10 reasons Ricoh will survive the purge

For years, there’s been a notion that too many companies are operating in the consumer camera market, particularly Japanese companies – Canon, Sony, Nikon, Panasonic, Ricoh, Olympus, Fujifilm and Sigma, to name the current major players. And various bets have been placed on who would be first to go, which I’ve reported on before. Now that there have been lay-offs at Nikon and Canon and the imminent sale of Olympus’ consumer camera business to Japan Industrial Partners, the company that also took over Sony’s “VAIO” laptop division when Sony decided that division wasn’t performing sufficiently, speculation fever is upon us again as to who would depart next. In an article that received widespread attention, Nikkei Asian Review points the finger at activist investors eyeing up Ricoh.

thetasccolours — The Ricoh Theta SC, a very affordable 360 degree “spherical panoramic” camera with a resolution of 14 megapixels, at around 200 Eurodollars

However, Ricoh’s camera division is profitable, but beyond that, here are some reasons why I believe the business to be in sound shape, and easily on a solid foundation for surviving the “purge”, if it were to come:

Pentax has worked under doom predictions for over a decade, and is still here. Its employees won’t spend their time on job search sites when the rumours go around again. While other companies may start panicking, Ricoh Imaging will be right in its usual element.
The Nikkei Asian Review said that aggressive competition was a contributing factor to the decline of the camera industry, and that failure to save for bad times was a risk. I don’t know how Ricoh’s bank accounts look, but they do not seem to be competing aggressively. In fact,
Pentax is now in a segment where competition is in decline – Nikon and Canon have both made pledges to aggressively enter the full frame mirrorless market, where Sony is currently holding dominant marketshare. So in the DSLR segment, Pentax is now the major remaining player. Nikon and Canon may further attempt to release occasional new DSLR models, but there is a distinct “maintenance” feel to their attitude towards their DSLR customers, and there would justifiably be questions over whether they can hold both forts at the same time. Some customers are already considering switching to Pentax.
Ricoh Imaging also has another leg in a low-competition market, which is compact 360 degree cameras (the Theta line).
The waterproof WG-6, in which Ricoh unified its own G line with Pentax’ WG, using Ricoh branding as it does for all compact cameras.
Other than that, its camera portfolio is slim, with only the Ricoh GR series and various waterproof compact cameras (the WG and G series, which are being merged into a single model line). Ricoh acted early to cull excess compact cameras from its line-up, focusing on the segments least at risk from competition with smartphones, namely waterproof cameras. In that segment, its main competitor is Olympus. Right now, Olympus’ consumer imaging unit is not doing so well and currently taking a sharp look at which assets to keep investing into as part of a sell-off to Japan Industrial Partners.
In that same vein, an action camera originally launched as part of the WG waterproof series, and still listed on parts of Ricoh’s website, seems for all intents and purposes to have been silently discontinued – another smart move given the sudden burst of competition and subsequent rapid decline of that market.
Ricoh GR III Street Edition, with interchangeable colour accent.
While the Ricoh GR series may seem to be the model most at risk from competition with smartphones, it is profitable. In its segment, it competes mainly against the Fujifilm X100 series, but the Ricoh GR series has a unique feature in that only the GR fits into a trouser or shirt pocket. It is also by some considered the least obtrusive camera for high quality street photography.
The final arrow to Ricoh Imaging’s quiver is a small range of binoculars, scopes and telescope accessories. As a mature technology and very established and therefore slow market, the binoculars and scopes are a low risk element to the business. Having said that, binoculars are one area where Ricoh has applied its own and Pentax’ strengths quite rigorously – nearly all of Ricoh’s Pentax binoculars are waterproof (JIS Grade 6 and up to 1 meter in depth). They are also least at risk from competition with smartphones.
The “Marine”, a set of binoculars specifically developed for naval use.
Another aspect is that Ricoh has very successfully rebranded all Pentax assets except DSLRs and binoculars, merging the WG line with its own G line under the Ricoh brand. Ricoh dipped its toes into the water of whether its name would be welcome on Pentax products, noted the resistance to this and responded accordingly, reserving the Pentax name for the DSLR segment in a sort of blood oath (neither can live while the other dies). And while the fact that the community named the K-1 before its name was officially announced may have been coincidental due to the obviousness of the choice, it may well be that the “K-new” moniker for the upcoming APS-C K-mount DSLR will also be accepted by Ricoh management. In terms of community relations, except for being a little slow to develop this product or that technology, Ricoh have done very well so far since their takeover of Hoya’s Pentax camera division.
Ricoh is developing technologies that others will need. Its recently presented minimal-distortion optical viewfinder is of relevance to augmented reality applications, in cameras or other devices, and hybrid optical-electronic viewfinders. The latter is a technology that Nikon holds a basic patent for, but Ricoh’s new viewfinder may be a missing piece on the path to developing a comfortable viewing experience.

In conclusion, Ricoh’s strategy seems to have been a combination of seeking out unique markets (with the Theta), but withdrawing quickly if competition proves too fierce (with the action camera), and otherwise staying, developing and expanding in those markets where competition seems tolerable or declining (Pentax’ DSLRs and the rebranded WG series), or where they have a sufficiently dominant position (Ricoh GR).