Refocusing on Digital Cameras

Does anyone out there still use film in his camera? Photo film, like typewriter ribbon, television antennas, and leaded fuel, has been reconciled to the dusty storage room of history where all once-cutting-edge technology seems eventually to land. Some diehards still insist on clattering away on their old Remingtons or tooling around the countryside in their vintage Packards, but the rest of us have moved on.
In fact, the digital camera conquest of the consumer photography business has been near-total, as the numbers demonstrate. An April, 2008, report from Forrester Research (FORR) claims more than 6 out of 10 individuals in the U.S. owns a digital camera. There are several reasons behind this rise. First, digital cameras have become easier to use; second, thanks to broadband Internet penetration, more users are able to upload and share their photographs online; and lastly, digital cameras have become a lot cheaper.
Sales Level Off
That's good news for consumers, but it presents a problem for camera makers. Like the computer, another popular device whose success eats into its profitability, digital cameras are in an increasingly mature market, as it nears maximum penetration and its rate of growth slows. (Not to mention increasing competition from constantly improving cell-phone cameras.) The trick now is to enter new markets as well as develop new technologies that will keep existing users coming back.
According to Chris Chute of research firm IDC (IDC), we will "see a gradually maturing market where sales growth gradually levels off—at about 35 million units per year in the U.S., as opposed to 38 million in 2007." He also points out that in 2007, 131 million units were shipped worldwide. This represented a 24% growth rate, compared with 15% in 2006. However, this was a reversal of the trend that has seen the digital camera market experiencing a slowing rate of growth over the previous three years.
He attributes the unexpected jump in sales growth in 2007 to a higher churn rate than anticipated—it seems a consumer digital camera's life span is probably about two years, a lot like the mobile phone, and people replace them on a regular basis. He doesn't expect this to change much, "because at these prices the cameras won't be robust enough to last more than a couple of years anyway."
DSLR Growth
But one subsector of the business has picked up the slack from the now-ubiquitous digital compact camera and is providing the double benefit of stellar growth and fatter margins for the producers—digital single lens reflex cameras, or DSLRs.
Although DSLRs capture only 8% of the global market, according to IDC, their sales grew at a 41% clip last year, almost twice that of digital cameras as a whole.
This is being driven by second- or third-time buyers who are upgrading from point-and-shoot cameras to these more sophisticated models, what the industry calls "prosumer" DSLRs. With an average price of about $800, fatter margins, and a healthy accessory market, DSLRs have really been a boon to manufacturers, particularly Canon (CAJ) and Nikon (NINOF).
Margins are helped by the fact that Canon and Nikon do not need to develop new technology for consumer DSLRs—they just adapt technology originally developed for their professional DSLRs, so these $750 to $1,500 cameras represent a very lucrative business, even if the number of total units shipped is still relatively small.
Shifting Demographics
Originally, it seemed men were pretty much the only ones sporting these status symbols around their necks. But according to IDC's Chute, in the last year the demographics have started to shift toward women as manufacturers have put a lot of effort into producing smaller and lighter models, such as the Nikon D60.
As the compact digital market has matured, cameras have become more alike, boasting the same features that vendors have figured out users want. As Brian O'Rourke, an analyst at Phoenix-based high-tech market research firm In-Stat, points out: "As sales have grown, the photographic knowledge of the typical user drops. It's not the hobbyist area it was six years ago."
Narrowing Choices
So with summer arriving fast, if you're thinking of buying your first digital camera, replacing that old four-megapixel number with the balky flash, or even upgrading to a fancy DSLR, take a look at the accompanying slide show—there is something for everybody there.
We looked at and tested a wide range of cameras from entry-level compact to consumer DSLRs and picked the best, in terms of image quality, features, and usability at a range of price points.
So, whether you're looking for a rugged point-and-shoot to take on the Appalachian Trail (the Olympus Stylus 1030SW) or a DSLR that can capture your kids' sporting achievements at three frames per second (the Panasonic Lumix DMC-L10),

Apple’s iTunes Becomes the United States’ No. 2 Music Retailer

By Raymond Fitzmyer
According to market research firm NPD Group’s recent announcement, it seems that Apple’s iTunes became No. 2 music seller in the United States, just behind Wal-Mart Stores. The market research company based its recent report on measures of retailers’ volumes of sales.
NPD Group said on Tuesday that Apple’s popular online music store reached the second place thanks to the large amount of music it sold in 2007. NPD Group started tracking music sold in the United States during the middle of 2006 and in the fourth quarter of that year it was Best Buy, not Apple’s iTunes, on the second place behind Wal-Mart Stores. iTunes was neither on the third place, which was taken by Target Corp. Apple’s online music service came only on the fourth place.
But in 2007, things changed and Best Buy took the third place and Target Corp. the fourth, while iTunes became No. 2
NPD Group’s analyst Russ Crupnick said this change was “fairly understandable given the pressure that’s been on CDs and the almost 50-percent growth in digital downloading in the past year.”
But the market research company’s recent report brought us also other interesting data to think about: the company showed, for example, that in 2007, almost 10 percent of music acquired in the United States was bought through legal downloads. During the same year, the number of consumers that bought digital music through legal pay-to-download web sites increased by 5 million to 29 million.
NPD Group also announced that the amount of music people bought in the United States rose 6 percent during last 2007.
In morning trading Apple’s shares fell $2.55 (2.1 percent), while Wal-Mart Stores’ shares rose to $51.14.

Skype 101

Skype is the most popular technology for making long-distance telephone calls over the internet. The internet relies on telephone lines, so using a computer equipped with a microphone and speaker instead of a telephone handset is not particularly technical for users.
Or beneficial -- by itself, the only benefit to simple internet telephony is tolls. Skype is free -- but only once you've paid for a computer and broadband internet access. Sound quality is often worse than traditional telephony and it is not as convenient as picking up a phone and ringing overseas.
But there's much more to Skype than telephony, especially conference calls, video calls and the current nirvana -- conference video calls.
My wife and I have been using video Skype to stay in touch with family overseas for about two years. Using a webcam (web camera), it's great to see my parents in Canada and mother-in-law in England -- if only to judge how they are getting on as they get on.
And, of course, they get to see their grandchildren as they grow up. My father-in-law has read nursery rhymes and other children's stories to his grandchildren using Skype video calls from overseas, which is magical.
Skyping requires some technical ability at both ends. My parents -- either side of 80 and happy Apple Mac users -- prevailed on a friend's son to get Skype working for them. My father-in-law built a home computer back in the 1970s, so doesn't need any assistance.
There also has to be interest. My brothers and sister have shown no interest in Skyping, despite apparent ability, while my wife's family engages in regular conference calls between New Zealand, California, Canada and Britain.
There's little point in running through a Skype download and set-up in this article. The instructions and troubleshooting at www.skype.com are straightforward.
But there are things worth noting. First, the Skype website is jammed with ways to send the company money. Ignore these -- we've never paid Skype anything and don't think the extra services that cost money are worthwhile.
You'll also find Skype software packages for sale in stores and online. Buy these only if you insist on paying for what is free. You'll also see Skype-optimised webcams, headsets and microphones for sale. Don't pay premiums for these items.
You'll need: an up-to-date computer, which will have the grunt to handle sound and video. You also need a microphone, speaker and webcam for video calls. Most recently bought laptops have built-in webcams and microphones and speakers. Our laptop isn't recent, so we rely on an external webcam and headset with microphone and earphones. Desktop computers may have built-in equipment as well.
Once you've got Skype running, you may get friendly requests from strangers. Our Skype is registered in my wife's name and sometimes strangers, especially Indian men, want to chat with her. She declines.
Skype is not the only company offering video and telephony over the net. Yahoo, Microsoft and others also offer the services. For the time being, however, calls are proprietary. So, you make a Skype-to-Skype call, or Yahoo-to-Yahoo call. I don't know when you'll be allowed to make a Skype-to-Yahoo call.
Fortunately Skype comes in discrete chunks that make scaling up in sophistication pretty easy. First, master simple telephony, then move to video calls and then to video conferencing, which is not yet available from Skype, but will be down the track.