Canon reports that digital SLR market may slow

The worldwide economic slowdown has begun to impact sales of digital single-lens reflex (SLR) cameras, but overall Canon's digital camera sales are still strong ahead of the year-end holiday shopping season.

However, consumer reviews indicate that the outlook for 2009 sales though has become increasingly difficult and the $40 billion digital camera market may actually shrink next year in unit terms.

Global digital camera sales and demand grew almost 25 percent to 130.7 million units in 2007. This is according to data from research firm IDC. Canon and its top rivals, such as Nikon and Sony Corp, continue to forecasting decent sales growth this year.

That being said, Canon last month reduced its 2008 compact digital camera sales forecast by 6 percent to over 23 million units. Even with this reduction, that would still indicate a year-on-year jump of 10 percent. Canon also stood by its estimate for SLR sales to rise almost 40 percent to 4.4 million units. So while growth may slow, many industries would love to have 40% growth!

Demand for DSLR cameras has continued to grow strongly over the past several years, and it has been spurred by a drop in camera prices. This has expanded the customer base beyond advanced and professional amateurs.

This growth has lead to big profits for Nikon and Canon, both of which dominate the high-margin segment of the market.

Canon has said SLR demand was starting to show signs of "stagnation". However, that stagnation is not enough to for canon to review it business plan or knock its overall camera sales forecasts off track.

According to Canon’s internal market data, recent sales appear to have been fairly strong and no worse than they had thought. In fact, Canon saw their DSLR camera models and products gain some market share last week when compared to Nikon and Sony.