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The title may mislead some to think I wish to derive morbid pleasure from the lay-offs, but I don’t. My sympathy always goes to those who lose jobs themselves – I was laid off twice within a 12 month period and I know how hard it is. I am also a photographer, so I am generally unhappy about the trend in the industry.

But first, I also have some other things to focus on.

Is GoPro a blue chip or even a good bubble indicator? 

Once upon a time, the tech bubble more or less meant a bunch of internet companies, or software companies and the associated PC industry etc. Gone are those days. Having lost a sense of focus or purpose, companies all the way from Google or Apple and everyone in between want to make everything from cars to dildos (maybe not, and this would be particularly ill advised as there are some really well established “players” in this line of work), in an apparent attempt to make sure their software, OS and apps etc. get on everything, from your mop to your refrigerator.

And, so GoPro would easily belong. Plus, when did they go IPO (which surprised me, as that is not the exit strategy I would have picked and it appears this is now telling), they were celebrated as some sort of a tech wiz, which Mashable (link below) also pointed out today.

Thus, you could claim that their descent is a good indicator. I am however going to try to present a counter argument as well.

Why is GoPro falling?

Last year, for Memorial Holiday, I rented out the GoPro. I had become fascinated with the pending arrival of the Hero 4, and I always wondered if there is a clear way for someone very used to classic SLRs/DSLRs to do something with the camera. A coworker of mine owned a GoPro 2, and I tried playing with it to not much avail. Still, I wanted to try the thing anyway. In the three days, it became hard enough to figure out how to turn the damn thing on – this with my brother, an uber-geek compared to me also chiming in. Eventually, the camera stayed in its bag and was returned almost as-is to BorrowLenses. So, lets take a look.

1. User Base: I think the GoPro was and is certainly well marketed to sports and adventure folks. Plus, there are some very creative ways in which they are used around nature. Yet, look at me. I have been shooting for nigh on 22+ years and I just missed the cut for being called a “Millenial”. I am an engineer, I am quite comfortable with cameras and this thing should have been dead easy to figure out. So, problem 1: usability, customer training, marketing and on and on she goes.
2. Diversification: Related to 1, I think a widened customer base was not considered and that would explain the drop in interest. Is there a way this can be used for street photography besides nature? Or, could you do technical engineering/science work with it?
3. Product Release Strategy: When Hero 4 came out, the timing did not appear suspicious. In hindsight however, that should have been released by Dec. 2014 at the latest and then efforts should have been made to release Hero 5 by the holiday season in 2015. Even the magazine site that broke the rumors about the delay in launch made it clear that this was going to be bad news. And, the thing is STILL not released!! Hello?
4. Accessories: Then, relating back to 1 and 2 one more time, because I think this is the order in which the seriousness of the issues goes down, the camera does not have any cousins, or accessories/attachments or anything that can bring in some floating cash. I mean there are all these tiny trinkets they supply, but those things are usually just “bundled” into one price. This I believe is a major weakness for the organization.
5. One Trick Pony: This doesn’t go back to accessories or inspiring other uses for the GoPro, but this goes back to the organization’s ability to actually release OTHER products. This is clearly why I was shocked when they went IPO with what I thought was a sports/bike enthusiasts toy. The crazy rise in the stock price didn’t make sense either. And I still honestly believe, they should have sold themselves to a larger organization. Of course, remember Flip? The acquisition could have made things worse too, but, this doesn’t seem a great strategy either – a much delayed, haphazard release schedule for a product with a very narrow market.
6. Content issues:  One of the things I had looked into was to access some of the user generated GoPro content (like I use Pexels in my work for example). For one, the sources appear few and far apart and simply quite expensive. This might be another reason why GoPro is seeing lackluster growth. I believe, if they made it easier for people to find content, publish content and be able to use it (this would take training, but can and should be done), then there would be an avenue for them to grow the user base.
7. Organizational Leadership: I got to see the founder on Stephen Colbert’s new show (can’t remember the name, don’t care, especially since Colbert himself has sunk to 3 by trying to accommodate political guests whom his viewers do not prefer at all), and I got the sense of a very friendly guy who probably likes to do Yoga and eat Tofu, which most of us in the valley do. The thing is, harsh as my statement might seem, I didn’t envision a leader able to see a multi-billion dollar company through sustained growth. I don’t know if there is a different term besides the Halo Effect, but founders don’t make great leaders always. This one seems like an issue where a strong leader with vision and strategy for business success, and not just a good surf ride or two has been missing for a while.

Also, I am finding it hard to understand why the company had to grow more than 50% to about 1,500 employees. For one camera, even 750 seems like a lot! So, clearly, there are some                  issues at hand that need careful examination. I am also not buying the content of this tweet below:



JUST IN: GoPro CEO says decision to cut 7% of its workforce was a “difficult and deeply emotional decision”, but “a necessary one”.

— CNBC Now (@CNBCnow) January 13, 2016

7. Awareness of Industry Issues: Related to all this, is the general state of the camera industry itself. Big brothers Canon and Nikon are themselves finding it harder and harder to make sales          and have to fend off competition not only from smartphones with heavily megapixelated lenses and their own huge after-market accessories business, but also from camera equipped drones          and all other new threats. The less said of the Radioshacks of the industry such as Sony, Ricoh and Olympus (though they have a good medical arm despite questionable activities that                landed them in hot soup), the better.

So, if you look at all of the above reasons, it makes you wonder if GoPro’s problems really reflect the tech bubble, or just lackluster strategy and poor management. I am going with the latter. For more proof, I am going to detail some of the camera industry’s own problems, which are not very different from what GoPro is facing but not really addressing.

The Camera Industry

I am not exactly what is called a “gear head”, but I am also a bit primitive in that I hold camera equipment in very high regard. But, most people don’t care so much and this was further egged on my smartphones, which made it easy for people to carry one less thing and get a lot more functionality out of the phones. This started the descent for the camera industry in general, and they still appear to randomly wander around without a strategy. This extends to all camera related companies. Remember Kodak? Also SanDisk is about to be swallowed…

1. Smartphones: I have already said enough, but this is factor number 1, and the phones are going to go nowhere, so this is the main existential threat to the camera industry. For anyone who used to shell out a few hundred dollars or more to get a point and shoot, that cost is now easily eliminated, and most will never look back again. Now, the camera manufacturers are slowly trying to integrate the phones with cameras through apps and such, and that is good, but it only makes things worse for them in the long run.
2. “Pound of flesh” features: If you remember your Shakespeare,  you can relate to this. In a response to competition and in an effort to try and recuperate losses, many camera companies came up with really stupid ideas. They’d add WiFi to a 5MP camera and want $1,000 for it. Maybe (and probably) Leica can pull that off, but the rest of you aren’t Leica. So no matter how exciting Popular Photography writers would like to make it sound, a $50 smartphone, in 2016, probably has WiFi and a 5+MP camera. So, to repeat, that is just stupid. And if you looked closely, you have no idea how many of them are engaged in this nonsense.
3. Cannibals don’t like mirrors: I am speaking of mirrorless cameras of course. Now, the idea of expanding to a new type of product, reducing the noise from a falling mirror and the size of the camera all sound good, but when you see an ad that says “Look world famous photographer X uses our mirrorless camera”, what do you think the customer is going to do with your next desperate advertisement asking them to buy the new, new DSLR? Plus, the mirrorless bodies in most cases don’t take DSLR lenses. So, this is a one-way street, and most people won’t make a roundabout effort to come back up. ILC cameras just confuse me, so I am not going to go there.
4. Dead Pixels: When I finally made the shift from majority film to majority digital, I expected to be upgrading every 2 years or so, imagining a world in which camera companies took Moore’s law by the horns and gave us larger and larger pixel chips. Except, both Canon and Nikon still offer circa 20MP chips, and so, I still shoot with my Canon T2i. Please don’t faint. Maybe, I should have said that earlier. And it is a distant dream of mine to shell out the 7K or so it will take to buy the Canon D, but I am not too thrilled about having to use the tripod just to photograph a docile slot. So somewhere down the line, the pixel wars just ended and today’s cameras are almost  just as bad as cameras from 6+ years ago. This is truly sad. Yes, Sony has a 36MP sensor, but given that companies now historic instability, I am not going to make the switch. You get the point – a lot of room for improvement, a lot of room for strategy and it was all just chucked, by EVERYONE!
5. Death by Lens Purchase: You can’t blame the smartphones for everything. Camera companies have embarked on a slow path to suicide. In a world of smartphones, GoPros, their knock-offs, mirrorless cameras, ILCs, drones carrying cameras and what not, they decided to screw the ones buying DSLRs. They first moved image stabilization from the camera to the lens pretending that was the “best thing to do”. Well, why didn’t they do that from the start then? The real reason is, if you buy the new cameras, you have to buy the new lenses. Plus, my friends and I went through a nasty experience. Through firmware updates and such, Canon made sure that slightly older Sigma lenses simply did not work with newer Canons! Can you believe that? How is being disloyal to your customer going to help you?

In any case, these are at least the major camera industry problems as I see them. Nikon is suffering. Samsung is rumored to shut down its camera division (which as of my last look-see, Samsung vehemently denied), and now we have GoPro. And besides a few innovation spurts, like the recently announced 120MP 35mm chip by Canon, not much is happening to stem this blood bath.

Conclusions

I guess in a round about way, I am saying this. this particular post is just about the camera/photography industry and GoPro. I believe it is possible for GoPro’s problems to indirectly reflect a down trend in the tech industry, but I doubt it. Yes, at least 105 jobs will be lost, people will have to find other jobs, relocate, etc, but I think, as stated earlier, those are not direct metrics or effects.

It would appear that every problem GoPro has currently, as is also the case with the problems of the camera/photography industry can be solved, needless to say, without layoffs. Whether there is leadership present to solve this or not, is a different story that only time will unravel.In the case of GoPro, as many people already surmise, they could become an acquisition target, which even now, will provide the pony with a stable and the shareholders with some returns..

Here’s when GoPro could become an acquisition target https://t.co/46zpnwMuVy pic.twitter.com/ks9K5ZL3Gu

— MarketWatch (@MarketWatch) January 15, 2016

References:

1. A Mashable Write Up on GoPro: http://mashable.com/2016/01/13/gopro-layoffs/#4e0oFpsObkqU 
2. Images courtesy of: https://www.pexels.com/

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