Most would believe that innovative and commodity products always exist in the same space. There certainly is innovation in the camera industry, and there are always people looking to pay for those innovations. But commoditization is about how the majority market view the products and the industry.
Therefore it comes down to whether customers see a distinction and value in the product advancements being delivered. If they do, then the market stretches beyond the base commodity level and customers willingly pay the premium. If they don't, because of cost or easy of use, then it remains a niche in the space until a time where is it either rendered obsolete because the market moves in a different direction, or eventually gets swallowed up in the commodity side of the business as a value-add.
For the camera industry, a good example of the commodity argument is small commercial applications. If consumers think it is sufficient to buy a residential camera system off the shelf at a big box, then innovations aren't really part of the conversation. Add in low cost manufacturers for the large commercial market pitching a comparable solution, and the innovations started having a real battle.
It reminds me of when I worked in the telco/ISP world when the phone and cable companies started competing using IP. The phone companies wanted to keep charging commercial pricing to small business customers, and those customers began to wonder why they had to pay so much more for what they perceived to be the same as what they got at home. Right or wrong, no technology argument was going to move these customers because in their eyes the question wasn't whether or not to have the latest features or reliability. What they experience at home was "good enough" for them at work, so that was all they needed to know.
Much like this example, the line is being re-drawn in the camera space between value (commodity) offerings and premium (innovate) ones, and the consumers for each are no longer just residential vs. commercial or SMB vs. corporation. The real question is where the line between markets is going to be re-drawn and how much of the market sits on each side.
Here, I am drawing the distinction that it is the suppliers who are unnecessarily, and somewhat destructively immediately cutting prices on innovations that people would pay for.
If there were only a limited number of players in the market, I would agree. But the camera market is so saturated that there are companies looking for any angle to take share. This competition comes in part because of the exponential hardware improvements throughout the tech landscape, driving down prices fast and allowing almost anyone a chance to get in on the market. Add in the fact that so many things have camera embedded into them, and now you have multiple, previously divergent, marketplaces innovating on the same type of product.
As someone who does not work in the camera space, what I see in this market is very similar to smart phones. There were great advances for years, and there continue to be today. But very quickly, prices dropped and the improvements from model to model "seemed" less revolutionary to the user. That is in part because the hardware is only as good as what the user does with it. That means that until software platforms can turn these innovations into something that advances the user experience in a significant way, the consumer will be less buying for "want" and instead only buy for "need." And that change in mindset is the epitome of commodity.
I would also add that the recent conversations on IPVM regarding selling direct is another example of a commodity market. When the product alone cannot protect a company's market share, then they start looking for alternate ways to protect their margins. And when the consumer isn't willing to pay for the value of those involved in the middle, then it becomes a quick run towards direct to consumer sales.
Surely the massive Chinese government orders have created the economies of scale that have made these things more affordable to a great number of buyers everywhere, no?
There are 2 big drivers for cameras over the past decade. Certainly, the Chinese government is one and likely we agree that the Chinese government has reduced prices overall, both by scale and their willingness to subsidize their major companies.
The other driver is the rise of consumer cameras (whether it is cameras on phones or action cameras like GoPro). For something like Ambarella (American company) who has been so key to the development of higher resolution, low light image processing, smart codecs, etc., they have been more driven by the consumer side (like GoPro, for good and now bad) than the Chinese government.
IP camera is running computers; product development is software programming work. It’s labor intensive, not capital intensive. We are short on labor resource here, so you see the Chinese advance, they have more engineers work on RD.
The American chip company Ambarella is certainly one. The sensor companies as well.
Axis was first with super low light (LightFinder), first with smart codecs (Zipstream), first with many different form factors, etc.
And Hikvision has some and is a fast follower and super aggressive at dropping prices.
But, from your implication that it is China/Taiwan/Korea that is innovating and not the rest of the world, is inaccurate. To be clear, when I say innovating, I mean first for new functionalities, dropping prices is disruptive but not in the sense innovation is typically used.
On the other hand, being owned by the Chinese government could be considered an innovation....
Invention is different than innovation. Innovation is when there is actually a major market impact, which [Canon's] financial results and overall production position shows that there has been little of.
So should we consider the first camera manufacturer ever with True WDR the innovator? Or the first one to be able to make it viable for the masses?
Certainly Avigilon has had > 29MP cameras for some time, so should we gush over 8MP resolution today? (Or maybe just that the frame rate is better.)
That's why, in my list above, resolution is conspicuously absent. I do not consider the jump in resolution to be as significant as the other items listed.
As for WDR, there are multiple innovations, the 'first' one (something like Pixim), and then other sensors developed for HD cameras, etc. True WDR is more widely available because sensor and chip manufacturers have innovative, true WDR is being sold for as little as $100 or $200 because of the price wars.
Even if you narrow it down to just the last year, there have been significant advances in super low light performance, plus sharp drops in bandwidth consumption (smart codecs), and broad availability of 4K / 12MP cameras.
In any event my question about "who do you think is innovating" was not loaded, I see both sides of the inventor vs. popularizer argument.
Cheap cameras today are about as good as expensive cameras used to be, and expensive cameras today are capable of things that would have been science fiction a few years ago. Take it from a guy who started out installing VCRs and multiplexors- this is an amazing time to be in this industry.