When a company introduces a new product like OMDS’s new OM-5, it is always an interesting exercise to ponder their strategic intent. Some folks that I respect like Robin Wong, had a decidedly negative reaction to the OM-5. You may want to rewind this video and watch it from the start.
Suffice to say that I don’t agree at all with Robin’s product focused assessment of why the Olympus Imaging Division failed. Nor do I agree at all with his assessment of the OM-5.
As we all know, the Olympus Imaging Division ultimately was transferred to Japan Industrial Partners (JIP) and re-emerged as OM Digital Solutions (OMDS).
NOTE: Click on images to enlarge. Photographs have been added to serve as visual breaks.
I believe there were two fundamental reasons why the Olympus Imaging Division failed. The first is that they allowed their fixed costs to get out of control and woefully bloated. This made the prospects of profitability virtually impossible.
OMDS has been addressing this issue by taking tough, necessary actions such as reducing worldwide employment by 66% with the number of employees going from about 6,000 down to 2,000. Actions like this have dramatically reduced the company’s fixed costs, and lowered its breakeven point correspondingly. Both of these are key factors that contribute to profitability.
The second fundamental reason for failure was that the Olympus Imaging Division did not have a clear business strategy. It spread its resources too thin by trying to be too many things to too many people. It was taking a broad market strategic approach which was inappropriate for its size and capabilities. It relied on the size and weight advantages of M4/3 for far too long. It failed to identify appropriate niche markets and to differentiate itself in those niche markets with its products.
As detailed in an earlier article, the OM-1 sent a clear signal about the strategic intent of OMDS. In my view the new OM-5 is a continuation of this strategic intent. From my perspective the OM-5 makes perfect sense as it serves to reinforce the strategic position that OMDS is trying to establish in the market.
Strategy really comes down to making choices about how a business intends to move forward, and how it plans to successfully compete with its rivals. As a producer of M4/3 equipment OMDS is never going to successfully compete against full frame manufacturers by trying to go head-to-head on image quality.
Physics are physics. Larger sensors will deliver more dynamic range and colour depth when compared to smaller sensors like M4/3, and perform better in low light. Thinking that putting in a newer M4/3 sensor will magically allow the OM-5 to compete more effectively is misguided thinking.
Let’s look at what changes OMDS made with the OM-5 versus the E-M5 Mark III. What the company chose to do… and chose not to do… are very instructive when assessing strategic intent. Did it choose to make a substantial number of changes to the hardware or physical design of the OM-5? No… it maintained the same M4/3 sensor and the majority of the physical components and design from the E-M5 Mark III.
This tells us that OMDS is leaving the old paradigm of competition based on incremental hardware improvements behind. What changes did OMDS make with the OM-5? It added more computational photography technologies to the OM-5. Functionality like Live ND, Starry Sky and Handheld Hi Res were added. The strategic intent of this is crystal clear. OMDS will be competing based on the image making advantages of computational photography technologies.
Let’s consider the size, weight and image creating power that is resident in the OM-5 for the price that a photographer would pay to acquire all of that capability. In Canada the OM-5 lists for about $1,700. For that investment a photographer gets a small, lightweight camera and the computational photography technologies listed below. Plus, up to 7.5 stops of IBIS performance and industry-leading weather proofing.
- Pro Capture
- Live Composite
- Keystone Compensation
- In-camera Focus Stacking
- In-camera HDR
- Live ND
- Starry Sky
- Handheld Hi Res
What else can a photographer who wants the advantages of computational photography buy for up to $1,700 that delivers this much total computational photography capability in a dedicated interchangeable lens camera? You can answer that question for yourself after doing some research.
This brings us to the essence of a successful Focus Differentiation strategy. A company doesn’t have to create products that appeal to a wide array of buyers and capture large market share like Canon does to be successful.
What a focus differentiator needs to do is meet the needs of a select number of buyers better than any of its competition. It can be profitable and successful if it is the preferred brand of 1 out of 25 buyers, or even less. It doesn’t have to care about the rest of the market as long as it dominates its chosen niche market segment(s).
As photographers we all have our unique needs when it comes to our choice of camera gear. Every piece of equipment comes with advantages and challenges. The key is for each of us is to choose the gear that best meets our requirements with the least number of acceptable trade-offs.
Perhaps you’ve looked at the specifications of the OM-5 and you don’t like the fact that the camera does not have an upgraded sensor, or other hardware factors that you deem important. No problem. Buy something else. The OM-5 is not targeted to your needs.
If on the other hand the prospect of utilizing computational photography technologies is of primary importance to you, then you may find the OM-5 to be a perfect solution.
I shoot with a pair of E-M1X bodies and over 75% of the photography that I do utilizes the computational photography technologies in the E-M1X. These technologies are far more important to me than a new sensor or some enhanced video capabilities. I used to shoot with full frame cameras and my E-M1X can easily run circles around what was possible with full frame for the kind of photography that I do.
The comfort, handling and ergonomics of the E-M1X are critical factors for me as well. I’m often out with my camera for extended periods of time and having a really comfortable camera makes long, hard days out in the field, much more enjoyable and less physically demanding. So, all of this really comes down to the needs of a specific photographer.
To me, using a camera that basically offers me little more than being able to press the shutter release and get a typical image… regardless of its resolution, dynamic range, colour depth and low light performance… is the ultimate definition of boredom. I have no interest in ever owning a camera like that again. But… that’s just me… and my specific needs may not be indicative of what the majority of photographers may want.
Since the camera market peaked in 2012 sales volumes have been eroding over time. Smartphones have decimated the lower end of the dedicated camera market. Did that happen because Smartphones had superior photography-related hardware in them? Nope. They killed parts of the dedicated camera market because of convenience and computational photography technologies.
How you choose to assess the OM-5 will reveal how you see the future of dedicated cameras. I see success directly related to the integration of computational photography technologies.
Technical Note:
Photographs were captured handheld using camera gear as noted in the EXIF data. Images were produced from RAW files or from out-of-camera jpegs using my standard approach in post. Photographs have been resized for web use. This is the 1,220 article published on this website since its original inception in 2015.
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Very good points Thomas, I agree OM marketing strategy has changed focusing on a narrower market and recover from the situation Olympus got into.
As for the menu, I believe all brands menus just need some time of usage and one get accustomed to and “custom menu” option is all it’s needed to make any menu usable for anyone.
Ciao
Mauro
Hi Mauro,
I agree that one needs to adapt to the menu of whatever camera we happen to be using. I don’t see any problems with the current menu in any of my Olympus cameras i.e. E-M1X and E-M1 Mark III. After learning how to navigate the menu and set up our cameras I find that I rarely need to go into any of the menu settings. For those that I do adjust from time to time, the My Menu feature makes finding those settings very simple and easy.
Tom
I believe the new camera should have the same menu system as the OM-1 at the very least but also an updated sensor and EVF would have been helpful in my view.
Personally i think this release is a quick “knock up” to cash in on the apparent success of the OM-1 and a mistake by JIP.
PS ..if i were to buy an OM-1 today in the uk i would be unable to take it anywhere because the BLX-1 battery is not available to buy at any major camera stores.
Get the supply issues sorted out and bring out an OM-5 with meaningful improvements over the previous model would be my message to JIP.
Hi Stephen,
FWIW I think a firmware update with the new menu may already be in the cards. We have obvious differences in opinion about what OMDS brought to market with the OM-5.
I don’t think the updated sensor and improved EVF would have made sense for OMDS from a strategic marketing perspective. It would have made the OM-5 too close to the OM-1 to achieve a good level of product differentiation, and would not have supported the overall brand strategy of using computational photography technologies to achieve market differentiation. There likely would not have been any margin left in the OM-5 at its target market pricing (i.e. $1,700 in Canada) if those hardware changes were made. Without decent margins there would be no point in producing the OM-5 at all.
These are strategic product marketing choices, likely based on market research done by OMDS. My understanding from some OMDS online sessions I watched today is that the primary target market for the OM-5 is ‘adventure travel’ photographers who enjoy back country hiking, backpack travel and similar activities that have them regularly off the beaten path in remote areas. Apparently that’s why the computational photography technologies, more stringent weather proofing and improved IBIS in the OM-5 were a priority. I think these changes are very meaningful upgrades that dramatically improve the functionality of the OM-5 compared to an EM-5 Mark III.
The old days of Olympus trying to reach broad, generic photography markets are over. That marketing approach was one of the company’s fundamental problems that failed and led to the eventual transfer of its Imaging Division to JIP, and subsequently to the executive management team that runs OMDS.
The shift into a Focus Differentiation strategy may be uncomfortable for some current Olympus owners. For example, Joe Edelman (an outstanding studio photographer who specialized in high end fashion) was an Olympus Visionary who’s specialty was not a good fit with niche market focus being pursued by the OMDS (i.e. nature and adventure travel). So… Joe reported that he declined to renew his contract with OMDS. That was likely a good decision for both Joe and OMDS.
If you spend some time on the getolympus.com website it will become immediately apparent that OMDS is focused on remote, outdoor photography with a strong emphasis on nature. Strategically this is exactly what the company should be doing to succeed. If you go to the photonstophotos website and compared dynamic range performance between the sensors in the E-M1X and OM-1 you’ll find that there is no noticeable improvement.
Tom
You make some good points there tom and i might just come around to OMDS way of thinking more if they get the updated menu in the new camera.
Hi Stephen,
I think there is a reasonable possibility that an OM-5 firmware update which includes the new menu may be forthcoming (just my opinion as I have no inside information). I was thinking about this a little more, and it occurred to me that there may have been some technical glitches with the OM-1’s new menu system. Perhaps OMDS held back the new menu on the OM-5 to make sure that any potential issues with the OM-1’s version of the menu could be updated. Since there are some performance differences between the OM-1 and OM-5 (ND-64 versus ND-16 for example) the new menu would need to be adapted for each model camera.
Tom
I read somewhere that Truepic X is a Sony chip, with Sony-developed firmware, instead Truepic IX is Unix-based, so no way to “port” firmware but they need to rewrite it from scratch to adopt it in OM-5. I don’t know if they intend to do this, I hope so, maybe they weren’t ready to put OM-5 out before Christmas (yes, time-to-market is important), we will see.
Just a couple of other glitches holds OM-5 a bit back:
– micro USB (EM1III has USB-C, so I they saved all money to swap connectors here…)
– lack of joystick
Some complaints about EVF, I don’t have an idea on this.
Had they fixed those cons above, including menu, it would have been a perfect second body to OM-1. But maybe to some it would have cannibalised sales of OM-1 too much.
Hi Leonardo,
You raise a very interesting point about OMDS potentially having to develop a new menu design from scratch for the OM-5 due to the potential difference in the chips used in the OM-1 and OM-5. This would have chewed up a lot of R&D investment that could be used to potentially generate better ROI for other projects.
Tom
Thomas,
Very well thought out article which I agree totally. I love both my EM1Xs as I and they go into harsh desert environments. I also use the EM5 Mkiii for my youtube videos. Lately, I have been wrapped around the axle with drone photography, not videography, but photography. I think it is a one and two thirds sensor … so what. It’s the get out and make photos thing, and the drone has reinvigorated me.
V/r
Randy
Hi Randall,
It is always great when we are reinvigorated! Interesting to learn that you are having a lot of creative fun using drones.
Tom
I don’t quite see why some people were so down. I have an e-m1 iii and e-m5 iii which is my hiking/I’m trying to save every ounce camera, replaced the e-m1 iii with the om-1, but every time I take the e-m5iii I find I miss the computational stuff and was always thinking, if they could only put the e-m1 iii ‘extras’ into that smaller body (which I do like the form factor). That would be cool. Other than the auto autofocus subject tracking on the om-1 the HHHR and other computational goodies work almost as well on the e-m1 iii (albeit slower due to the slower processor). So I’m totally fine with it and plan on replacing my e-m5 iii with the om-5, the e-m1 iii was a great camera so if I can get those extras in the smaller body great. Sure, a few things like the usb-c would be nice, but come one, it’s not that big of a deal. I imagine being small they only have so much R&D and why have to retool for minor things like that. As long as the camera charges…, likewise the updated display/evf on the om-1 are “nice” but at the end of the day, it is not like the image quality cares. I don’t know, people just like to complain. I’m buying it.
Hi Ben,
For whatever reason some folks get fixated on relatively small items… turning molehills into mountains. When I took a quick glance over the specs my first thought was that many photographers would love to have all of that computational photography technology packed into a small, lightweight body like the OM-5. To me it seemed like a ‘no brainer’ for a lot of folks. Rather than focus on what something doesn’t have, I’ve always found it is far more productive to focus on what something does have and how I can use it. My guess is that Robin Wong may not use a lot of the computational photography technology that is available and may not fully understand the value of it. Robin does produce a lot of really good, helpful content.
Tom
Very enlightening article, Tom. Thanks.
You’re welcome Bill… just my interpretation of things… no inside information claimed.
Tom
Agree with most of what you are saying. Yet, there IS one fundamental strategic mistake OMDS made with the OM-5: not updating the menu system.
The message that sends for now is left to interpretation but terrible either way.
If it says that they will go back to the old-style menu system (which I strongly doubt), that would make the OM-1 stand out as the sore thumb: Oly users who did not upgrade won’t do it, waiting for an OM-1 version with the menus they are used to.
If it says “well, we didn’t have the resources to make the change in this camera, but trust us, the OM-1 way is the future”, it makes the OM-5 look old from the get-go.
This won’t get any better by OMDS keeping mum about it. There are many OM-1 owners looking for a second body as backup or just to broaden their gearset with a smaller, lighter option. As the current owner of two OM-1s, I am one of them and had contemplated getting an OM-5. With the menus being way different, do I really want that? Surely not.
Hi Luthar,
Thanks for your comment and expressing your concerns about the OM-5 using the same menu as the EM-5 Mark III. Perhaps a future firmware update will align the OM-5 with the OM-1.
I have no interest in the OM-1, OM-5 or any other new gear so the differences in menus doesn’t really affect me. From my perspective I’d be more concerned about having to use a different size battery and charger.
I suppose having two menus it isn’t any different than if a photographer was shooting with two different brands of camera in terms of using different menus. You’ll have to decide if having a different menu in the OM-5 is a deal breaker for you, or if it is a trade-off you are willing to make to get all of the computational photography technologies in a smaller, lighter package that the OM-5 represents.
Tom
For me, I would take another OM-1, it’s absolutely positive to have perfectly comparable interface to switch between if you shoot with 2 bodies/lenses in the field, fiddling with different menus, controls and batteries is bothersome at least.
I’d like an OM-X though, when I had E-M1X I found it had the best ergonomy of all cameras I had or tried. And not that heavy at all. Weight comparable to my previous Sony A9 with grip permanently on.
Hi Leonardo,
I agree that it is beneficial to have matching bodies if a photographer regularly shoots with 2 bodies. That’s one of the reasons why we purchased a pair of E-M1Xs for our business. I also concur with your experience with the handling and ergonomics of the E-M1X. Like you, I find it to have the best ergonomics of any camera that I’ve ever used. That’s big reason why I have absolutely no interest in changing from the E-M1X.
Tom