Why Canon is the Microsoft of the Camera World

    Given Canon’s strong foothold – or should have been increasingly stifled – in the mirrorless camera market, you could easily argue that it is becoming the Microsoft of the camera world. Microsoft is widely known in the personal computing world for their software products that have always had a strong impact on business, school and home, from productivity to media and entertainment. In fact, the core OS of most PCs runs Microsoft Windows (about 75%).

    Founded in 1975, Microsoft came out of the computer era in the Wild West when mainframes left government agencies and large corporations, with the advent of small home devices, Low cost programmable by enthusiasts. Focused on software that could run programming code on these early machines, however, its big break came in 1980 when IBM asked it to provide an operating system for its new personal computer. me. It didn’t make an operating system, so bought an operating system called 86-DOS, renamed it MS-DOS, and sold the license to IBM, but retained ownership.

    Although IBM has copyrighted the BIOS – the little piece of code on your PC that interfaces between the hardware and the operating system – no such restriction applies to the operating system itself, which Microsoft owns. Once the BIOS was reverse engineered, Microsoft was free to sell MS-DOS to the world.

    And it did.

    After the initial public offering, the share price rose thanks to the continued successes that have created 3 billionaires and about 12,000 millionaires from the company’s employees.

    Microsoft and Canon: Similarities

    What makes Microsoft stand out in the computer world is its complete dominance in a wide range of fields. For example, its 75% share of the desktop market (although down from 95% in 2009). In fact, since the days of MS-DOS and the rise of IBM-compatible PCs, Microsoft has had operating system figures as high as 90%.

    It has also previously dominated with Internet Explorer, Office, and Windows Server. It’s also not historically been a hardware company – with the exception of the long-running Microsoft Mouse – but branched out with Xbox, as well as its Surface and HoloLens devices. And let’s not forget the Nokia acquisition and the Windows Mobile blunder.

    Microsoft is everywhere, especially because it has re-imagined itself in the new era of subscription services (or Software as a Service) and is heavily focused on the cloud.

    Of course, it’s not the computer software that defines the Canon but the camera. Founded in 1933, the business is primarily focused on the optics and printing divisions, although it was originally a camera manufacturer and introduced the Kwanon, the first 35mm focal plane shutter camera. first of Japan.

    Canon is now a huge company generating 3.513 billion yen (about 30 billion USD) in revenue with about 200,000 employees worldwide. It has expanded its business into the printing and related optical industries, including medical imaging and industrial applications such as lithography. It is also more unusual among camera manufacturers in that they design and manufacture their own sensors.

    However, it is Canon’s overall successes in the home printer and camera markets that really make it stand out in the consumer arena. This is a significant measure because enterprises determine their desire to continuously reinvent themselves on the basis of innovation and quality. No one has ever let past successes stand in the way of future product pursuits. This is a difficult path to take and one where many other companies have failed. You want to develop technologies fast enough to market globally, but not so quickly that they are overtaken by other manufacturers.

    Canon released a series of stabilized camera technologies such as Serenar lenses, Canonflex SLR, F-1 SLR (with FD mount included) and AE-1 (integrated microprocessor), prior to the release of the system. EOS (including EF mount). When Nikon steadfastly supported the F-mount, Canon pushed lens designs to new limits. It was this relentless innovation that eventually led Nikon to overtake Nikon as the leading camera manufacturer in the 1990s.

    While we may be interested in camera innovation, it now accounts for only 19% of Canon’s net sales, and printing is the most important aspect of its business with 55%. That said, Canon is still a force to be reckoned with and – depending on how you count the numbers – accounts for around 40% of the camera market in both sales and revenue. This is a changing dynamic that causes it to shift away from DSLRs and built-in cameras in favor of more profitable mirrorless models.

    However, 40% market share does not equate to 75% of the desktop market that Microsoft has, which does not reflect that most computing is done on smartphones, which makes iOS and other Its other derivatives become globally important. And of course, smartphones also make up the vast majority of cameras sold today. In their particular markets, both Microsoft and Canon are dominant forces, and no one can deny that their market share is, at least in part, based on producing quality products. that everyone wants.

    Canon has successfully used technology to attract key markets to drive further success in the market chain. For example, the release of the EF mount has made their products more favorable with working professionals who have built up popular success and moved down to more consumer-focused products. This comes at a time of mass market expansion that the company can take advantage of, dramatically increasing its business. And while Nikon launched its first fully integrated DSLR, it was Canon that managed to take advantage of filling its range, again with a trickle mode.

    There are two core markets – consumer and business/professional – for both Canon and Microsoft, which have different motives and needs, leading to the development of different products.

    For consumers, Canon can be seen as a “safe bet” when buying a camera, with the consumer paying a premium for something that “works”. The mindset of this consumer group has been demonstrated by new mirrorless camera models that have skyrocketed from near zero sales to the virtual equivalent of Sony in just a few short years.

    Microsoft has become accustomed to technological innovation to maintain its market position and income stream. While Windows may be dominating, it is no longer the main source of income, which is now being driven by its subscription services.

    On the “professional” side, Canon is of course after professional photographers, and for Microsoft, it’s aimed at corporations and businesses. Enterprise sales drive earnings and penetration into broader consumer markets, with Windows increasingly being just a platform to deliver this service. In fact, Microsoft has increasingly ventured into macOS, iOS, and Android to sell more licenses and change souls, adopting the use of open source software (after Steve Ballmer’s infamous “Linux is a disease”). cancer” Quote). Likewise, Microsoft is a safe bet.

    Dark side

    Of course, Microsoft’s success has not been entirely without incident, especially the Department of Justice’s anti-competitive conduct lawsuit regarding monopolistic practices. It was the swiftness of Microsoft’s business dealings to maintain control of operating system licenses – and subsequently other product categories – that caught the Justice Department’s eye. The combination of Internet Explorer was a camel-back and Microsoft settled in 2004. The investigation highlighted what internally referred to as “embracing, expanding, and extinguishing” (EEE) when the company said it. This penetrates new product categories, something familiar to Google’s competitors. Many vendors and their products have fallen – WordPerfect and SmartSuite – from using tactics designed to compete on price, expanding capabilities, then deliberately locking out users.

    Canon lenses as of 2021

    There is nothing to suggest that Canon behaves this way, although all camera manufacturers try to lock their consumers into proprietary lens mounts to increase lens sales, why are Third-party manufacturers like Sigma have reverse engineered mount specifications. However, in a similar way to open source, even this is changing with groups like the L-Mount Alliance.

    The future of Microsoft?

    So, does Canon have a future similar to Microsoft lying ahead? Microsoft’s fortunes are tied to changing its business model and adapting to new consumer markets, while maintaining its dominance in its traditional markets. This is true for Canon as it moves its broader business into the printing and related imaging industries, targeting larger business transactions rather than a direct-to-consumer market. .

    However, its DNA is made of cameras and here it is moving very fast to build a world-class mirrorless system that can last for a generation. And it is succeeding, which will pay dividends as the profits are clearly flowing from this technologically advanced sector. This strategy was highlighted when it closed its integrated camera production through the closure of the Zhuhai factory; the release of the first RF APS-C-mount camera raises questions about the future of the EOS-M series and its DSLRs in general. Canon is adapting and taking advantage of the changing landscape.

    So if Canon is the Microsoft of the camera world, who is the equivalent of Apple?

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