Camera phones to wipe out low-end digital camera market

Within two years, inexpensive camera phones will take much of the market share now held by low-end standalone digital cameras, according to industry analysts ABI Research. The company believes it has identified the drivers for camera phone growth, how mobile imaging will evolve, and the reasons why camera phones will eventually displace portions of the standalone digital camera market.

We believe that within the next two years, the quality of a mobile phone camera will be such that people won't need low-end standalone digital cameras, said Kenneth Hyers, principal analyst of global wireless operator research at ABI. This will dramatically impact camera sales.

Within a short period, said Hyers, the typical 1.3 megapixel camera phone will be ubiquitous, and 5 megapixel models will not be uncommon. We are in the midst of a megapixel race,he said, and by early 2006, 1.3 megapixel models will outsell VGA camera phones; in the following years, two-, three- and four-megapixel devices will replace the lower specification models.

At the higher end of the range, the rest of the camera phone components grow in importance. The race for market share then turns away from adding megapixels to providing better lenses, more accurate zoom capabilities, and much better image analysis and management software.

Certain manufacturers, such as Motorola, are targeting the low end of the market, which is fine for getting enough inexpensive devices out there,: said Hyers. But you've also got to have some higher-end models with greater resolution and better lenses, such as models being produced by Sony Ericcson, Samsung and Nokia, which establish them in consumers' minds as makers of prestige, high-quality imaging devices.

ABI Research adds a cautionary note though, stressing that camera phone vendors need to provide improved imaging and picture-management software, as well as larger storage capabilities. Also, operators around the world need to ensure widespread MMS interoperability. No mention of the cost of sending pictures over mobile networks - but we all know this is ludicrously high and needs to be reduced significantly.

05.09.05
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