Japan’s Canon has said it is focusing more on expensive cameras, printers, and even flat screen televisions as the demand for digital compact cameras in Europe is slowing.

Last year saw digital camera sales in Western Europe increase 58 per cent to just over 25 million units, but while that growth may slow to 25 per cent to 30 per cent amid continued price pressure, the market for more advanced digital Single Lens Reflex (SLR) cameras will double by the end of next year, it said.
“This year there will be something like 25 per cent to 30 per cent unit growth for the market. In the worst case there could be no real value increase (due to price pressure). But we still have a positive outlook on Canon’s position,” Canon’s European chief of Consumer Imaging, Mogens Jensen, said in a Reuters interview.
“We predict the digital SLR market will double in size by the end of 2006,” he said, adding that this would be largely driven by the company’s new SLR camera for photo hobbyists.
While those types of cameras only represented one-thirtieth of the total digital camera market last year, according to market research group IDC, it is a much bigger portion in value terms and profits as SLRs devices sell for around 1,000 euros.
The strength in high-end cameras was one of the reasons Canon reinforced its leading position in Western European digital camera sales, capturing a 16.8 per cent market share in 2004, up from 16.2 per cent in 2003, IDC said.
Sony is No 2 with 14 per cent, Olympus No 3 with 12.5 per cent and Nikon No 4 with 10.4 per cent.
Pressure on prices was severe last year, with an overall price erosion for compact digital cameras of over 15 per cent. The Japanese and American markets, which had adopted digital photography earlier, slowed down ahead of Europe and large batches of older products were shipped to Europe.
“Last year a lot of companies had excess stock. What usually happens in such a case is that they move it to the strongest growth market and dump it,” Jensen said.
Because it had no inventory to burn itself, Canon could sell “fresh” products and maintain profit margins, Jensen said.
Canon’s European sales, including faster-growing regions like eastern Europe, increased 12.6 per cent to 1,091 billion yen ($10.40 billion), and passed the Americas as Canon’s biggest geographic market.