AP INVESTIGATES: Do smaller interchangeable-lens cameras have a future after sales plunged more than 30%? And do people really care if they buy a compact system camera or a DSLR?

Above graphic, UK Only; Data source: GfK








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Video: AP news editor Chris Cheesman reports on the future for CSCs, interviewing industry experts and consumers

Amid great fanfare, the first compact system camera (CSC) was born in 2008.

The micro four thirds Panasonic Lumix DMC-G1 ignited a fierce turf-war with the traditional DSLR which recently saw the first full-frame CSC – the Alpha 7 – join a growing army of technology-laden upstarts.

CSCs – aka ‘mirrorless cameras’ (among a host of other names they have assumed since) – were heralded as easier to use and, with the absence of an SLR mirror-box, less bulky than a DSLR.

Yet, more than four times as many SLRs were sold in the UK last year than CSCs which notched up sales of just 100,000 units – 46,000 fewer than the year before, according to figures released by market research firm GfK.

Do people really care which format they buy?

Duncan Schwier owns both a CSC and DSLR – a Panasonic DMC-GF1 and Canon EOS 5D Mark II.

AP caught up with Duncan at Park Cameras’ new store in central London.

Duncan says he carries the GF1 as an ‘opportunist camera’ for candid shots, but not when he is “going out to take a photograph”‘.

He explains that his DSLR encourages him to think about the photograph – as part of a ‘more intellectual process’ – rather than just taking what’s in front of him.

A dedicated enthusiast since student days, he tells AP: ‘I find the smaller camera a little fiddly sometimes … you’ve got to rummage through the menus to find what you are after.’

That said, when his niece wanted a system camera, Duncan recommended she buy a GF2 ‘simply because it was cost-effective, she would have a lot of fun with it and it goes in a handbag’.

Confusing category names

Fellow enthusiast Paul Dowker, who has been taking pictures for 16 years, bought a CSC to complement his ageing DSLR.

‘I’ll take my compact system because it’s new and has more megapixels… but it is also so much easier to use.’

Though now an experienced enthusiast, Paul believes the term ‘CSC’ is confusing to people new to photography.

This may be a prime reason for slumping sales.

‘When I first started, a “compact camera” was a small point and shoot.

‘Now you have the “compact system”. I think people get confused over what is a digital compact pocket camera and a decent semi-pro piece of kit.

‘So, maybe some polishing up of the terms and phrases [is needed],’ he says.

This view is echoed by Pete Sharpe, manager of Park Cameras store in London.

‘I think everybody knows what a DSLR is – it’s a catch-all term for digital SLRs. But CSC cameras get called all sort of things.

‘It would be nice if all the brands can all agree on one title for that type of product.’

Richard Gregory, GfK account director for Consumer Electronics adds: ‘It’s difficult for consumers to understand sometimes exactly what it is they are buying and what the differences are.

Richard Gregory, GfK

‘On the face of it, it’s a large SLR versus a small SLR [style-camera] and maybe the marketing and the education needs to move that way’.

‘Generic term is DSLR’

Part of the problem, suggests Nikon, is consumers not regarding CSCs as a separate category in the way manufacturers do – leading them to plump for a DSLR instead.

Hidehiko Tanaka, managing director of Nikon UK, said recently: ‘I feel that, in this country, if [customers] want a camera with an interchangeable lens, they are thinking of the traditional SLR…’

Adding to the confusion, CSCs are at sometimes incorrectly referred to as ‘DSLRs’.
 
‘Consumers are not shopping for CSC because the generic term of the category is DSLR,’ notes Panasonic’s Barney Sykes, UK product and marketing manager for Lumix G.

While Nikon says it wants to more clearly target the format towards specific customer needs – citing the ‘waterproof’ AW1 version of the Nikon 1 as a case in point – Panasonic has pledged to go a step further, repositioning CSCs as a ‘top-end’ product.

This was signalled by the early unveiling of the DMC-GH4 earlier this month. Armed with 4K video it appears to have been announced way ahead of the camera’s availability, serving as a statement of intent.

Despite an explosion of CSCs from electronics wizards such as Panasonic, Sony and Samsung, DSLRs continue to dominate a market driven by the two biggest camera brands, according to Sharpe.

‘We are a country of traditionalists,’ he asserts.

‘You’ve got the big boys like Canon and Nikon who are doing very well… But these brands don’t have the most successful compact system cameras and, for whatever reason, [consumers] are still hanging on to the glory days of Canon and Nikon.

‘I think they largely have this idea that it’s got to be a Canon or a Nikon because that is what they have been told to buy, by a friend.

‘So, even though CSCs have lots of benefits, I think we are struggling still to treat technology companies as serious camera brands.’

‘Wider accessory range’

Crucially perhaps, notwithstanding the enthusiasm of retail staff to promote CSCs, Sharpe points out that DSLRs are more attractive to shoppers as they offer a wider range of accessories.

Olympus, Panasonic and Sony-made CSCs have proved popular at Park Cameras, but Sharpe urges manufacturers to ‘start exploring the virtues of the CSC’, over a DSLR.

‘The vast majority of CSC converts are doing it because they are fed up with carrying around a big bag full of stuff… the cameras themselves are smaller and lighter but all the accessories like the flashguns and lenses are too…

‘You often see that cut-out outline of a DSLR body with a CSC inside it. But you don’t see this as much now as you did at the beginning.’

GFK’s Richard Gregory points out that it may be unfair to focus purely on compact system cameras when DSLR unit sales also fell (albeit only by 11%).

And he explains that prolific CSC promotional activity by camera makers in the previous year, means sales results for 2013 paint a gloomier picture than CSCs deserve.

Panasonic largely blames the disappearance of Jessops stores under former owners in January 2013 for a drop in its CSC sales – though it refuses to say how much they fell.

Jessops’ disappearance from the high street under former owners hit sales nationwide

‘The other impact… was that, all of a sudden, Samsung gave a free tablet away… which, arguably, just artificially exploded the market…’ says Sykes.

Blurred lines

The prevalence of the bottom-end DSLR, which may not boast all the technological advances of a CSC, but may be considerable cheaper, is also a threat.

Sykes stresses that CSCs cannot compete, in price terms, against a £399 twin-lens DSLR kit from [general consumer electronics stores], for example.

‘The lines are getting blurred, especially with price,’ concurs GfK’s Richard Gregory.

‘We track body-only sales. Sub-£300 SLR cameras have grown, as a proportion, quite significantly, especially in Q4 [of 2013] … ‘That’s going to start to challenge compact system camera average prices.’

Panasonic recognises it must act now to drive up sales and Nikon UK freely admits it has more work to do to highlight the benefits of the compact form.

‘For the first four years, maybe a lot of the CSC brands tried to sell volume. That may not have been the right approach. Now, we are going to try to add features and benefits and educate the consumer,’ says Sykes.

Education, education…

Successful marketing of CSCs, through online education, may be the key to future success given that internet sales account for more than 40% of imaging market’s value, according to GfK. This compares to an average of 20% for the consumer electronics industry.

However, Gregory points to the difficulty in relaying the benefits of CSCs through a web page when, a few years ago, ‘we saw the majority of people going in store, getting that advice and being able to act on it’.

As part of its campaign Panasonic has this month gone as far as imploring photography journalists to conduct reviews of CSCs ‘against DSLRs’, rather than testing like with like.

The self-promotion project appears to be paying dividends. A seminar by professional photographer David Eustace, who uses a Panasonic GX7, proved so popular that organisers were forced to ‘turn people away’ from a recent event at the Peter Jones store in Chelsea.

‘They [students] said they didn’t even know this technology existed. They assumed the only camera they could use was a DSLR,’ says Sykes who remains optimistic on the back of encouraging CSC sales figures for early January.

Growth signs

‘Compact system camera is now returning to a period of growth which is really pleasing…’ Sykes enthuses.

Likewise, Fujifilm and Olympus will have welcomed figures released in the past few weeks suggesting that the Fuji X-E2 and flagship Olympus OM-D E-M1 each played a key role in reviving the firms’ respective camera divisions – cutting losses by 60% in each case.

‘Our research tells us that 48% of consumers who bought a DSLR in the past two years… would now consider a Lumix G,’ adds Sykes.

‘Compact system since week one of 2014 has actually shown growth, versus 2013,’ confirms GfK’s Richard Gregory.

But, he cautions: ‘We need to realise that some of that is down to the retail landscape.

‘Obviously we saw Jessops go out of business at the beginning of 2013 and so it’s going to be a few weeks before we can see that there’s been an uplift in the category.’

GfK forecasts a 5% rise in all system camera sales in the UK this year, plus a rise in interchangeable-lens camera sales worldwide if figures for North America are stripped out.

Park Cameras’ Pete Sharpe remains guarded, however. ‘From my experience we are still selling a lot of Canon and Nikon. CSC sales are definitely increasing – but the majority of interest still seems to be in DSLR.’

  • Tim Smith

    I’m fairly new to SLRs so I’m probably not as clear as some about what the differences are but at a casual glance I don’t see why I would want a CSC. They look more expensive than a DSLR and by paying less I get an optical viewfinder – no contest! I don’t really see the supposed size advantage. It may just be the way I use my camera but I don’t find my Nikon D5100 and three or four lenses and a tripod too much trouble to take places. I can drop back to a superzoom if I need to travel light. The compact nature of some CSCs might be to their disadvantage as far as I can tell. Some things go past their best size when they are on this minaturization process, phones have done it and I suspect CSCs have too as my Nikon fits my hand nicely.

  • Peter Caulfield

    The only thing my CSC lacks is a high frame rate, its only 3 fps, I like EVFs I have adapters for my old Nikon, Minolta and Olympus lenses, plus T2 mount long tele lenses for moon shots and some old Russian M39 rangefinder lenses. With the Micro 4/3 2 times crop a 50mm f1.8 becomes a nice 100mm f1.8. But its not just about using old lenses. There is nothing I cant do with my CSC that I could do better with a DSLR and I have been using SLR cameras since the mid 1970s. I do think people new to photography and wanting their first real camera will automatically go for a DSLR camera because they are not sure what a CSC is and how versatile they are. A good example is, I have friends who have used film SLRs as long as I have, their SLR film cameras are now in their lofts or cupboards and they now use digital compact cameras, ask them what a CSC is and they dont know. They think it is as it always was SLR and compact cameras. Manufactures need to explane first what they are and second how versatile they are. Because everyone already knows what DSLRs and compact cameras are.

  • Adrian Downing

    Does anyone remember the Pentax SLR that used 110 sized film? I don’t think that ever caught on as a format. And then there was the Canon APS format SLR’s. I bought a metal one and a plastic one for my collection for less than £10 on e-bay, when you could still get the film in Boots. Very disappointed with the results, no where near as good as my EOS 33.

    If you are going to invest in a body and some lenses, you are probably going to do it in a format that is well established with a wide following. You are probably going to want the quality a large sensor APSC or full frame can deliver.

    If you want a small camera you are probably going to want just that, not a small camera and a bag full of lenses. There are plenty of excellent compacts available such as the Panasonic TZ that my wife uses and did, for a (short) while, have me wondering why I lugged so much expensive and heavy gear around! EOS 7D/EF100-440L/EF24-105L/Sigma 10-20/Flash gun etc etc!

    The CSC is neither one thing or the other and does not have the benefits of either a DSLR or a modern compact. They were the latest gimmick and must have tec. Now the hype has died down and people are asking themselves, “what do I really want from a camera?” they are going the way of the 110 and APS SLRS.

  • dyna

    Any particular reason why comments aren’t being allowed?

  • mirrorlessforums.com

    Just because of down sales in 2013 doeant mean MLS cameras going off market.. Most of the Fuji. Panasonic, Sony Olympus latest CSCs were anounced after October and available from December. So the ‘shown growth’from 2014 is all down to these new releases and I assume its going to coninue with more advancements expected in 2014. A7-R, first FF in MLS already scoring just underthe D600 like DSLRs, its not far they match up.

  • dyna

    Bunk. What you have is a sales environment that collapsed because of its total inability to organically shift with technological paradigms. The jackass who states that the DSLR begs the photographer to get more out of their camera vs a mirrorless product is simply and grossly misinformed. Odd how Japan and the rest of Europe have both successfully embraced the mirrorless system cameras to the point of near-parity. Odd how unbiased reviewers have accpted mirrorless cameras as both amateur and professional level gear alike. System cameras like the Sony A7r and their forthcoming A6000 are flat out DSLR replacements that can do everything an SLR can do, in many cases better. They are quite as serious a product, they are better built for the money and offer cutting edge technologies that Canon and Nikon simply do not even have in their catalog. Panasonic’s GH4 will be the video powerhouse people thought the 5DMkIII should have been. Samsung’s connectivity puts the 70D to shame, Olympus’ OMD product line set a new standard for what crop sensor cameras are supposed to achieve (including autofocus speeds that put Canon’s ridiculously hyperbolic “Game Changer” out to pasture), Fuji’s fanatical fanbase will be happy to tell you that the X-Trans sensor is the second coming of their personal savior.

    No. I’m sorry. The problem a lot of peope have is that Nikon was terrified of cannibalizing DSLR sales, even with their own product!! And Canon abandoned their mirrorless product at birth, almost as if in an attempt to give mirrorless products a black eye. Canon was upset they even had to ship the EOS M and their followup release of the SL1 is a sad, sad attempt at a toy camera, using five year architecture, competing with smaller cameras that destroy its feature set for the same amount of money. We won’t even go into Nikon’s total lack of vision in their entry level lineup; it’s just too painful to discuss. The A6000 in preliminary reviews is already stomping the D5300 and is even competing with the 70D in capability. If the A6000 did all-intra at 50mbps, it’d be all over for the $1200 DSLR… killed by a $650 mirrorless product.

    AP: the old guard doesn’t need this kind of journalism to assist it’s shilling of tradition over innovation: this is the sort of crap that burned Tesla to the ground. Canon and Nikon haven’t innovated in 5 years. In that time span, Sony has shown them what technology R&D is supposed to look like. Fuji design. Olympus build. Samsung connectivity. Panasonic engine. And these 5 feed off each other so, at this point, we have several surprisingly complete systems ready to go.

    Naming conventions don’t confuse consumers. They confuse lazy ass sales people who have stopped wanting to research and support their clientele because the sales staff have become bitter due to their constant and unfortunate requirement to compete with that bastard on the internet by which I mean both B&H Photo AND the supposed expert blogger. Today’s customer comes in knowing more than enough to be dangerous. They don’t give a damn about naming conventions, they just want someone to simplify the buying process for them. If the sales person gets hung up on naming issues then so will the client. It doesn’t matter what the camera types are called: a landscape photographer looking at a 5DMkIII and an A7r should be leaving with the A7r because it is the better camera for that genre of photography. Mirrorless/DSLR/ILC/CSC it’s all b.s. Just sell the better camera and get over yourselves and your brand religions: the fact is that, in today’s market, the better camera is often a compact interchangeable model and it often even costs less than competitive traditional designs. The two can coexist and camera stores should be able to adapt and openly educate consumers about which one is right for their needs but if we continue to see managers and “Experts” like I saw in this video who think mirrorless cameras are but a toy, don’t be surprised when their stores disappear because their customers were tired of either a.) The backwards, snotty attitude or b.) The stores’ sudden and inexplicable lack of ability to support a system (and its accessories) that has been widely accepted globally as a progressive movement in photography simply because a few solitary individuals in the industry can’t get past the fact that the brands dragging all of us into the future of imaging are neither Canon nor Nikon.

    The future is coming. The electronics companies and the companies with no previous ties to a mirrored mount will be the best suited to shape it. They’re able to build their own lenses just fine but they’re also able to adapt to pretty much anything else leaving the idea of pure proprietary modularity in the dust along with the two major manufacturers who cannot seem to let go… and the camera stores stubbornly devoted to the old guard who suffer from the same affliction.

    I can’t wait.

  • dyna

    Bunk. What you have is a sales environment that collapsed because of its total inability to organically shift with technological paradigms. The jackass who states that the DSLR begs the photographer to get more out of their camera vs a mirrorless product is simply and grossly misinformed. Odd how Japan and the rest of Europe have both successfully embraced the mirrorless system cameras to the point of near-parity.  Odd how unbiased reviewers have accpted mirrorless cameras as both amateur and professional level gear alike. System cameras like the Sony A7r and their forthcoming A6000 are flat out DSLR replacements that can do everything an SLR can do, in many cases better. They are quite as serious a product, they are better built for the money and offer cutting edge technologies that Canon and Nikon simply do not even have in their catalog. Panasonic’s GH4 will be the video powerhouse people thought the 5DMkIII should have been. Samsung’s connectivity puts the 70D to shame, Olympus’ OMD product line set a new standard for what crop sensor cameras are supposed to achieve (including autofocus speeds that put Canon’s ridiculously hyperbolic “Game Changer” out to pasture), Fuji’s fanatical fanbase will be happy to tell you that the X-Trans sensor is the second coming of their personal savior.

    No. I’m sorry. The problem a lot of peope have is that Nikon was terrified of cannibalizing DSLR sales, even with their own product!! And Canon abandoned their mirrorless product at birth, almost as if in an attempt to give mirrorless systems a black eye. Canon was pissed they even had to ship the EOS M and their followup release of the SL1 is a sad, sad attempt at a toy camera, using 5 year old architecture, competing with smaller cameras that destroy its feature set for the same amount of money. We won’t even go into Nikon’s total lack of vision in their entry level lineup: it’s just too painful to discuss. The A6000 in preliminary reviews is already stomping the D5300 and is even competing with the 70D in capability. If the A6000 did all-intra at 50mbps, it’d be all over for the $1200 DSLR… killed by a $650 mirrorless product.

    AP: the old guard doesn’t need this kind of journalism to assist it’s shilling of tradition over innovation; this is the sort of crap that burned Tesla to the ground. Canon and Nikon haven’t innovated in 5 years. In that time span, Sony has shown them what technology R&D is supposed to look like. Fuji design. Olympus build. Samsung connectivity. Panasonic engine. And these 5 feed off each other so, at this point, we have several surprisingly complete systems ready to go. Naming conventions don’t confuse consumers. They confuse lazy ass sales people who have stopped wanting to research and support their clientele because the sales staff have become bitter due to their constant and unfortunate requirement to compete with that bastard on the internet by which I mean both B&H Photo AND the supposed expert blogger. Today’s customer comes in knowing more than enough to be dangerous. They don’t give a damn about naming conventions, they just want someone to simplify the buying process for them. If the sales person gets hung up on naming issues then so will the client. It doesn’t matter what they’re called: a landscape photographer looking at a 5DMkIII and an A7r should be leaving with the A7r because it is the better camera for that genre of photography. Mirrorless/DSLR/ILC/CSC it’s all b.s.  Just sell the better camera and get over yourselves and your brand religions: the fact is that, in today’s market, the better camera is often a compact interchangeable model and it often even costs less than competitive traditional designs. The two can coexist and camera stores should be able to adapt and openly educate consumers about which one is right for their needs but if we continue to see managers and “Experts” like I saw in this video who think mirrorless cameras are but a toy, don’t be surprised when their stores disappear because their customers were tired of either a.) The backwards, snotty attitude or b.) The stores’ sudden and inexplicable lack of ability to support a system (and its accessories) that has been widely accepted globally as a progressive movement in photography simply because a few solitary individuals in the industry can’t get past the fact that the brands dragging all of us into the future of imaging are neither Canon nor Nikon.

    The future is coming. The electronics companies and the companies with no previous ties to a mirrored mount will be the best suited to shape it. They’re able to build their own lenses just fine but they’re also able to adapt to pretty much anything else leaving the idea of pure proprietary modularity in the dust along with the two major manufacturers who cannot seem to let go… and the camera stores stubbornly devoted to the old guard who suffer from the same affliction.

    I can’t wait.

  • Manuel

    Just sold my Nikon D300. DSLR is too heavy, but nearly until today no CSC could offer the same quality. Well, can’t await the arrival of my new CSC Fujifilm X-T1.

  • terry fallis

    I have mainly used Canon gear from my film days to my digital arrival approx year 2000.I also had lots of other film cameras both 35mm and medium format plus 5×4.But the camera that I use when going out on a daily basis is the XE1 with adaptors for some of my old leica and voightlander lenses. The main reason being the lightness of my kit which can exist of camera plus up to three lenses.I still take my canon 5D mk 11 sometimes but no where as much as I did in the past because although the XE1 is down in megapixels to my canon the quality from the XE1 is very impressive and I have several friends of my own age who appreciate the difference in weight of the CSCs

  • ecdy

    “CSC” tells us nothing. Why not “Digital Viewfinder Camera” (DVC)? Simple, descriptive, differentiable from “DSLR.”

  • N R Von Staden

    I can tell you in one word….viewfinder…yes missing in most of these smaller formats…but as photojournalis shooting Nikon for over 40 years I love my Fuji X100s

  • Steve Johns

    “Mirrorless” is the term making progress. It is more understandable. I use a 5D III & a II for “heavy” work. However, I also have a Fujifilm X Pro 1 and a number of lenses. When it’s not full frame it is Mirrorless for me – especially when a full travel system packs into a SMALL & LIGHT Think Tank bag. I know several pros who do the same and a couple have even gone totally Mirrorless. This being said, I believe that the future for Mirrorless is at the high performance end of the scale.

  • Kevin Sanders

    Probably deemed off-topic, but were those the best colours you could come up with for that extremely counter-intuitive graphic?
    We’re supposed to be artists, I know, but come on. Really? And the expand option makes it about 50% bigger, but still tiny on my 1920×1200 screen. On the other hand, the font in this box is so big I only have 17 characters per line.

  • Peter Caulfield

    I beleave experienced amateur photographers who follow the market, and all the latest releases will know exactly what is available and buy what suits there needs be it DSLR or CSC. On the other hand people with no real knowledge of photography who want a “real camera”, will go for a DSLR, probably from Argos or on line. Because SLR cameras have dominated the market since the 1950s. everyone knows what they are, whereas most people think CSCs are a type of compact camera. Plus most high street camera shops ( those that are still in business ) tend to push DSLRs over CSCs to new customers when they are not sure what they want. “They will say they don’t do this” but they do. I beleave people trading up from a compact camera, will buy a DSLR simply because they do not understand what a CSC is.

  • John Price

    dSLRs are often viewed as “serious” cameras whereas the smaller CSCs have a lot going for them including excellent image quality. Canon and Nikon continue to churn out the same old dSLRs with a few new bells and whistles but they are not innovative. Sony, Fuji and Panasonic are the real innovators, particularly Sony with the A7, A7R , RX1, RX10 and RX100 models. Essentially the different types are different horses for different courses. I wouldn’t take a dSLR abroad, for example, but would take my RX100. When back home doing specific photo projects I would take my A37 and my RX100 for the day.

  • Ron Graves

    “Do people really care which format they buy?”

    I do, and you couldn’t sell me a camera without a viewfinder as standard. Which means a DSLR. I do have bridge superzoom, a Canon SX30, but the image quality, especially at the long end, can’t compare with, say, my Zuiko 70-300mm zoom (35mm = 140-600mm) + Oly E420 body. Yep, I know it’s not cutting edge – neither is my wallet!

  • Steven Manderville

    Well I bought a G5 twin lens kit from Park cameras in Jan 2014,350 quid.Fantastically light.Very easy to use.Although I have pnt/shoot,Canon sx50,It’s the first serious dslr type camera I’ve had since my days with the Nikon F90x.Did consider a Canon/Nikon,but after much research,plumped for the Lumix.No regrets.Good primes can be a bit expensive though.I would recommend.

  • Lindsay Forster

    Compact System Cameras definitely have a future providing they have quality Electronic Viewfinder with c100% magnification and range of lenses whose weight is in balance with the smaller and generally lighter body. Their prices for bodies and kits also has to be a little cheaper on a like for like basis with their big brothers.