Market Watch

Smartphones Threaten Point-and-Shoot Cameras

New and improved cameras in the latest cellphones are giving camera vendors pause

October 31, 2011

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Entry-level point-and-shoot cameras are expected to suffer a decline in sales as a result of smartphone cameras becoming increasingly capable, according to an IHS iSuppli Home & Consumer Electronics report from information and analysis provider IHS.

Given their ubiquity factor, camera handsets have become one of the fastest-growing segments of the digital camera market, coming as a standard feature in smartphones and going any place where users take their handsets. Not only do camera phones fit today’s consumer lifestyles emphasizing device con­vergence and convenience, the biggest edge the phones enjoy over their point-and-shoot rivals today lies in the ease with which photos can be shared.

The point-and-shoots experiencing the greatest loss of sales to smartphones are the entry-level com­pacts, normally purchased by consumers only interested in posting pictures to sites like Facebook and Flikr, and for whom smartphone cameras are adequate for that purpose.  With social networks being the norm for how consumers communicate and share photos, mobile camera phones make sharing seam­lessly easy. And the difficulty in uploading photos from a digital still camera onto a social networking site absent a constant broadband connection means that smartphone cameras gain yet another advantage.

All told, cameras with built in Wi-Fi or Bluetooth are rare today, as shown by IHS iSuppli data. Only 3 percent of digital still camera units offered Wi-Fi in 2010, with projected levels growing to just 16.3 percent in 2015. Smartphones, of course, are almost always connected via their 3G/4G interfaces.

However, some caveats will keep phone cameras from completely killing point-and-shoot models. Most notably is the exclusion of the optical zoom lens in camera phones, as many consumers today con­tinue to yearn for the highest zoom lens available. And because photography enthusiasts care about image quality, the more advanced point-and-shoot models as well as digital single-lens reflex (DSLR) cameras will continue to be in demand with their better quality over that of camera phones. 

Overall, the cushioning effect of DSLR, 3-D and more advanced cameras has kept the camera space from declining further. The high-end point-and-shoot market will also continue to be around, even as smartphone cameras start  eating away at the low-end point-and-shoot space.

Apple Brightens Up the Smartphone Picture
With the introduction of the iPhone 4S, Apple Inc. presented one of the most sophisticated phone cameras on the market. In addition to an 8-megapixel BSI CMOS image sensor, which allows 73 percent more light to hit the sensor and improve low-light sensitivity, Apple has upped the ante with the lens, opening the aperture from f/2.8 to f/2.4.

Apple also included a hybrid infrared filter, which is intended to reduce the effects of chromatic aberration and ghosting often seen in small mobile sensors. Apple claims that the results in image quality due to improvements in the sensor and lens will make it possible to print pictures as large as 8-inch by 10-inch pixel for pixel. The video capabilities of the iPhone 4S also have been enhanced from 720p to 1080p HD at 30 FPS, which brings Apple up to par with most Flip-style recorders. To top it off, digital image stabilization and temporal noise reduction have been included as well.

Other smartphones also are seeing increased capabilities, such as in HTC’s recently announced Titan and Radar, which both sport cameras with f/2.2 lenses. The HTC Incredible and Motorola’s Bionic An­droid likewise sport an 8-megapixel sensor, matching the new iPhone’s spec in this area. 

Learn More > Image Sensors: Will Smartphones Rival Point-and-Shoot Cameras? 

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