I feel rather bad for Nikon these days. There's no question about the quality of the company's cameras - specifically its DSLRs. But they truly seem to have lost their way in the brave, new world of 21st-century photography.

I used to think the same thing about Canon. But that company obviously had a number of products and technologies in development (even if on the back burner) for a while. Canon simply chose not to introduce them until they were convinced of where the market was headed.

It would be one thing if Nikon simply had problems with the DL, as embarrassing and costly as it is. Frankly, I think they could have solved those issues by switching to a Sony sensor. But it probably doesn't matter. I suspect they are only now realizing what trouble they are in - and still have no idea of how to fix it. They're currently in triage mode.

I spent quite a few years in the financial news business and I agree with Thom Hogan: Nikon very likely is about to become a much smaller company. This doesn't bode well for their long-term survival or, at the very least, their independence. I wonder if the belt-and-suspenders brain trust running the company would have enough sense to entertain an offer from Fuji?

Well, if this story sits uncommented for two days, that's a statement on Nikon's problem. Nobody cares?

I had a very specific use that would probably have led me to buy a DL 18-50. I do a lot of real estate interiors, and nothing makes my flash-and-sunlight style easier than a leaf shutter, for fast flash sync. So what's my other choice- the widest lens available with a leaf shutter?

[Re "uncommented," sorry, that's my fault. I've been behind on comment moderation all week. Always happens when I do more than one post a day. I'm getting to it now. (Wed. 12:42 pm) --Mike]

In photography Nikon largely lost its essence, and its way, a long time ago. Its gotten by on brand equity, marketing, and its engineering chops in traditional pro-level cameras. But the more the industry changes, and the more it's disrupted by new technologies, the faster the earth is pulled out from under the feet of Nikon.

What Nikon needs, in my opinion, is a Jesus figure, a visionary who understands the company's history, and its capabilities, and how those can best be brought to bear on its fast changing industry. In other words, Nikon needs a Steve Jobs.

It's clear from looking at its camera lineup that Nikon has divided the market into as many segments as it can identify, and then attempted to grab as much share as it can from each segment without cannibalizing its other offerings. Such an approach is stuck, conceptually, in the twentieth century.

Right now Nikon offers four lines of compact cameras: "Budget Friendly", "Slim Zoom", "Waterproof/Shockproof", and "Bridge Zoom". There are three different offerings in each of these lines, for a total of twelve compact cameras.

Then there is the Nikon 1 series, consisting of five "everyday" models, one "performance" model, and a lineup of series-specific lenses.

Additionally, there are three cameras comprising the "KeyMission Action Camera" line.

And, lastly, the DSLRs: two APS-C entry-level models; four cameras deemed enthusiast-level, two of them APS-C and two full-frame; and, three pro-level full-frame models. Nine DSLRs in all.

Notably missing among all these lines is a premium compact, that line having been recently axed.

What would Steve Jobs do? He would sideline the marketing department responsible for this nonsense, and rationalize the camera offerings. The compact line is junk. It's yesterday, and a drag on the brand, irrespective of operating margins. To the landfill with it.

The Nikon 1 series is Nikon's answer to a question only Nikon was asking: how do we capitalize on the mirrorless trend without cannibalizing our traditional offerings? Again, off to the landfill.

The "KeyMission" cameras were Nikon's response, delivered late in the day, to the unanticipated success of GoPro. There may be merit in it, but not enough to sustain three different models. The concept is too niche-specific, and nowadays even GoPro is in trouble. In any case, this is the last thing Nikon should be dealing with, until it gets its core business sorted. Put KeyMission on waivers.

How many DSLRs should Nikon offer, and of what type? Does it need two entry-level models? Should both of them be crappy, crippled cameras, full of features almost no one will ever use?

Can Nikon sustain both full-frame and APS-C? Especially since it has never fully developed a lineup of lenses for the latter, even after all these years. Why is the D500 designated as "Enthusiast"? Only because of its APS-C sensor? The Df was touted as a "return to essentials", which made it all the more disappointing when it turned out to be the bastard offspring of a sordid coupling between marketing and the painted whores of upper management. And do we really need, in todays world, the huge and heavy D5, and the 36MP D810?

If Nikon took a rational, performance oriented approach, the lineup might look something like this:

· An entry-level APS-C DSLR featuring fast autofocus, a 100% pentaprism viewfinder, separate dials for aperture and shutter speed, and an articulating LCD. Pentax does this, why can't Nikon?

· The enthusiast-level full-frame D750.

· In the pro category, a full-frame version of the D500, with the option of a power-booster battery grip. If it proved to be infeasable for this combo to offer the same performance specs as the D5, then offer the D5 as well, so that pros could choose between the larger camera and the smaller.

· Also offer, for pros and enthusiasts, a fixed-lens APS-C pocket camera. Since 28mm seems to be the preferred FOV for such cameras, make it 28mm. In other words, bring back the Coolpix A, but this time price it competitively and support it.

· A new line of APS-C mirrorless cameras, one entry-level, one enthusiast-level, and one pro-level. Properly done, Nikon would throw all its technical and engineering prowess at this line, doing everything it can, in terms of design and performance specs, to cannibalize its DSLRs. Cannibalize your own product offerings before someone else does. That's how it works in the 21st century.

Alas, it seems unlikely a Steve Jobs will show up at Nikon headquarters. It seems even less likely Nikon would recognize him, if he did show up. What seems far more likely is that Nikon will go the way of other great companies that lost the plot: Kodak, AT&T, and Konica-Minolta, to name but a few that have lost their magic or died altogether.

The shame of this is that the DL18-50 offered something unique. Something which would have covered most of my city-break focal length needs (I'm an architect so I like shooting buildings, squares and stuff like that) in a handy walk-around package and had made me consider buying a Nikon for the first time since my Coolscan V.

The root cause of Nikon's problem is that they didn't just not listen to their customers, they thumbed their noses at them. This can be traced to their unwillingness to follow up their best selling camera ever, the D300 and (DX lenses), because they apparently felt there was more money in forcing people to FF. A dozen other decisions like this have since characterized management's approach to the business. Compare to Fujifilm for just one company that has taken the opposite approach to customer orientation.

I'm sorry to read this news. I have a fondness for Nikon products because my first "serious" camera was a Nikkormat FTN (purchased in Boston in 1968). It was rugged, and I used it all over the world, followed up with a Nikon F and then a F3. If film is really having a revival, I wonder if re-introducing their gorgeous rangefinder film cameras might be a profitable niche?

I've been shooting Nikon reflex cameras since 1967 and still have--though rarely use--a D 600. I bought a Nikon 1 V2 two years ago and was hoping to buy one of the DL models. When it became obvious last fall that the DLs would never be released I bought an Olympus Pen F and put my N1 body and four lenses on eBay.

I'm sure my story is similar to those of thousands of former Nikon loyalists.

I am not a "bean counter" or a financial whiz but having lived in a corporate world for over 40 years I do know that early retirements are extremely costly to corporations. They are usually not a long term financial fix for troubled companies. Sad news for sure but I do not feel sorry for NIKON, they had it all and just screwed it up. When the V series came out I laughed, is that really the best they could come up with? If they tried to compete with micro 4/3 at the time and joined the format and lens mount when the time was right they would at this point at the least be in "the game". Some really bad corporate long term planning for sure, the so called decision makers should be the ones taking early retirement or maybe they should just be let go.

Well, it is obvious Nikon has some problems. And it is more obvious that they have lost their way to some extent in the minds of many of their customers.(Nice D500. Gotta any good DX lenses for it?)

Although Nikon is going to have to make some adjustments, even if things get much, much worse, it'll still be around and I am pretty sure still be making cameras long into the future. It will be as long as it is a large Japanese company for which when things go all to hell there is always the Japanese taxpayer to rescue them. The only threat the government's willingness to bail out companies goes away.

Neither Nikon nor the government are anywhere near either of those extremes, so I am not too worried about Nikon. I just want to see some #$%&@ lenses.

The price of oil (and dependent products) being down has given the impression that real inflation doesn't exist.

Sadly, as they say in Brooklyn 'The Fish, it stinks from the head"
The weong people are being pushed out of Nikon.
The folks who will be leaving built this http://mir.com.my/rb/photography/companies/nikon/nikkoresources/fisheyes/6mmf28.htm

Once there were how many automobile manufacturers in North America? How many now remain? How many camera companies have been available to us over the years? How many remain?
Of those remaining how many also have other non-photo divisions under their name? How many have recently merged to be one?

Nikon as we once knew, may be soon a shadow of their present existence. In the era of computers masquerading as top quality cameras including Canon, Nikon, Sony and others; obsolescence is the name of the game. At three or six years of age your digital camera will not be repairable if something goes amiss. Then do you change brand monikers or do you resort as so many have done or are doing, to a mobile telephony device which can produce a darn good photo?
Technology, changes all, faster than we often desire; will Nikon be able to survive? Please prove me wrong.

I'm writing a reminder note to myself to go out and buy all the great all mechanical AF lenses Nikon still produces-that I want.

Long after the AFS and equivalent electronic lenses by Sony, Canon and the others will have had to be replaced twice, three times or more in our remaining lifetimes at huge expense, the mechanical Nikkors, like the 80-200mm, will not need a penny more expense in replacement or even maintenance costs.

My screw-drive AF Nikkors from the late 1980s still have a few decades of service left in them. And I've not had to spend a penny on maintenance or replacement in the nearly three decades I've had them.

I've never owned, or even used, a Nikon camera. (A rather remarkable fact to anyone who knows just how many cameras I have owned and used.). But I was always glad they existed to give Canon productive competition. That "competition", of course, comes increasingly from other companies and designs these days. But I do feel bad for Nikon dslr system devotees, mostly "old school" guys who have been with Nikon for decades. It becomes quickly evident from talking with some of them, as some of the comments here suggest, that they've felt that Nikon's let them down for some time.

More and more mutterings on the 'net about the changeover from DSLRs to Mirrorless is palpable when you look on ebay.. Try looking for a used mirrorless... Very little except for first generation stuff. DSLR's? Everywhere. The writing is on the wall, just as it was with film and digital. CaNikon either adapt or become very much bit players. This is especially sad for Nikon that has come out with some stellar lenses but at ebsorbitant prices and no customers left to sell to! Hurry up. Mirrorless is the future. Nikon, it's your 100th year. Time to take on a new challenge! Try and make those lenses smaller, cheaper and better.

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