Canon, Uninnovative, Struggling For Years

Author: John Honovich, Published on Feb 11, 2015

Canon has gone from nothing to arguably the most powerful video surveillance manufacturer in 8 months.

All they had to do was spend $3+ billion USD to get there.

***** ** ***** ****** ****? *** *** **** ***** ** their ******** **** **********?

*** ****** ** ****** ***. ** **** ****, ** ******* Canon's **** - **** ********** *** *** ******** **** ****.

*** **** * ***** **** ********* ********* ****** *** ******** electronics, ** ******* *** ***** ******* *******. ***** *** *** been **** ** *********** ** ****.

******, **** *** **** * *****, ******* *** **** **** have **** **** ** ****:

*** *******, **** ** $** ******* *** ******* ** *** down ** *** $** ******* *** *****.

*****'* **** ******** ***** *** ****** ******** (~**% ** *******) and ******* ******* (~**%).

** *******, ***** *** **** **** ** **** *** *** past * *****:

** * ****** ** ****, ***** ****** ******* ******* ** their '******** *** ****** *****', ***** *** ********* **** **** over *** **** * *****. *******, ***** ** ********* ******* ***********,

"** *** ******* *******, ** ******** *** ******* ****-** ** launching *** ******** **** *** ******** *** * ******* ** indoor ************ ** *** *** ** **** *** ******** ***** results **** ************* ************ *** ****** ** *** ******."

**** ** ****** *** ** ********* *** **** ***, **** importantly, *** **** ****, **** ******* ********* ******.

*******

************, *** * ********** *******, ***** *** ******* ***** ** the ***** ******* *** ***** **** ***********, ******* ******** ********** competitors **** ******* *** ***** ******* ****** *** **** **** period.

** *** ****** ****, ***** ********** ****:

"****** *** ***************-**** ******* ******* ********* ** **** ***** ********** due ** *** ******** ********. ** *** ******* ******* *******, demand ********* ** ****** ** **** ********* ********* *** ******** markets."

***** *** ****** ****** ** ******** ** **** **** *** obvious *** ********** ***** **** **** *********** ******* ** ******** devices / ********** / *******. ** **** ***** *** **** with ****, *** **** ***** ****** ** ** ** ***** the ********** ** ************ *** *****?

Innovate **** **** *** *********?

***** ** ***** ***** ******, ** ** **** ** ********** why ***** **** ***** ********** ***. *** ******* ******* ** be ********** ****-****** *** ****** ** **** ******* *** *******.

*** ***, **** **** ****** **** * ****** (** ************) whose ****** **** ** ************* ********* *** *** ** ***** attack ** ***-**** ******* ************* **** **** ***** ** ****** against.

**'* ********** ** ******* **** ***** *** *** **** *** Milestone***************** *********** **** *** *** *** **********.

*** *** *********** ** ** ***** *** *** ******** **** a '***** ********', ** ******** *****-******* *** *** *********** *****. But **** ***** ****** **** **** * *** **** ** trying ** *** *** *** *******? *** **** ******** ********* such * ********* *** ******* **********?

** ***, *** ********** **** *** **** ** *** *** two *************, ***** ** ** ********** ************ ***** ** **, but ***** ** **** **** *** **** ******* ** ***** for *** **** * *****.

Comments (10)

"Demand for interchangeable-lens digital cameras continued to face harsh conditions due to the economic slowdown. As for digital compact cameras, demand continued to shrink in both developed countries and emerging markets."

Canon was simply unable to innovate to deal with the obvious and inevitable shift away from traditional cameras to Internet devices / smartphone / cameras. If they could not deal with that, how does Canon expect to do so given the challenges IP surveillance now faces?

Dealing with it would be one thing but they don't even seem to acknowledge the change in technology away from compact cameras and DSLR cameras to mobile device cameras as you mentioned. Sure there will most likely be a small market for those devices but the overwhelming majority of people will use their mobile device over a standard digital camera.

Will this be a pattern with their share of the surveillance industry? How will they adapt to the continuous changes?

The Japanese was the king during the analog age, but currently, they have lost in the digital evolution. IP cameras are based on SOC (system on chips), which requires the rapid development of both hardware and software. It is high tech labor intensive, and Japanese doesn’t have the labor resources to compete.

What else would Canon need to do to become nigh unbeatable, besides execute this properly? These seem like big moves now that the picture is coming into focus. Would adding analytics and a more fleshed out access control product make them a real direct threat to Avigilon? Would having access to lower end product (Axis is not cheap) do it? Burglar alarm (yawn)?

Clearly they are willing to drop the cash, may as well go for everything now before someone else reacts quicker.

Austin,

Analytics and access control would make sense if they are building a solution, though it remains to be seen if and when Canon is going to sell even Axis and Milestone as a solution.

To get the Avigilon benefits, there needs to be a tight coordination / integration of sales and marketing as well, which won't happen if both Axis and Milestone remain independent.

I do think a super Avigilon solution would be a strong play for Canon, if they are willing to put it together.

Consumer compact cameras business is declining like crazy for the last 2 years down to 50% from where it was in 2012. Smart phone is one reason for the loss. You cannot expect imaging companies to produce phones or tablets to cover up the loss. It is not their business. Companies like Canon and Nikon have been hit hard. When you examine the graphs above, Canon has coped with it pretty well. Now they are trying to recover by moving their focus to different product groups they have.

I wonder how the uptick in dSLR has offset the loss in point and shoot. Anywhere close to a wash, or more like saving the Titanic with a leaky bucket?

John,

I think you are right on the mark here. "Super Avigilon" will not be easy to pull off. Canon is in need of a strong U.S. CEO who has experience in the industry and has led a Japanese company. That person would need to assimilate Milestone and AXIS and that includes cutting redundant management. Very few candidiates like this but they are out there. Independant companies running simultaneously in this case is a doomed strategy.

John,

I don’t think you’re seeing the potential here. Let’s consider what might be (hypothetically) possible.. First off, Ray Mauritsson no longer needs to report to those shareholders (or worse, those pesky customers). Now he can report to somebody in Japan! He’ll have lots of additional meetings and presentations to give, all the while being under the gun to deliver sales and revenue. If Ray doesn’t work out, then maybe it’d be good to replace him with somebody a little more engrossed in Canon’s culture. Speaking of Canon’s culture, of course it’s so much larger, mature, and sophisticated than the Axis way of doing business no doubt Axis can benefit from their supply chain practices, project management, and product management processes. The middle management at Axis has so much to gain from those 3AM conference calls and will probably need to put together another slide deck for that meeting.. Of course, if there are hiccups it might be due to Axis not really understanding how Canon works, and more meetings, maybe even moving some people around might be in order. Speaking of moving people around, there’s probably a lot of redundancy in the services provided by IT, HR, finance, marketing, product support, and oh yeah, supply chain & manufacturing. If Axis can save money by using Canon’s services, it will go straight to the bottom line! So those can probably be consolidated—smooth as silk. And given the cost of real estate these days I’m sure some physical facilities should be consolidated too—moving is a highly productive activity. When the dust settles the opportunities for sales synergy are endless. For example when a Canon dealer is closing on a RadPRO D2-50RF Dynamic Digital RF Radiography and Fluoroscopy machine he can sell some IP cameras too! Because of course there’s no reason they can’t go to market the same way (since they both use electricity), and if you squint a little the customers look a lot alike (mostly humanoid). I’m happy for Axis AND Canon in this deal.

Invention is different than innovation. Innovation is when there is actually a major market impact, which their financial results and overall production position shows that there has been little of.

Login to read this IPVM report.
Why do I need to log in?
IPVM conducts unique testing and research funded by member's payments enabling us to offer the most independent, accurate and in-depth information.

Related Reports

Axis: "No One Wants To Buy A Camera" on Nov 09, 2018
Axis has, in its own description, made a bold declaration: The industry is changing so rapidly that the following statement might seem bold but...
Resideo IPOs, Then Plunges on Oct 31, 2018
ADI and Honeywell Homes management have been touting their spinout and IPO for months, including appearing on Wall Street as they widely shared on...
Axis Strong US Growth, Flat EMEA - Q3 2018 Financials on Oct 18, 2018
This spring, Axis had its best financials in many years (see Axis Strong Q2 2018 Results). However, over the summer, Axis had many products sold...
Knightscope Winning Investors, Struggling With Growth on Oct 16, 2018
While Knightscope's new financials show the company only winning 11 new customers in the past 12 months, the company continues to win new...
ADI's Financials Revealed + W-Box Growth Priority on Oct 15, 2018
  ADI is one of the most powerful distributors in the security industry but how big are they? How much profit do they make? How much do they sell...
Genetec Takes Aim At 'Untrustworthy' 'Foreign Government-Owned Vendors' on Sep 24, 2018
Genetec is taking aim at 'untrustworthy' 'foreign government-owned vendors'. This is not a new theme for Genetec as nearly 2 years ago, Genetec...
Ascent / MONI Faces Lender Lawsuit and Debt Crisis on Sep 13, 2018
ASCMA, aka Ascent, aka Brinks Home Security, aka MONI, aka Monitronics is being sued by a group of their lenders who allege: As of June 30,...
Arlo IPO Filing Reveals Key Financial and Competitive Details on Jul 09, 2018
Arlo is going to IPO at a projected valuation greater than Axis. Now, Arlo has released their 175-page Form S1 Registration Statement for its...
ASIS GSX Show Struggling Getting Exhibitors on Jun 26, 2018
The show formerly known as ASIS, now GSX, is less than 3 months away. And it is struggling to get exhibitors to go back to Las Vegas, just...
Hikvision Covers Up Racial Profiling And AI Error on Jun 25, 2018
Faced with global scrutiny, led by the US government-funded Voice of America (VOA), Hikvision has covered up evidence showing their racial...

Most Recent Industry Reports

'Sticker' Surveillance Camera Developed (CSEM Witness) on Nov 16, 2018
The Swiss Center for Electronics and Microtechnology (CSEM) has announced what it calls the: world’s first fully autonomous camera that can be...
ISC East 2018 Mini-Show Final Report on Nov 16, 2018
This is our second (updated) and final show report from ISC East. ISC East, by its own admission, is not a national or international show, billed...
Facial Detection Tested on Nov 16, 2018
Facial detection and recognition are increasingly offered by video surveillance manufacturers. Facial detection detects faces in an image/video...
Throughtek P2P/Cloud Solution Profile on Nov 15, 2018
Many IoT manufacturers either do not have the capabilities or the interest to develop their own cloud management software for their devices....
ASIS Offering Custom Research For Manufacturers on Nov 15, 2018
Manufacturers often want to know what industry people think about trends and, in particular, the segments and product they offer.  ASIS and its...
Hikvision Silent on "Bad Architectural Practices" Cybersecurity Report on Nov 14, 2018
A 'significant vulnerability was found in Hikvision cameras' by VDOO, a startup cybersecurity specialist. Hikvision has fixed the specific...
French Government Threatens School with $1.7M Fine For “Excessive Video Surveillance” on Nov 14, 2018
The French government has notified a high-profile Paris coding academy that it risks a fine of up to 1.5 million euros (about $1.7m) if it...
Integrator Credit Card Alternative Divvy on Nov 13, 2018
Most security integrators are small businesses but large enough that they have various employees that need to be able to expense various charges as...
Directory of Video Intercoms on Nov 13, 2018
Video Intercoms, also known as Video Door-Phones or Video Entry Systems, have been growing in the past decade as more and more IP camera...
Beware Amazon Go Store Hype (Tested) on Nov 13, 2018
IPVM's trip to and testing of Amazon Go's San Francisco store shows a number of significant operational and economic issues that undermine the...

The world's leading video surveillance information source, IPVM provides the best reporting, testing and training for 10,000+ members globally. Dedicated to independent and objective information, we uniquely refuse any and all advertisements, sponsorship and consulting from manufacturers.

About | FAQ | Contact