Leica -- Focusing on profit

In case you missed it, here is Leica's business strategy, as told by Andreas Kaufmann:

 

They will sell gasoline as long a crude can be mined, but the end is coming. Same for film. Might be a decade, might be

two or three. Wait and see.

That's a total fluff piece. Their strategy is to make 'special' digital cameras and to be profitable? That's not a strategy! They are doomed.

You all have a sad an pessimistic view.

that should be AND not AN

I agree Andrew. I'll believe it when I see it. Having worked for a couple of major brand companies, it was laughable the rumors I would hear, when I knew the opposite was true.

Judging by the number of us Leica photographers at the LHSA meeting in Louisville, who, in addition to our M6s, M7s, MPs, and M8s, were also packing the little D-Lux3 in our pockets (and using them), Leica's digital products are a big hit. And the new S2 (it does exist--I held one) is a formidable professional tool. I spoke with Dr Kaufmann there. He's very smart. I have the impression he has the company on the right track.

The S2 is meant to compete with the Hassy H3 I think it's called. There price point is similar (read atmospheric), but the Leica will have to put out a pretty good camera to compete with Hassleblad in that somewhat limited market. I suppose they will be going for high end commercial and fashion spread photogs...maybe landscape too eh?

"The S2 is meant to compete with the Hassy H3 I think it's called."

 

"...I think it's called..." that certainly gives one confidence that you know what you're talking about...

 

"There price point is similar (read atmospheric), but the Leica will have to put out a pretty good camera to compete

with Hassleblad in that somewhat limited market."

 

Atmospheric is relative to the amount of money you generate with the equipment. So you actually know the size of

the market? Really? ...and you're figuring Leica doesn't? I would question the statement since Leaf, Phase One,

Mamiya, and Sinar all have digital medium format camera systems - not just Hasselblad.

 

BTW - the Mamiya DL28 is $15K with lens, the Hasselblad 503CWD is $13K with lens, the H3DII-31 is $18K, the

Phase One 645-P21 is $14K with a lens - hardly "atmospheric" if you compare the prices to the Canon 1DS at $7K

without a lens.

 

However, the performance / price point for the S2 is against 39 megapixel cameras. Meaning it has to be

competitive against the Hasselblad H3DII-39 that retails for $22K with an 80mm lens. Phase One was running a

special earlier this year for their 645 with a 39mp back and three lenses for $30K.

 

Dr. Kaufmann has said Leica understands that they have to be price competitive with existing products - meaning

even if it's a Leica, you have to be in the same price range area. I would expect there will be some premium because

the camera has a variety of features not available on other medium format cameras - and Leica lenses.

 

"I suppose they will be going for high end commercial and fashion spread photogs...maybe landscape too eh?"

 

How about any use that requires a weather sealed medium format digital camera - since none of the other digital

medium format cameras are weather sealed? The lenses are faster giving better depth-of-field control and allowing

higher shutter speeds when required. The body has a focal plane shutter and some of the lenses will have leaf

shutters giving a lot of shooting variations to match conditions.

 

The camera is a very nice package that is not much larger than the Nikon D3 or Canon 1DS but will have far better

image quality because of the larger sensor. Leica already has a waiting list for the camera if that's any indication of

the interest in the product.

If Leica keep acting and thinking as they do, they're doomed.

 

They still didn't understand the digital market.

It's an old video.

First of all, on the contrary to the M8 series, the S2 system is technically promising...

 

To know how broad its market will be is another question.

 

For me the idea to use a somewhat larger sensor and get the image quality of a medium format digital camera on a camera not much larger than a small format DSLR is sound, provided the camera will combine ALL the advantage of both formats. Point in case, will the S2 keep the high ISO performance which is now available to the professional and serious small format DSLR users ? In which case it is potentially the near universal camera system generations of photographers hoped for, or will it be more comparable to the existing medium format performance in this particular domain in which case, the competition will be limited to the medium format market.

 

IMHO, the market and the eventual outcome of the S2 as a commercial success might be entirely dependent on this question...

 

If Leica glass is unquestionably superior to most if not all the other brands' glass in small format, I sincerely doubt it will be the case facing the Zeiss conceived lenses of an Hasselblad system (even the old C lenses I was used to were extraordinary)... Leica nuts should not be blinded by their unconditional faith in Leica glass and hope for the same attraction from medium format users a Leica lens can obtain from a small format user.

 

Comparing the price of an Hasselblad "kit" with the standard lens as a premium for the buyer and the one anticipated to access to an S2 and a similar kind of lens is stretching the things too far if the S2 is not the kind of "universal" machine I described earlier.

 

Consider the potential professional buyer of the system : it is true - as Steve said - the appreciation of the price will be established taking into consideration what the camera system is able to return (I'll add in a reasonable delay). But the expense is not the same when for example a Hasselblad user, already having a bunch of Hasselblad glass, upgrade to a new compatible body and the price he will have to pay to switch to the S2 system... You should have to add to the body a whole set of VERY expensive lenses as the mount is exclusive to Leica S2. I'm not sure this expense will be considered profitable by a sizeable number of potential customers in the event the S2 cannot replace TWO systems at once (a medium format one and a small format one) while keeping the essential qualities of both (including the high ISO performance of the latter).

 

Notice also the digital medium format world is now turning more and more toward inter-compatibility like it was the case in film times for the large format. Mamiya - Phase One new platform does accept both Hasselblad and Mamiya 645 series lenses for example (including old manual focus lenses), so the competition tends to concentrate on the bodies... I'm not sure the proprietary approach of Leica with the S2 will be considered favorably in such a context.

 

What will be the reactions of the other MF brands to the S2? I assume most digital MF are today largely overpriced (much more than with a consumer grade small format camera) considering their actual production cost. So there is room for a decrease in retail price. I don't think it is really the case with all the R&D cost implied by the S2 body and the associated new lenses...

 

I do hope the S2 won't be part of the sad kind of products which are technical marvels but commercial failures. Let's see what is its actual performance, in the end it is its ability to replace both a small format and a medium format system which will lead to a success or a failure. And that means the sensor technological breakthrough which consists in having a very high definition through a high number of megapixels without sacrificing (very) high ISO performance without excessive noise should be already present in this body.

 

Leica has decided to bet very high and for the first time for years went truly innovative... I cannot but applaud to this "rejuvenation" in corporate spirit.

 

I'm not Mr. Kaufman and I hope for them they have properly made their homework, both on the technical side and in studying the potential market... But the amount of investment is surely high and denies the argument so often read here Leica is unable to finance an important R&D program. Time will tell if the choice to invest in such a new concept will be more profitable in the end than concentrating on the development of a truly professional M-mount small format FF rangefinder with all modern bells and whistles and a total reliability (for which- I think - there is a much larger customers' panel) for the price of the M8-2, all the weight of Leica past history and a lot of people already having compatible lenses as selling arguments.

 

I simply (in a more personal note) regret this option hadn't been retained...

 

FPW

I don't own a Leica, but always wanted to after using one. Anyway, I suspect that Leica will make a comeback into the professional market with their S2 and future R10. They are on a roll.

the new hyper-fast lenses will turn the RF aficionado and professional market upsidedown.