Framingham, MAâ€" Shipments of digital cameras in the U.S. increased 17 percent in the second quarter of 2006, with growth attributed to gift giving for graduating students and Father's Day, according to a new report by IDC.

The study, “U.S. Digital Camera Market Share Review,� notes that approximately 6.3 million units were shipped in the quarter. And, among the camera makers, Canon Inc. is said to retain its No. 1 ranking in market share.

In essence, despite the seasonal spike in sales, the report points to maturation in the digital still camera market, with growth flat in Japan and “slowing in the United States as the excitement over cameras wanes and more consumers buy mobile phones with built-in picture-taking capabilities.�

IDC projects that U.S. shipments are expected to grow only 8 to 10 percent this year, compared to the 21 percent increase in 2005 and 60 percent improvement in 2003.

In regard to the market leaders, the Framingham, Massachusetts-based research firm reports that Canon--which recently posted a 33 percent increase in operating profit year over year with robust digital camera sales--remains the segment leader for the second consecutive quarter, with 22 percent. Sony Corp. follows with a 16 percent share; and Eastman Kodak, who dropped from first to third place last quarter, retains that position with 15 percent.

IDC analyst Christopher Chute noted that Kodak’s market share slump comes from a planned reduction in sales of low-end cameras, typically costing less than $100, where they hoped to earn profits from follow-up sales of printer paper and supplies. The company, he said, will focus on pricier, more profitable models.

“They have pulled back from the proliferation strategy where they seed the market with cameras and look for profits on the back end,� Chute said. “They have to start looking for profits on the front end.�


August 2006