Big, Bold Bad News

I have to admit that I'm a little worried about Nikon in 2021. Thom says there's little real significance to the recent announcement about Sendai that you've been reading about, and he's the expert, but what I worry about is something slightly different—it's that once again Nikon seems to have demonstrated a tin ear for perception, and casually dosed itself with self-inflicted harm without even seeming to realize it. It might be true that the Sendai plant was merely a test bed for ramping up manufacturing of new models, and that centralization in Thailand makes good business sense. But jeez, the great wash of news that ripples outward from this little dance move is "Nikon ends camera production in Japan"—after 70 years—Google the phrase I put in quotation marks and you get page after page of results from all over tarnation. If it's not actually a worrisome thing, then what's worrisome is that Nikon doesn't seem to care about the symbolism—the appearance of all those headlines and the misperception they no doubt are creating. Nikon seems unconcerned. They're Nikon. What, me worry?

The world grabs on to simple stories, not subtle ones. You have to be cautious about spreading big, bold bad news. And hasn't this happened before?

Not in the top ten
Meanwhile, back in the badly-buffeted USA, for what it's worth: at Lensrentals, which as far as li'l ol' me can discern is the leading rental house for higher-end photo gear, the top ten most-rented items in 2020 were all Canon and Sony. The Nikon name doesn't show up till the sixteenth slot.

Nikon isn't worried. That's what worries me.

Mike

Original contents copyright 2020 by Michael C. Johnston and/or the bylined author. All Rights Reserved. Links in this post may be to our affiliates; sales through affiliate links may benefit this site. As an Amazon Associate I earn from qualifying purchases.

Book of interest this week:

The Secret Lives of Color by Kassia St Clair
(clicking on the links above takes you to Amazon)

(To see all the comments, click on the "Comments" link below.)
Featured Comments from:

Niels: "On the premier Japanese price comparison site Kakaku.com, the Best Selling Interchangeable Lens Cameras list shows that Nikon has 10 cameras, Sony has 7, Canon 6, Olympus 3, Fujifilm 2 and Panasonic 2 cameras in the top 30 spots. Canon takes the first three spots, but Nikon dominates the list, interestingly mostly with DSLRs. Canon has no DSLRs in top 30. (Pentax show up at #31 with the KP DSLR)."

gary bliss (partial comment): "I bought my first Nikon in 1979, but shot with them the previous decade; my SLR/DSLR systems have been Nikon since then and they have worked well for me. Still, it has been hard not to be struck by Nikon's major missteps going back the AF transition. When they get a leg up on the competition (DSLRs) they find a way to blow it (lagging FF transition). Who thought we needed a one inch sensor system (Series 1)? Or another junky video 'action' camera (KeyMission)? They even managed to mess up a retro-DSLR (the Dƒ). All of these examples took significant enterprise resources to bring to market. Cumulatively they sink a firm by diverting management focus and squandering resources as well as, maybe more importantly, the careers of some of their best talent. Firms rise and fall on a road that looks like this (IBM, GM, etc.) and Nikon has been on the managerial downslope for quite some time."

Zyni Moë: "Very unclear why you think 'Nikon seems unconcerned.' Here is a quote from their financial report for fiscal year ending 31st March 2020: 'As a result, revenue for the Imaging Products Business decreased by 23.7% year on year to 225,894 million yen, and restructuring costs and impairment losses on non-current assets were recorded, resulting in the operating loss of 17,153 million yen (operating profit of 22,069 million yen was recorded in the previous fiscal year).' That is nearly a decline of one quarter in revenue, in one year, almost all of it before COVID. And a look at the quarterly figures since then is really alarming. Some of this is COVID, some not. Nikon are staring death in the face and they fully know they are: Nikon is very, very worried indeed. They probably have decided they must move production out of Japan or they must die rather soon. They have chosen not to die, or not to die yet. That is the decision I would have made, too."

Robert Roaldi (partial comment): "I'm not at all worried about the geographical location of assembly plants. It's mostly myth-making so far as I am concerned. Truth is we have no idea where almost anything is made anymore. When you go on company websites, it's almost impossible to figure out where their head office is or in what countries they operate. Are Japanese cars still Japanese when they built them in Tennessee and in Ontario, Canada? Are Toyotas from Ingersoll, Ontario, not Toyotas? Is a manufacturing robot in Mexico really less reliable than one in Bavaria or Malaysia? We still mentally operate based on 19th and 20th concepts of nation states."

Thom Hogan: "Oh, Nikon is indeed concerned. The internal debates this past year, as reported to me by a few in Tokyo that have been involved, have apparently been intense. There's a sense of urgency at Nikon HQ I haven't seen before with regards to the Imaging group. I would characterize that not so much as 'survival urgency' as 'relevance urgency.' The frightening thing to Nikon appears not to be whether they'll stay in business, but rather whether they can hold the #2 position in ILC and be perceived as a leader.

"But you're correct, their public face doesn't show this intensity or urgency. I've pointed out for years that Nikon's customer communication and interaction has been sub-optimal, and today is no different (though it's even more important today to get this right).

"As for Lensrentals, I've mentioned this before (and in conversations with Roger): Nikon users tend to buy what they need/want, not rent. More so than Canon users did. That's true of everything from books to exotic telephoto lenses. Moreover, a business like Lensrentals tends to be self-enforcing over time. If most of your rentals were Canon, you cater to Canon."

Craig Yuill (partial comment): "A number of people at various sites have pointed out that a significant percentage of rentals (approximately 36%) were for dedicated video cameras. Canon and Sony make those—Nikon does not. Also, several of those top rental items listed are top lenses for video. When it comes to stills cameras and lenses, Nikon is doing relatively well."

Comments

[Speed]

Lensrentals also mentioned Nikon in their year-end podcast noting that they are falling behind Canon and Sony in new product releases.

New technology, in this case mirrorless systems, require big investments in developing, manufacturing and marketing new products. Meanwhile, the market for everyone's consumer cameras has been decimated by remarkably good phone cameras. Lots of capital is required to rebuild product lines with the new technology.

And if that isn't enough, Canon and Sony are doing quite well with their professional video products -- a market that Nikon isn't in.

A peek at Sony's, Canon's and Nikon's revenues and R&D spending would tell the story.

[John Robison]

If the Great Yellow Father can fail, the name Kodak exists, but they are only the shadow of their former self, then.....
Nikon can sink, more rapidly than anyone would believe.

[Kwesi Budu-Arthur]

Sobering news indeed for Nikon.
What surprised me though is that Fuji didnt make the list.

[Ken Bennett]

I suspect a lot of what drives rentals is video, and when was the last time you heard someone rave about the video making abilities of their Nikon gear? And yeah, if I were Nikon that should worry me, too.

[gary bliss]

i bought my first Nikon in 1979, but shot with them the previous decade; my SLR/dSLR systems have been Nikon since then and they have worked well for me.

Still it has been hard not to be struck by Nikon's major mis-steps going back the AF transition. When they get a leg up on the competition (dSLRs) they find a way to blow it (lagging FF transition). Who thought we needed a one inch sensor system (Series 1)? Or another junky video "action" camera (KeyMission)? They even managed to mess up a retro-dSLR (the Df). All of these examples took significant enterprise resources to bring to market. Cumulatively they sink a firm by diverting management focus and squandering resources as well as, maybe more importantly, the careers of some of their best talent. Firms rise and fall on a road that looks like this (IBM, GM, etc) and Nikon has been on the managerial downslope for quite some time.

They have made some great photographic tools that i continue to use and probably will for what little of my photo taking needs i have left. Every reader of this blog well knows that equipment is not the center of our art but i would be hard pressed to recommend Nikon now to someone starting out unless the gear was really cheap and understood as a "stepping stone".

Sigh. Although i do not shoot film anymore my all-metal FM3a is still a joy to hold, focus with a MF AIS lens, and depress the shutter. It reminds me of my younger days shooting bulk TriX as a part-time PJ in the 70s. At that time (albeit, with a much heavier F body) it was the best you could get.

[terence morrissey]

Nikon was King in 2012 when the D800 was released.

[Robert Roaldi]

I'm not at all worried about the geographical location of assembly plants. It's mostly myth-making so far as I am concerned. Truth is we have no idea where almost anything is made anymore. When you go on company web sites, it's almost impossible to figure out where their head office is or in what countries they operate.

Are Japanese cars still Japanese when they built them in Tennessee and Ontario, Canada? Are Toyotas from Ingersoll Ontario not Toyotas?

Is a manufacturing robot in Mexico really less reliable than one in Bavaria or Malaysia?

We still mentally operate based on 19th and 20th concepts of nation states, and isolationist Americans and UK Brexiters are among the loudest backers of this viewpoint. But it's all self-delusion and vote conning. Reality is what reality is.

Many fall into the web-centric monopoly mindset that there is only room for 1 or 2 or 3 companies in any industry sector. Why? Is it real or just manufactured opinion? I can't tell.

[Dick Barbour]

I got "The Secret Lives of Color" on your recommendation and am really enjoying it. I got the Kindle version but am thinking about also getting the hardback, just to see all of those beautiful colors on the printed page. The author is a historian and she has some great stories about historical and artistic figures and their relationship with the colors. Good reading, thanks for pointing it out!

[Ken]

...the top ten most-rented items in 2020 were all Canon and Sony.
Well, that's true enough. But looked at a different way, the number one rented item was a lens, as well as 6 more of the top 10 items. In terms of camera bodies, the Nikon D750 came in at the number 5 spot. I guess Nikon owners have enough lenses, batteries & gimbals to get by for a while.

[John Merlin Williams]

Nikon Corp needs to send this message, troubling as it may be to consumers, to retain stockholder investment (recently, the Nikon Imaging division - cameras - has contributed something less than half of Nikon Corp revenue). Investors are keeping Nikon Corp viable for now, since Imaging's customers aren't/won't/can't. I suspect that Mitsubishi is still a major investor and I also suspect their interests are in Nikon Corp's other divisions: industrial laser metrology and chip fabs. It must be especially galling (i.e., insult to injury) for investors to see that the Sendai plant doesn't appear to have capacity even to keep up with what demand there is for its high-end, highest profit-margin cameras. The sad writing may be on the wall, but at least Imaging is trying to convince investors to hang in there, as they figure out a way to make customers enthused once again.

Desperate times, etc. Imaging needs to answer the call for "sensible" measures (e.g., easily-achieved cost cutting combined with increased higher-margin capacity), before the desperate call gets made for them.

[robert e]

I'm no business analyst, but it seems to me that while this may be alarming news for Nikon the camera company, it isn't for Nikon the maker of optics of all kinds, which decided years ago that the camera market was shrinking and to look to other areas for business growth: scientific and medical optics, photolithography (for semiconductor mfg.), 3D printing, etc.

According to wikipedia, Nikon's net income was ¥63.5 billion for fiscal 2019, compared to 18.2b for FY2015 (and a peak 75.4b in FY2007); and it's the world's 2nd largest producer of steppers for photolithography.

Consolidating camera manufacture looks like a logical step on that recovery roadmap, which seems to have worked for Nikon as a whole, if not for its camera division.

My non-expert rose-tinted takeaway is that Nikon is still an optics powerhouse, and having pivoted away from consumer cameras to survive, might well pivot back when circumstances change.

[Rob Campbell]

I would be surprised if any camera company is sitting still, complacently admiring its navel. I'd imagine that camera companies are far from alone in being under existential threat at this time. We live in a (first) world where there is already far too much of everything, and that can only mean a race to the graveyard for some. (We even have a farming industry that produces too much, yet people still starve in some lands.) There is this comforting myth that big business inevitably knows best, which when you consider the names that are now just memory, seems somewhat optimistic a view.

I think that several camera companies will end up closing down, just as have so many of the good shops that serviced them, where one could speak with a knowledgeable owner who'd be able to guide one through product ranges and offer good advice. Where are they now? Gone. That the public accepts this as the price of paying a percentage less for whatever it now buy from a faceless Internet name speaks volumes about mankind and his disjointed ideas about value for money. We deserve, as species, the poor service and sub-standard quality control that seems today's norm; by our choices we have voted what will survive.

[Sal Santamaura]

I was about to submit a comment saying what Thom said about Nikon users buying vs. Canon users renting, then saw he beat me to it.

In the last three years, having been uninvolved with anything photographic smaller than 4x5 for decades, I've purchased two Nikon DSLRs and an F6, along with six Sigma Art F-mount lenses. I appreciate the lensrentals.com blog, but, after serious consideration, couldn't bring myself to rent. Knowing whose reviewing/testing provides reliable information facilitated bypassing that step and going straight to purchases.

As for why Canon users take the opposite route, I've no idea.

[John Camp]

The advanced camera business has been contracting for a decade, ever since digital cameras got "good enough." For a while, it seemed, camera companies could sell a new advanced camera every two years or so. Now, I think, we're going back to the 20th Century film model, where a new "must have" model comes out every seven to ten years. I don't worry about Nikon so much, because it's more of a "hedgehog" type business, like Leica. It may get smaller, but I think it will survive because, basically, cameras is what they do. I'd be more concerned about Sony, because cameras are only a small part of what Sony does -- and as a company, Sony has always been brutal about cutting products and divisions that don't perform to their profit standards.

[Thomas Walsh]

Re: Nikon

From the Chronicles of Riddick:
Imam: Have you heard anything I've said?
Riddick: You said it's all circling the
drain - the whole universe. Right?
Imam: That's right.
Riddick: Had to end sometime.

[Dan Khong]

When I started using Nikon in the late 60's, it was top dog camera - made famous by the Nam' war photographers who slowly moved from rangefinders to SLRs. And being "Made in Japan" mattered.

While I still have the odd camera body and odd lens in my dry cabinet, I've not used a Nikon for >20 years now. I've moved away from SLRs. And being "Made in Thailand" matters to consumers!

[Albert W Erickson]

Mike, I thought I would jump in here since I have shot about every type of camera made. I did rent once to try a Leica M 9 but that was the only one I rented. I have shot and owned Olympus, Canon, Panasonic, Fuji and Nikon. I started with Nikon and now own a D750, Z6, a Z7II and also a fuji XT3. I still like Fuji primarly for travel. My new Z7II is clearly the best camera I have every owned. The primary reason to shoot Nikon are the new S lenses. The 24-70 F 2.8 lens is a dream lens and when mounted on either the Z7II or the Z6 it is magic. The same can be said of the 50 f 1.8. Both lenses are just incredible. Much better than any lens I have shot in the past, including Leica, Fuji 16-55 ( a beautiful lens is it's own right) and the little Panasonic 25 lens( another beauty). Nikon seems to be having a hard time meeting the demand for the Z7II. My local camera shop got in only one or two in December and I was fortunate enough to be high up on the list to be able to get it? At this point I am not worried about Nikon anymore than another camera company. They have a loyal following and really good products. I would encourage you to try the Z7II with a 50 prime sometime. I know you like to shoot primes, but that lens is wonderful. I still think the D850 is hard to obtain and still a great camera. Have thought about switching the D750 for it, but I like marriage too much to try that trade. I think the Z7II will be the final camera, it has that feel to it. Who knows, maybe next year will be a new Nikon? Happy and healthy New Year and keep on shooting. Eric

[Jeroen Pulles]

COVID19 may have made it much harder to share resources between the Thai and Japanese manufacturing sites.

Otherwise, no surprises on the PR-side (df, the DL compacts, ...). This is the Nikon that has never released a 23mm APS-C lens for reasons only known to Nikon. And I'm not expecting any other enthusiast lenses for the Z50, either.

[c.d.embrey]

Fact of life—we are all ageing-out. As a realist I understand no-one makes it out of here alive.

I don't have the exact same interests now as I did at 21. Do you? My children are not me. My father worked in law enforcement, I worked in the movie biz, my older son in IT. my younger son in construction.

My next hobby purchase will be a target pistol, not a camera. Target shooting is a competitive sport, enjoyed by men and women.

I've read that Rachel Maddow met her S.O at a shooting range. (BTW photo should fall under fair use exemption.)

Corporations are in business to make money. Many companies have already bailed from photography, and moved-on to more profitable products. For example Schneider now makes lenses for machine vision, not cameras.

[Andre Y]

I'm both an avid Nikon user, and a big fan of LensRentals. I was guessing that I'd be in the minority of their customers who rent Nikon until I looked at my last 10 rentals going back to November 2018, and found that I rented mostly specialized things I don't use very much like LED lights and wireless mics, along with some photo stuff here and there.

Notably, the 2018 rental was a Nikon Z7 and 35/1.8 to evaluate the system before jumping in, and the latest rental is waiting for stock of the new Nikkor 50/1.2 Z lens, as well as an anamorphic cine lens in Z mount. In between there was a Canon R6 with the 85/1.2L just to see what the fuss is about (and the fuss is indeed well-deserved), but mostly it's been non-Nikon equipment.

That said, I'm not sure LR or even the wider photo punditsphere understands the Nikon Z system well and how it fits in the photo world, and I place the blame for that in Nikon's non-existent marketing efforts. To use an analogy popular here, Nikon has built out in two years a complete Summicron-style line of f/1.8 lenses that have superlative performance (each being far better than its F-mount predecessor) and are still relatively affordable. You have 20mm, 24mm, 35mm, 50mm, and 85mm focal lengths which form a complete lens set that will serve almost any photographer well. People who need long lenses can either adapt F-mount telephotos (which works well) or wait for the upcoming long zooms and lenses. The only bad thing anyone can say about these new f/1.8 lenses is that they are bigger and heavier than their F-mount predecessors, but such is the price of performance. Also, those people shouldn't look at the Leica Summicron-SL lenses which are even larger.

My point is that Nikon has built out a superb, complete, classic lens range along with the standard pro f/2.8 trinity of zooms, resulting in a versatile, practical, and very capable system. No one seems to acknowledge this and instead prefer to complain about the lack of halo lenses like the monster f/1.2 primes and f/2 zoom Canon has. Those are impressive, but not many people are going to want to buy or carry those around all the time.

And while I was impressed at the ease of aiming the Canon R6's autofocus at almost anything, I ultimately could not use that system because Canon only had very expensive, heavy, and large f/1.2 primes and no prime wide lenses when I evaluated the system though they have a couple of smaller, slower primes now. So at the end of the day, it looks like getting the Nikon word out is going to be up to its users, because the system is very capable, but no one, including NIkon, seems to be able to tell anyone that.

My standard kit these days are a pair of Z6s (one being the new Mark II) along with the 20, 24, 50, and 85mm lenses. The kit 24-70/4 lens is excellent as well and underrated because it's overshadowed by its f/2.8 sibling's world-beating performance, but the f/4 zoom has a beautiful rendering especially for a zoom, and is the first lens I reach for if I'm shooting video. The 85mm is one of the finest 85mm lenses I've ever used and also has a beautiful rendering along with superb technical performance.

[Thom Hogan]

> Lensrentals also mentioned Nikon in their year-end podcast noting that they are falling behind Canon and Sony in new product releases.

I hate guessed-at statistics when the real ones are available. Mirrorless camera releases in 2020: Canon 3, Nikon 3, Sony 2. Mirrorless lens releases in 2020: Canon 7, Nikon 5, Sony 3. Just exactly how is that "falling behind in new product releases"?

As much as I like Roger, lately he hasn't applied the same clear analysis to things he says about Nikon as he does to say, lens evaluations.

[Rob Campbell]

Perhaps the trouble is that the new wonders are coming out a little late in the game. I get the feeling that photography is not the draw that it once was, that those younger people with the money to buy the expensive new toys lack one critical thing: the appetite for them.

When I look at camera stuff on the Internet, the enthusiasm seems to be generated by those with dogs in the fight: reviewers, people on contracts of some sort with famous brands. Perhaps they are invisible to me, but people other than older camera fans - as distinct from photographers who just get on perfectly well with whatever they have - do not seem to have much to say about new cameras or even old ones, for that matter. It truly seems that cameras are an obsession for people old enough to know better, not for younger folks whose interest begins and ends with their iPhone.

Let's face it: photography no longer carries with it some special mystery that once lent even pretty raw photographers some aura of being, well, a bit different to the Box Brownie brigade that, by and large, was pretty satisfied with that device and wouldn't have dreamed of spending more on snaps. I suspect that things went a bit strange round about the time photographers began to take themselves a bit too seriously and speak of their pictures as their "work" without it being, in fact their work.