Did Instagram Kill The Camera?

It should be to no surprise to anybody that the digital camera killed the film camera. However, something else is in play today that’s causing a whole ‘nother industry to die once more. Are smartphones, and by extension, apps like Instagram killing the digital camera? As more and more people buy smartphones (and in turn, upgrade to the latest ones), the need for a digital camera becomes obsolete. However, one can argue that apps like Instagram have sped this process up. I’m speaking off of experience but one of the things with cameras was being able to print out pictures and share them with family and friends when they came over. Or being able to hand them out. But now, we just put them on the internet for everybody to see and access at nearly anytime from anywhere.

First, here’s some projections that shows the how diversified the camera system market will become. The “Stand-Alone Camera” category is set to shrink.

Camera System Market

 

 

 

 

 

 

 

 

 

 

 

The Chart

We know the camera is dying. But is Instagram (and by extension, Facebook/Twitter/etc) killing it? Let’s go to the charts. The company with the largest market share in digital cameras is Canon Inc. So I’m going to use that as a proxy for all camera-makers, since there is no camera-maker ETF.

$CAJ – Canon Inc. Weekly Chart

As you see, the Canon chart topped around the time Instagram was released. Now, Instagram didn’t really pick up steam until mid-2011, so $CAJ pretty much languished in the meantime.  However, what seemed to be the nail in the coffin was the Android release and the subsequent Facebook acquisition of Instagram. At the time of the Instagram acquisition, Facebook was being laughed at for paying $1 Billion dollars! I thought it was a little pricey but I that it was the right move. It’s kind of what’s keeping Facebook in the game right now. It was a genius acquisition, and I’m not the only one to think that. While 1 billion sounds like a lot, measured against Facebook’s current market cap, it’s less than 1%. Canon is down 32% since the acquisition was announced. It recently came within 2 pennies from hitting a 4.5 year low.

Now, I’m sure there’s more to Canon’s decline than just Instagram’s ascension. But it’s sure hard to ignore the impact Instagram (and smartphones) has had on the camera market. Especially since the Instagram filters have made everybody a professional photographer.

Canon Weekly Chart

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tags: $CAJ $FB $SNE $EK $PC

 

 

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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