– Thoughts on Strategy and Management

Strategy, Sony and the DSLR

OliverA couple of weeks ago I posted my concerns about Sony and its DSLR business activities. This week “Sonys camera strategy” was presented in a German PC Magazin “CHIP” (June special edition “Foto Video digital” 2007). Takashi Kondo (Vice President Digital Imaging Sony Europe) explained some of Sony’s business concepts. According to him Sony regularly reviews both, Sony-customers as well potential customers (“non Sony Customers”) and their demands for camera features. Furthermore Mr. Kondo informed that Sony did achieve the third position in the DSLR business segment; Canon and Nikon would hold the first and the second place. “We need to further solidify our position in the digital SLR market. To do that, we must cater to varying degrees of customer requirements, and we are working on the second wave of products in order to expand the world of ‘α’,”.

That’s not bad, isn’t it?

Two new DSLR bodies would be introduceed to the market in 2008; they are intended to help Sony to become the number two or even number one in the market. He sees Sony’s DSLR activities as to be slow on the uptake; hence Sony would introduce unique features for the new camera bodies. Other indices within the interview were that the new flagship would be likely to have a full format sensor and would use CF cards as memory.

Well, I am little bit more confused than last time; but let us start with the good news.

It is good to know that Sony will introduce two flagship models above the existing alpha 100. I think it is crucial to offer an appropriate range of DSLR bodies; ranging from an amateur camera model up to cameras for semi/professional use. This approach can transfer image and reputation from the top product to the lower end products. 106 million digital cameras have been sold worldwide in 2006. Yes, Sony has achieved the third place. Its market share is 6,2 % within the DSLR segment. These were the good news.

The “bad” news? I assume that Mr. Kondo knows that data. Canon is the market leader with 46,7 %; the second place belongs to Nikon with 33 %. Place four? Olympus with 5,9 %. (Note: All figures are from IDC). Hence Sony is more likely to compete with Olympus rather than with Nikon or even Canon in this business segment.

So how does Sony want to achieve the second place? With a full format sensor? Basically that is an excellent idea; however Canon already offers this type of sensor in the EOS 1-DS Mark II. The hardware integration of CF card as memory medium is more a basic requirement. As we know from management and marketing research it is essential to fulfil those basic requirements. In the case that they are not in place, they will cause dissatisfaction. The CF option is more a “has to be there” than anything else.

What is left? The “unique features” that are not available in the market place so far….I am looking forward to see them.

In summary I am little bit disappointed:

  • Sony is a large company with huge resources. In 2006 Sony introduced the Alpha 100. Not until 2008 it will introduce two models above the Alpha 100. Some essential accessories (e.g. battery grip) are still not available. Basic requirements within this market segment have not been considered enough. Customer lock-in options have not been used; the current memory stick preference is more a lock-out feature.
  • 2008 is quite late in terms of competition. It might be that the alpha 100 has been some sort of a trial balloon in 2006. Due to the third place in the market with just one model in competition Sony might have decided to extend these business activities. But we should also consider that Sony buyers got the chance to use their Minolta lenses; it might be that this feature has been the only reason for them to buy the Alpha 100. The longer Sony needs to offer a complete product range, the less important this “lenses aspect” will be since more and more former Minolta-customers will switch to another brand.

At the end of the day I still have some serious doubts that Sony will be able to become number two in the market place with its current business approach.


This is the official press release from Sony (14 March 2007)“Sony is Set to Expand the World of “alpha” D-SLR

At the PMA2007 International Convention and trade Show which was held between March 8th and 11th in Las Vegas, Nevada, USA, Sony exhibited two prototypes of digital SLR camera bodies and interchangeable lenses currently under development. These products are planned to be launched in addition to the existing portfolio of the ‘alpha 100’ camera body and the 21 interchangeable lenses including Carl Zeiss® lenses and more than 45 pieces of accessories..

“We need to further solidify our position in the digital SLR market. To do that, we must cater to varying degrees of customer requirements, and we are working on the second wave of products in order to expand the world of ‘’ alpha,” said Toru Katsumoto, head of Sony’s AMC division responsible for digital SLR products, when speaking at Sony Electronics Inc.’s press conference. “Specifically, we are developing two new camera bodies targeted at higher market segments compared with the ‘alpha 100’,” he added.

The extended line-up is expected to give customers more options and allows them to trade up products as their skills mature. The second wave of products also includes interchangeable lenses suitable for high-end enthusiast and professional use. “With the added choice of camera bodies coupled with enlarged interchangeable lens portfolio, we believe ‘alpha’ helps our customers spur their creativity and putting it differently, ‘alpha’ unlocks the full potential of digital SLR,” Katsumoto concluded his speech.

Reinforced ‘alpha’ Portfolio
One of the prototypes displayed at the PMA2007 was a camera body positioned higher than the current ‘alpha 100’ to appeal to high amateur users. This new camera will deliver a high picture quality drawing on a new image sensor and new BIONZ image processing engine, both of which are currently under development. The new camera will also feature ‘Super SteadyShot inside.’ Already implemented in the ‘alpha 100,’ this optical image stabilisation system is effective with the full range of ‘alpha’ system lenses.

The other camera body prototype will represent the flagship model of the ‘alpha’ range. Offering features that meet demanding requirements from even professional photographers, this highest-end camera body also incorporates a new image sensor, BIONZ processor as well as ‘Super SteadyShot inside.’
One of these two new cameras is scheduled for launch during this calendar year.”


  1. Thanks for the update on the Sony product line. I anxiously await the upper level bodies from Sony. I like the a100 but I was hoping for a unit that had a more substantial feel to it. I had been a Minoltaholic since the ’70’s and was really looking for a higher end unit to be brought to the market sooner. Sony please hurry we old time Minolta users are dying for the high end units. Thanks.

  2. Pingback: Sony A100 dSLR: Time to kill the Memory Stick myth : Alphatracks

  3. Response to the pingback “time to kill the memory stick myth”





    Dear Tom Bonner,

    I have read your post. As a former Minolta owner I have to make some statements for clarification, since I think there is a bit of a misunderstanding: I am well aware that Sony already offers the option of using flash card memory. It was not my intention to suggest that they don’t offer CF cards (e.g. ‘memory stick preference’ does not mean that there is nothing else. It only says that they have preferred this option in the past). However, my post doesn’t discuss the features of the existing product line. All I was trying to say was that this is a basic feature and a must have for all high end DSLR cameras today. It is not something with which to differentiate from competition.

    Don’t get me wrong, but you did not meet the point. Mr. Kondo argued (within the referenced interview) that the NEW FLAGSHIP CAMERA BODIES would be likely to have a full format sensor and would use CF cards as memory. Hence I was referring to Sonys latest announcements about features of their product lines to come. These features will be, among others, CF cards for memory.
    Would you argue that these features represent competitive advantages? Would you argue: “Buy this camera body, since it uses CF memory” ? As your post also indicates, CF memory is an essential feature. It is not unique in the market place. Hence it is not a competitive advantage; Sony HAS to offer – like in the A100 – the CF memory function. It is not a feature to distinguish Sony against it competitors.

    Of course you can use your memory stick in the A100. Let’s assume you have had a 4MP digital camera from Sony and an appropriate 256 MB stick (makes app. 120 pictures in high resolution in your 4MP). If you want to store your A100-photos in JPEG and RAW at the same time you’re bound to buy a larger memory stick or even a (new) CF card.

    Your idea “Buy a Sony A100 and get a free Sony brand Compact Flash card” promotion” sounds nice. Unfortunately it is just a copy of what already happens in the market place. Currently Canon and Nikon have started cash back promotions in Europe to increase their market share.

    Does Sony employ a sound strategy? I can not agree. Who will be justified? So, let’s observe the market share in the DSLR business for Sony….