Did Canon Just Acknowledge That Sony’s Aggressive Pricing Is Eating Into Its Profits?

Did Canon Just Acknowledge That Sony’s Aggressive Pricing Is Eating Into Its Profits?

Canon has just announced its financial results for the third quarter of 2019, and in line with recent performance, the news is not good. For the first time, the report seems to acknowledge that aggressive pricing by its competitors is having an impact.

Canon continues to cite a global economic slowdown, partly as a result of the ongoing friction trade between the U.S. and China, with Europe and China being worst affected. The report states that as a result, “net sales declined 6.2% to 869.5 billion yen, operating profit dropped 43.7% to 38.4 billion yen, and net income fell 42.7% to 26.5 billion yen.”

Notably, and perhaps for the first time, there is a hint that Sony’s aggressive pricing and release cycle might be having an impact. The report mentions “price competition surrounding higher-end full-frame models” as being one of the major factors in falling sales. It explains that the “energy that each manufacturer is putting into this segment” has intensified, and it’s always interesting to try and read the hidden meanings buried in these reports.

Sony certainly positioned itself very aggressively when it released the a7 III last year, with many customers realizing that the a7 line had matured to a point that it was genuinely a viable alternative to their pro and prosumer DSLRs. With adapters ready to help Canon users make the transition, the relatively low price made it an attractive option.

On top of this, Sony has adopted a system of incremental updates across its top-end cameras, offering new models that offer relatively minor upgrades, as seen in the Sony a7R IV. This has had a knock-on effect of pushing down the price of preceding models, such as the a7R III, which is currently available for less than $2,500. Given that this went to market in October 2017 at $3,198 and arguably still offers more than Canon’s EOS R, it’s understandable why Canon might be now feeling the squeeze.

While pro cameras are taking a hit, the report does note that consumer cameras are performing well and that total camera sales for 2019 are still in line with projections.

What are your thoughts? Will we continue to see Canon fighting at the top end of the market? Leave a comment below.

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34 Comments

Last term Sony published they are dropping by 22% their quantities sold (mainly mirrorless and compacts) .. Canon only less than 8% in the same time (DSLR, mirrorless and compacts).. No figures comparable with Canon about Margin and Sales published by sony (why Sony is showing quantities without videos and incomes only included videos ? something to hide ?)

End of 2018 Sony was number 3 in this market very far behind Canon N°1 .. and they are dropping 3 times their quantities sold between July and September => it can be worse in the next 3 months. Again Canon should increase their market shares in quantities in 2019 like 2018 .. and Nikon and Sony going more down.

The street price of the EOS R is now under $1800. Yes, this hurts Canon, but Sony too. There's all out price war in the the FF space, and the EOS RP is now under $1000. I think Panasonic will be the odd man out.

Rod Kestel's picture

Dunno about camera sales, but that model needs serious help. I'd suggest urgent burger and beer therapy.

No I waited specifically for canon to release their mirrorless - they instead released a camera that would not meet my needs serving clients in today’s world. I need a company that hears me not some Hollywood studio (that’s using arri anyways) or some sports agency that may employ 100 eager togs that sign away their rights. I need a combo video and stills I need high mega pixel I don’t need a company that wants to strong arm it’s clientele nor wants to bring relevant updates in a timely manner.

Rayann Elzein's picture

Well then the 1DX Mark III is your dream camera ;)

Mike Stern's picture

1DX won’t cut it

Rayann Elzein's picture

Care to elaborate?

Spy Black's picture

I think the OP was waiting for a mirrorless from Canon he thought would've been up to what he expected from Canon, but was not. A DSLR won't cut it when you want a mirrorless, whether it's up to speed or not.

Rayann Elzein's picture

I just don't understand why anyone would get upset if a DSLR and not a mirrorless is announced. What can't the 1DX III do that a mirrorless equivalent would solve?

Spy Black's picture

I can't answer for the OP.

Dude your recommending a camera that isn’t even out today not to mention last year or the year before JFC!

I shoot Sony but to me it looks like Canon are waking up and will fight to keep there place as number one. Recent firmware updates indicate they are changing there strategy, so does the eos6m2. Maybe late but it is good they are starting to fight for there customers.

I don't think it's the pricing. I shoot Canon, and let's face it, Canon hasn't even come close to keeping pace with Nikon and Sony. I can't imagine how in a free-market society that's not going to negatively impact their profits.

Rayann Elzein's picture

How do you know? Have you shot Nikon and Sony? Aren't you able to do everything you want/need to do with your Canon? I do shoot Canon, and I just don't care what Sony and Nikon do. I just have a Sony 7S to shoot night time videos, but otherwise it's a pretty terrible stills camera that's light years behind a 5D Mark III that came out around the same time if I'm not mistaken.

Koketso Resane's picture

Well put. I have a vanilla A7. I use it almost exclusively for portraits because I love the RAW files it puts out, and even then - I have come to accept that the Auto White Balance is garbage. For everything else though - I reach for one of my Canons, all day every day.

The III and IV gen Sony a7 series are well ahead of the 5DIII and 5DIV, and of course Canon's first gen R series bodies. The a9 is even strong competition for the 1DX II. Sony is continuing to build an excellent system. You really can't base it on how their first gen a7 series performs/handles.
The only thing that I wish the a7III had that it doesn't is 10bit internal or raw output for video. The 5DIII has this via a hack, but it's not enough to make up for all that the a7III can do (and the simple workflow/management of "good enough" 8 bit files).

Rayann Elzein's picture

Again, nothing is just "good enough" as far as I am concerned with Canon. I can take any photo I want, at any time, without feeling handicapped by the system. Why would I need to go look elsewhere and take a huge financial hit with the need to change all my lenses?

Fair question. I love my Canon interface but the IQ of even my 5DS can't compare at high ISOs to the D850. (The sensor of the 90D seems to be a new generation which, when translated to full frame, could be what brings Canon back to par, and for that I am very hopeful.) And although I may never switch to mirrorless, it's frustrating to see only Canon still be below 40 MP and only Canon lack IBIS in its mirrorless offerings.

Don't get me wrong -- I so want Canon to rebound. I love its interface and its ergonomic consistency and even its 1DX3 will *still* use the same battery I've been using for 10 years in four bodies. That kind of stuff is beyond wonderful and frankly I'm amazed that Nikon and Sony haven't emulated these attributes. And of course, yes there really is that incredible Canon color. But I feel like the unfavored stepchild when I'm looking at my 12,800 ISO shots next to my Nikon and Sony colleagues.

Spy Black's picture

"And of course, yes there really is that incredible Canon color."

I work in studios full of Canons, where we shoot hudreds of images per day. That "incredible Canon color" may work well for portraits and such, and anyone who isn't proficient in color work, but if you need to perform precision color reproduction, that "incredible Canon color" is an absolute nightmare.

Kevin Harding's picture

"that "incredible Canon color" is an absolute nightmare".

Really ? As this is a topic of constant debate can you elucidate ? I've never got the argument. They are just colours that if you shoot in RAW can be manipulated to whatever is desired assuming you have have the knowledge and the right tools. There isn't even colour parity across the full range of cameras/lenses !

Spy Black's picture

Dude, I've been dealing with this shit for years. If you need to perform precision color correction, literally ANYTHING but Canon will do. Try shooting artwork, prints, anything made out of wood, etc. and match the product color and luminosity values. Calibrate it if you want with x-rite, Capture One, whatever. Go ahead, use your RAWs. LOL!

Daris Fox's picture

You've obviously done no research on this. Why? Canon has repeatedly warned of decreasing camera sales since 2 years ago, anyone watching the financial reports and reading their future projections could see that. However, so was *every* other camera and sensor manufacturer. F-stoppers have even posted some of those articles, so why the sloppy article?

Don't turn this into a narrative about Sony vs Canon, all manufacturing suffering some more than others. Anything else you're creating a fanboy article and clickbait. Consumer market is scorched earth, pro-sumer isn't too far behind because of developments in other sectors such as AI 'photography' enhancements for Apple and Android devices. That leaves the professional market as the only real money generator and even then the profits will be relatively slim. Those reliant on Sony are screwed, it's really that simple as it gives Sony the ability to control their competition.That leaves Canon as the last real independent manufacture hence all the articles attacking Canon's sensor tech ignoring it's stronger features (such as DPAF).

Rayann Elzein's picture

"Don't turn this into a narrative about Sony vs Canon" Well this seems to be the editorial line of this website ;)

Harley Moon's picture

I'd be spending money on a load of that expensive EF glass if they'd just release the damn pro mirrorless body!!.. but still, we wait!

Mike Stern's picture

Sony’s aggressive pricing??? Sony was always more affordable than canon cameras. Still are. That’s not the news. Canon’s failure only comes from not producing innovative products, deliberately staying behind the competition, when they are able still choosing to crippling down their models, being late to adapt the newer platforms.
Sony was earlier, more diligent And generous in all these areas. And still maintained keeping their prices at more affordable levels.
A7III not only cheaper but overall significantly better camera than the counterparts.

Why having difficulty giving compliments to those who earns it?

Jan Kruize's picture

More choice? They don’t have dslr’s. still a very big market.

They are not interested in the DSLR market so why spend the time and money there? Olympus, Panasonic, and Fuji do not have DSLRs either. So what?

This is not a DSLR vs. Mirrorless garbage rehash. Sony has just pushed the rate of model overhaul up to 11 whereas everyone else is stuck at 5. Sony offers more choice and variety at all different levels of price points. That is Canon and Nikons problem. I am, by the way, an SLR/ DSLR user.

"Did Canon Just Acknowledge That Sony’s Aggressive Pricing Is Eating Into Its Profits?"
They, all of them, soon will made equipment only for professional people. The smartphones will be more and more popular. And the prices are growing...

Kirk Darling's picture

That's not a lot different from most of the 20th century, from the time Kodak invented the box Brownie in the late 1800s to Canon's AE-1 in the mid 70s. Up until the AE-1, people who were interested in photography only to document their other activities (not photography for the sake of photography) stuck with snapshooting equipment, from box Brownies to Instamatics to Polaroid cameras.

It was really the Canon AE-1 that enticed casual snapshooters to buy SLRs. That created a market bubble that has now been punctured by cell phone cameras.

So the higher-end market is really just collapsing to what it was prior to the 70s.

Cellphones could also have much to do with camera sales as a whole. Of course sony has taken a bite out of canon and nikon. Sony does have a nice camera and i do shoot with a canon. When the time comes to upgrade my 3 yearold 5dm4 i will shop around, even though i love how my canon operates. Competition is usually good for the consumer.

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