By Lisa Johnston
New products on display at the American International Toy Fair, held in N
TWICE:As the market looks at its next stage of development, from an early adopter to a mass market phenomenon, what are some of the challenges from a technical or marketing standpoint that you are facing?
MINNOCK: There is still a lot of opportunity in the area of ease of use and the ability to have the camera and all the other elements of the ecosystem work much better together.
SIENKIEWICZ: There are a lot of different ways to say the same thing. I guess I'll address the energy issue. The power supply, the battery, still takes up too large a percentage of the physical device. Some people stress that by saying that the batteries don't last long enough, that consumers are not satisfied with how many pictures they can take or how long they can play it back. But I think the correct way to frame that is that the battery still is too large a percentage of the camera.
PAUL D'ANDREA (Fujifilm): Two things stand out for us. One is, continuing to provide a range of feature sets to meet the needs of a mass audience, which is going to be a little different [then the current early adopter]. So the right amount of pixels and the right amount of zoom are two of the key characteristics that we're focusing in on.
The other thing that we really think is going to become critical this year is the need to start to get these pictures printed. As it goes mass, all our indications are that consumers want these pictures printed just as they did with the pictures they captured on film cameras. And retailers are going to need to get serious, we think, this year, about starting to install that basic equipment that is going to allow them to do that.
GREG YOUNG (Sony): Although I would agree with Paul [D'Andrea], and I think a number of my other colleagues here, that a lot of pictures are going to be printed in the next two years, I think we are seeing a substantial ... I hate to use the word paradigm shift ... but we are seeing something happening in the market that is driven by these technologies that is changing the way people use images. And it is not going to drive most people to print their images.
I think that only about one of every ten images captured over the next five years is going to be printed. That is a substantial shift and we all have to learn to make more money in the different environment as we move to that. But I really don't think there are huge technical hurdles to be overcome at this moment. I think really there are more perceptual hurdles.
We're all attacking ease of use in our own ways, certainly. But also, what do people do with their images? Where do they share them? How do they see them? I think the only company I see that is missing here, interestingly enough, that might have a significant play in this is Nokia. And I think we are all going to have to think about how integrated cellular and wireless devices play in the future. And I think that's going to be another major shift in the next couple of years that has immense consequences.
CARR: First of all, as we move from early adopter to mass consumer, the number one issue that we have to face is customer satisfaction. In the film world, customer satisfaction is up around ninety to ninety-five percent. We're not there today with digital and all of us have to face that.
The second thing is, in the life cycle of a digital snap-shooter, the first issue was getting images out of the camera. We've solved that. Next is showing consumers how to print it and print it with good quality. We're working on that. How do they find places to print their pictures? But as billions of pictures start to be taken, this goes to Greg's comment, how do you organize them? How do you find them? And that's another issue we really have to address next.
PECK: I agree we've gotten past our hurdle of how do I get the picture out of the camera. And I see the industry, both from the manufacturing and the retailer side, of how do you get the end user to be printing more of these pictures; because the majority still want to take a picture, they want to put them in an album, a frame or a shoebox. I think that once we can make that a simple process, an easy process, and show them the quality is as good, if not better, than what they've seen over the past years, that this is the next quantum leap.
JERRY GROSSMAN (Nikon): It has to get easier to use for people to really, on the mass level, accept digital cameras. And whether it's in the hardware or whether it's in the software, or whether it's in a combination of both, people have to think that a digital camera is as easy to use as a film camera — as a point and shoot camera. And I think we're going to get there.
I don't think we can ever lose sight of the fact that people are not buying pieces of hardware, they are buying memories — they are buying pictures. So making the camera not only easy to use, but enabling them to take better images, and take them easier is going to be very important in the long run.
OSTERSTOCK: If I take this back and try to compare it to a category that I was involved in from the launch, which was DVD, that was successful because there was a clear message to the consumer of the benefits of what DVD offered. There was a clear understanding for the consumer of what this offered as opposed to maybe VHS.
Now the consumer obviously understands at this point that a digital camera can offer some clear benefits; they can take a picture and they can erase the ones that they don't want and keep the ones they do. They have a nice, removable memory card. They can take that memory card and transport it from one device to another. They could use it in their digital still camera, maybe they can use it in their camcorder, they can obviously use it in their PC. But I think one of the things that hasn't been talked about is really what the consumer does with that format. Now everybody supports different memory cards and that's terrific and they have their reason for doing that. But I think as consumers buy more products that accept these removable memories, that potentially will become a factor because we're going to have multiple formats. And if they're stepping into a new DV camcorder, or they're stepping into a new portable device, are those memory cards going to be compatible with all those different devices?
I don't think it's really a major thought right now when they purchase their camera, because most memory cards are competitively priced. They focus on the camera first, which is what I know we need to do and as well as on the ease of use. But eventually, I think, as those cards become used in more products, that's going to become an issue down the road where maybe they're going to have to make some of those decisions earlier on. I think that's out there as far as a technology decision that's on the horizon.
MULLER: There aren't necessarily huge technological hurdles to overcome right now. However, I think there is a big hurdle to overcome in ease of use, which a lot of people have mentioned already. With only about seventeen to twenty percent household penetration right now with digital cameras, we have really only scratched the surface of the American consumer. And for the mass consumer, which this question is focused on, I think the out-of-box experience of the digital camera is still extremely intimidating.
So I think we can go a long way with taking the technology we currently have, we have four and five and six million pixel CCDs. The mass consumer doesn't need a whole lot more than that right now. I think that's where our next real leap can be, not necessarily in the technology, but how to deliver the current technology we have to the mass consumer.
This TWICE webinar, hosted by senior editor Alan Wolf, will take a look at what may be the hottest CE products at retail that will be sold during the all-important fourth quarter. Top technologies, market strategies and industry trends will be discussed with industry analysts and executives.