Where Did We Come From?
The seeds for digital mirrorless' rise and eventual dominance were first planted by the point-and-shoot cameras from the film era. Many like to point to range-finder cameras, such as the Leica, but the real genesis occurred when manufacturers started to strip out every non-vital camera part they possible could and ruthlessly simplify what was left. The end result were drugstore and big-box-store cameras that came preloaded with film and wrapped for single use. Buy the camera, take your pictures, drop the camera off to develop the film, pay for the prints. Rinse and repeat.
You can still buy those cameras today at places such as your local Walmart, made by companies such as Fuji. And as you can see you can buy them for less than $10, not including processing.
Where We Are Now?
That's significantly inexpensive, especially when you consider that the least expensive digital camera is a good order of magnitude more expensive. And yet, in spite of its low cost, Fuji makes a profit on each camera sold. Not much, mind you, but the fact they make a profit at all is amazing, and comes from stripping the camera down to its bare essentials;
- a light-tight simplifed box to hold the film
- the film
- a simple mechanism to wind the film and set the shutter
- a simplified single element fixed-focus lens to focus the image on the film
- a mechanical shutter release to take the photo
- a framing aid
The Digital Difference
Modern digital point-and-shoots are very similar in formulation.
- a light-tight box to hold the sensor
- the sensor
- a simple fixed-focus lens to focus the image on the sensor
- a switch to trip the shutter release and take the photo
- a framing aid
And then there's the price to buy one. You're going to spend around $100 if you want a contemporary digital point-and-shoot (not a discontinued sale item) that isn't an "utter disappointment". You can go well under $100, but you truly get what you pay for. And that's fine by the manufacturers, since the lions share of the market belongs to such point-and-shoots. Margins aren't so great, but like film cameras they make it up in volume.
The price for classic digital point-and-shoot cameras ranges from $100 to $500 (we'll deliberately ignore the outliers from Fuji (X100) and Leica (X-1), and similarly specified cameras). As you move up in price you find extra features such as zooms, autofocus, image-stabilization, large (up to 3") LCD screen on the back with possible live view, and swing-out LCDs. The framing aid is still optical (although it begins to behave like a rangefinder viewfinder).
If you want to see what the sensor sees then you spend enough money towards the $500 price point to purchase a camera with live view, so that you get to hold the camera out in front of your face and compose with the LCD screen on the back of the camera. Lots of "enthusiasts" turn their noses up at that method, but it seems to work just fine for untold millions of photographers around the world who are more interested in making a photograph than a statement.
But no matter what, there are no mirrors of pentamirror/prism optical viewfinders in this cameras. They're a thin box honed down in size, weight and complexity for taking pictures.
When you want a "real" DSLR then you start to spend around $600, usually for a body and inexpensive interchangeable kit lens. At that price Canon will happily sell you T3s and Nikon D3100s. Move up the price curve and you hit Canon's T3i, 60D, 7D, and then the 5DMk2 at $2,500. With Nikon it's D5100, D7000, and D700 again at $2,500. I stop at that point because those are the cameras that will probably disappear over the next five years, to be replaced by mirrorless interchangeable lens cameras.
Panasonic and Olympus showed what you could do by dropping the mirror box and replacing the pentamirror/pentaprism optical viewfinder with electronic viewfinders. The bodies shrank in size, but more importantly, the complex content shrinks dramatically along with the concomitant costs. Complex content is more than just the cost of raw materials and includes the labor necessary to assemble it into the overall camera and test it before it goes out the door.
Panasonic and Olympus showed even more savings when they shrank the distance between the lens mount flange and the sensor in µ4/3rd's bodies, starting with the GH1 and E-P1. Thinner bodies mean less material and lighter overall systems. Another savings occurred with the consequent shrinking of µ4/3rd's lenses. The overall system size and complexity shrank by at least 50% between regular and µ4/3rd's.
But Panasonic and Olympus kept the prices of the cameras up around the same price points as the entry and mid-level DSLRs they replaced. This allowed margins to increase, which is always a good thing. As Thom Hogan noted, the entry level µ4/3rds camera with kit lens is $599, the same price point as the Canon and Nikon entry level DSLRs. It's a price point the market is conditioned to (in spite of nasty grousing by certain forum denizens to the contrary). As long as the market is willing pay that price, then Panasonic and Olympus have no reason not to sell it for that price, giving them fatter profits at that price point. The only reason Canon and Nikon make more money on less markup/entry-evel DSLR is due to their market share and subsequent volume.
While Panasonic and Olympus pioneered mirrorless interchangeable lens cameras, it's been Sony that just recently blew everybody's doors off technically and showed where the future really lies. In case you didn't notice it, Sony has introduced three new cameras with 24MP APS-C sensors, with the most expensive, the SLT α77 DSLR, a mere $1,400 body only. By all accounts the Sony sensors are quite good, being one stop noisier than Sony's on 24MP 135mm sized sensor. For many folks, myself included, that's more than good enough.
But it's what Sony can do with that sensor technology that's most interesting. Assuming that Sony wants to continue making 24x36mm sized sensors, such a sensor, which is 1.5 times larger than the APS-C, would theoretically produce a 36MP monster of a sensor. Consider that the Pentax 645D, a medium format digital camera, has but a mere 40MP (across a much larger sensor). The hypethetical Sony sensor in an α850/900 replacement would be good enough for a lot of folks, especially if Sony could keep the cost down to around $3,000 like it has for its α900 body. The Pentax, by contrast, is a good $10,000 dollars.
Sony has dramatically raised the bar with regard to sensor resolution. It appears on first blush that its noise and ISO performance is more than adequate for a good 90% of the market. For that small market share that demands even more there are the extravagantly expensive tools to satisfy those needs. That's not the market segment Sony cares about, because that's not where the real money is.
Sony will push mirrorless, and they'll market it effectively, far more so than Nikon, and probably more than hide-bound Canon. Panasonic and Olympus have the ability to survive, if not florish in this new world order if they can effectively market what they have and deliver product when the say. Panasonic can't deliver, and Olympus (until very recently with their PenReady marketing push) can't effectively market. Both Panasonic and Olympus have spent the last two years creating an effective lens lineup for the µ4/3rds series, a lens lineup that Sony is having a hard time matching, and one that neither Canon nor Nikon have anything to match at all.
The key feature that made it so hard for Panasonic and Olympus to break in the regular DSLR market with regular 4/3rds, the extensive catalog of current and past Canon and Nikon lenses, is now an impediment to a new Canon or Nikon mirrorless system. The regular 4/3rds lens catalog wasn't that established or extensive, so it was relatively easy for the transition from regular 4/3rds to µ4/3rds. Sony actually did something very bright with its PDAF adapter for allowing its A-mount lenses to work on the NEX-series E-mount bodies. But at the end of the day customers don't want to use older, larger, heavier lenses on the new lighter bodies unless they already have them; they want to purchase new lighter lenses for the new lighter bodies. Panasonic and Olympus currently have the most extensive lens catalog for a mirrorless interchangeable lens camera system. That will, of course, change over time, especially with Sony.
Many of those big, complex DSLR cameras in the $500 to $2,500 price range are ripe for replacement with far simpler designs, with the same sized sensors, that do the same job or better taking photographs, with fatter margins for the camera manufacturers. And don't think that everybody isn't thinking this, and of ways to move their customer base towards the next big thing in digital photography; mirrorless.