By Louis Bedigian
The company that popularized the art of shooting with a DSLR is about to release the next evolution in digital cinematography.
Last week, Canon (NYSE:CAJ) unveiled the C300, a new camera designed specifically for high-end filmmakers. Due for release in January at a price of $20K, the C300 comes with a “super 35MM-equivalent 16:9 large CMOS sensor” that shoots 4K images (or not, depending on who you talk to). Thus far, the initial test videos have been very impressive.
This announcement came just as RED announced the final plans and pricing for its long-awaited Scarlet camera, a smaller, less expensive alternative to its previous offerings. Scarlet will retail for just under $10,000 (camera body only), but you can get a ready-to-shoot model for roughly $15,000.
At first glance, Scarlet might sound like the better deal. But RED cameras typically require a bunch of expensive extras. That's part of the company's stragety: lure filmmakers with a low base price and hit their pockets later with a plethora of expensive add-ons. While Canon could be planning a similar strategy (ex: you'll still have to buy the lenses and other equipment separately, but that's true of most film cameras), the company has one significant advantage over its competitors: filmmakers are already fans of the format.
Over the past couple of years, indie filmmakers and commercial producers alike have been investing heavily in Canon's top-tier line of DSLRs. Cameras like the 5D Mark II, 7D, 60D and even lower-end models like the Rebel T2i were all built for shooting stills. But with the ability to shoot gorgeous 1080 video, these cameras have become the new favorite among filmmakers on a budget. Not only are they cheaper than traditional HD cameras, but they accept a plethora of Canon lenses without the need for a special adaptor. The same cannot be said for the average video-specific camera.
When these filmmakers grow beyond their indie status, where are they most likely to turn? In the past, they'd go to RED, Sony (NYSE:SNE), or some other manufacturer. Not anymore. Now they have a high-end option that's compact, fairly lightweight, and is very similar to the DSLRs they have already been using.
While the world of digital cinema is still evolving, Sony (SNE) is arguably the most influential company in this field. For the final Star Wars prequel, George Lucas reportedly paid Sony $1 million each for a series of custom-made HD cameras. If true, this would explain why Episode III's images – shot entirely in high-definition – are indistinguishable from the previous Star Wars prequels, which were shot partially on film. In fact, Episode III is the only movie I have ever seen whose picture quality is on par with traditional film.
Theoretically, other Hollywood filmmakers should have been eager to order their own custom cameras from Sony. But they didn't. They looked for cheaper alternatives, hence the success of the RED One. Unfortunately for moviegoers, this means that digital-only movies tend to look much worse than those that were shot on film.
Sony had a stellar opportunity here to step in with a lower-cost model and take control of the market, but it completely missed the boat. The company has been taking losses in nearly every division. If RED holds onto its market position, and if Canon takes another chunk of the market, where will that leave Sony? Right now, the cheapest professional, high-def camera that Sony makes retails for nearly $17,000. Though its most expensive listed camera is $100K, Sony won't even provide a price for models that go higher, simply saying, “pricing available upon request.”
With little to no competition in the DSLR market, and very little competition outside of RED, Canon is in a very good position right now.
Traders – before diving into the action items, let's go over the key points of Canon's newest camera:
- In addition to beating the RED One at its own game, the C300 undercuts the release of Scarlet, RED's long-awaited low-cost alternative (at twice the price, mind you).
- More importantly, the C300 gives tomorrow's filmmakers a superior upgrade option when they move beyond their low-cost indie roots.
- The transition from the 5D Mark II to C300 should be fairly seamless.
- The compact size makes it insanely versatile.
- Unless Scarlet proves to be a vastly superior camera, the C300 is likely to take over this area of the market.
- Expect smaller and cost-cutting studios to be the earliest adopters of the C300. Look for a few heavy hitters in Hollywood to experiment with the format.
- This could easily become a prominent player in commercial development (an area where Canon's existing cameras already excel).
- The C300 could become a leader in television production as well.
That said, there are a couple of other things to remember:
- To be clear, this is not the end of film.
- This isn't the end for RED either.
- It is, however, the beginning of a new era of filmmaking that will pave the way for additional cameras from Canon, which will push the boundaries even further.
If you believe in the future of Canon's new cinematography offering, then consider these trades:
- If Canon wins by selling smaller, lighter and lower-cost cameras, so will Hollywood. From big studios like Disney (NYSE:DIS) and Lions Gate (LGF) to Paramount (NYSE:VIA) and the Comcast-owned (NASDAQ:CMCSA) Universal Pictures, studios can always benefit from lower costs.
- Fox, the News Corp.-owned (NASDAQ:NWSA) TV network, is already a fan of Canon's DSLR format, shooting an entire episode of House with the 5D Mark II. Expect at least one new Fox pilot to use the C300 in the 2012 or 2013 season.
Are DSLRs just a fad? Will the larger, more traditional cameras continue to reign supreme? If you have concerns about the C300, consider these alternatives:
- If bigger, bulkier and more expensive cameras are what filmmakers want, Sony can provide them.
- Panasonic (PC) might pose a greater threat, particularly if 3D filmmaking continues to grow. Panasonic has been experimenting with several smaller, cheaper, 3D-capable still and video cameras (on the pro and consumer level) that could stifle Canon's efforts.
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