The world is changing fast for Sigma Chief Executive Kazuto Yamaki.
The leader of the Japanese camera lens manufacturer has some successes on its hands, most notably the recent 35mm f1.4 DG lens that's brought new cachet to the Sigma brand. But at the same time, new contenders in the camera market have shattered the stable dominance of Canon and Nikon.
Camera makers old and new have begun jockeying for dominance in the chaotic world of small "mirrorless" models that bring interchangeable lenses to cameras much smaller than traditional SLRs. Contenders there include Sony, Fujifilm, Panasonic, Olympus, Samsung, Pentax -- and more recently, Canon and Nikon as well. Only Panasonic and Olympus cameras can accept each other's lenses, so a third-party lensmaker like Sigma, Tamron, Tokina, or Zeiss must pick its battles carefully.
Even the old SLR market is fragmenting. A lensmaker must support two major varieties of Canon and Nikon SLRs: high-end models with full-frame image sensors as big as a frame of 35mm film from the olden days, and less expensive models with smaller "APS-C" sensors. Though many pros and enthusiasts opt for the expensive full-frame models, they're too expensive for most buyers.
Oh, and there's one more camera -- Sigma's own SD1 -- but it's hardly smoothed Sigma's business. Along with the related SD series of compacts, the SD1 had the potential to diversify Sigma's revenues and increase its profitability, but the SD1's 2011 debut was crippled by a deal-breaking price of $9,700. A year later Sigma cut the SD1 price to $3,300, and now it's down to $2,300, but the camera remains a rarity. On Flickr, the 37,619 photos taken with the SD1 Merrill edition is only about half the 70,518 shots uploaded Monday with a Canon 5D Mark III.
But Sigma's business has been helped by an easing in the yen's exchange rate, which for years has punished Japanese manufacturers by making their exports more expensive elsewhere in the world.
Yamaki, a tweeting CEO, answered questions about his priorities and the realities of Japanese manufacturing in an interview with CNET's Stephen Shankland. Here's an edited version.
Q: There are a multitude of new lens systems coming onto the market from Samsung, Sony, Pentax, Nikon, Olympus, Fujifilm, and Panasonic. Which lens mounts show the highest sales volume for Sigma, and how do they compare to traditional SLR lens shipments?
Kazuto Yamaki: Of those brands, we supply lenses for Sony, Panasonic, and Olympus. However, we cannot comment on shipping volumes.
How hard is it for Sigma to support so many different proprietary lens mounts?
Yamaki: The biggest challenge we face is staying abreast of the various cameras systems and the changes they experience. We're continually updating lenses with new firmware and technology to ensure that the optics are ideal when paired with the latest camera on the market.
Is it better to put optical stabilization in the lens or the camera body?
Yamaki: It is hard to say because each option has unique advantages. As a camera and lens manufacturer, we believe it to be more versatile to put it in the lens. This allows more freedom of choice for the consumer when purchasing a lens.
Sigma's new 18-35mm F1.8 DC HSM lens looks interesting, especially because of its wide aperture across the whole zoom range. But it's for APS-C sensor cameras only. [The f1.8 design offers a wider aperture even than the f2.8 setting that's generally the fastest available on full-frame zoom lenses, but smaller APS-C sensors have a deeper depth of view for a given angle of view. Going all the way to f1.8 means a smaller-frame SLR can better match a full-frame SLR when a photographer wants a shallow depth of field to blur out backgrounds.] Could you scale the design up to make a 27-53mm f1.8 for full-frame cameras, or would that be too bulky?
Yamaki: Yes, that lens would be very bulky, and it would be challenging to develop that lens for all mounts, especially for Nikon's smaller lens mount fit. Having said that, it does not mean it would be "impossible." We've made significant breakthroughs before and we'll continue to strive for that level of ongoing photographic advancement.
With lower-cost, full-frame digital SLRs (DSLRs) like Canon's EOS 6D and Nikon's D600 entering the market, how big is the surge in full-frame lens sales? What fraction of SLR lens sales are for the full-frame market?
Yamaki: The demand for full-frame DSLR lenses is definitely increasing, especially in the high-end lens category. People who own high-resolution cameras such as Nikon D800/D800E or Canon 5D Mark III are looking for better optics for those cameras. However, APS-C DSLR owners are still the majority, so we will continue to supply products for both types of customers.
Canon and Nikon have been raising prices as they refresh their higher-end lens families. I suspect part of the reason why is an unfavorable yen exchange rate. Does this open an opportunity for Sigma to compete better? Or does the fact that you suffer the same financial circumstances mean you don't have that flexibility?
Yamaki: We remain dedicated to producing quality lenses at affordable prices, and we have become known for that attribute, so we already have a leg up on the competition. Certainly, as we innovate and introduce new technologies and materials, that advancement may come with a cost -- and we will continue to price our equipment as reasonably as possible. We've never been the "cheaper" alternative. More affordable? Yes, but our quality has always been top-notch. We attribute many of our laudable characteristics to our status as an independent, family-owned organization that operates its own factory in Japan. This gives us a freedom and control that is unique in our industry.
How is the foreign-exchange situation changing? There are Japanese government efforts to make changes so companies that export a lot of products will have more favorable finances.
Yamaki: Yes, the recent exchange rate is becoming favorable for us. We make all of our products in our factory in Japan, and we're the only company that does this in our industry. We could have off-shored several years ago, but we chose to stay in Japan to provide the best quality products. Also, we're still purchasing most of the materials and parts from suppliers in Japan who have been doing business with us for a long time. We believe we have a responsibility to support our business partners by maintaining that business. I still think the Japanese yen is strong, but the situation is definitely becoming beneficial for our company.
How many of your lenses are manufactured in Japan? Can you move manufacturing to lower-cost areas such as China to become more competitive on prices? What are the drawbacks of doing so?
Yamaki: All of our lenses are manufactured in our Aizu factory in Japan. There, they are all subject to our new, proprietary modulation transfer function (MTF) measuring system called "A1" (named in honor of the company's Aizu factory).
Could we move those operations to other countries to lower prices? Probably. Will we? Absolutely not. Our success is founded on the control that we have over the R&D and the manufacturing of our products. Our executive team is extremely hands-on. We're designing products that fill a void in the industry and provide photographers with new, expressive power. That's a level of involvement and control that we're not willing to give up. We're just not interested in sacrificing quality and uniqueness for lower costs -- and I think we've positioned our products in such a way that we don't have to worry about lowering our costs.
Cameras increasingly can correct lenses' optical problems such as vignetting and chromatic aberration, but of course only for lenses sold by the camera maker itself. How big a problem is this for third-party lens makers such as Sigma?
Yamaki: High-end DSLRs allow for micro adjustments that work effectively in Sigma lenses, too. Sigma will soon release its new USB Dock to help consumers gain more control over their equipment and customize their lenses to their needs. With the USB Dock, consumers will soon be able to connect their lenses to their computers to adjust parameters and update firmware for such fixes.
That said, even with these fixes, customers still need high-performance optics. The more the pixel count grows, the better lens they need. This kind of demand never ends. The software correction can be one answer, but the ultimate solution is always the best quality lens.
How are your R&D priorities changing? Are you investing more toward full-frame lens support,
more toward mirrorless cameras, or what?
Yamaki: We do not believe in focusing on a single aspect of the photographic industry. Our priorities are to provide innovative equipment for every photographer and to be at the forefront of all photographic technologies.
Your company is best known to consumers as a lensmaker. How is your camera business doing with the Foveon-based products? From the outside, it doesn't look the products are successful.
Yamaki: We deem our Merrill cameras a success. They've evolved greatly over the years and the people who use them know their incredible power. Our Merrill cameras are created for serious photographers who value image quality above all else. The camera bodies exude a simplicity and purity that contradicts the complexity of the Foveon sensor inside.
There's an educational curve involved with understanding and adopting this distinctive technology, and we knew this would be the case when we decided to do something different with our camera line. We see these cameras as a success because of the unparalleled detail they produce. This level of image quality can only be seen in medium-format cameras that are at least five times more expensive than our latest camera, the SD1 Merrill. Our compact, DP Merrill cameras were among the first high-resolution compacts on the market, and they remain quite competitive price-wise. We now offer a trilogy of compacts that contain fixed, 19mm, 30mm and 50mm lenses, respectively. We're very proud of these cameras.
Sigma is gaining new attention, in particular with the Art series of lenses with good optical performance, fast apertures, and high build quality. Does Sigma want to be the next Zeiss, a premium brand?
Yamaki: With the launch of the new Global Vision lenses, Sigma addresses an industry demand for quality products that photographers of all levels will embrace. It isn't just the Art line that reflects this quality. All three categories of lenses: Contemporary, Art and Sport, are built with top-notch optics and each lens is tested on Sigma's state-of-the-art, proprietary modulation transfer function (MTF) measuring system called "A1."
We have defined lens categories to help our customers select lenses that best suit their needs, and we've updated the build, performance, and quality control measures to deliver standout products to the market. We view ourselves as a unique brand that fills gaps in the industry, while pushing the envelope with powerful, new technological advancements that are accessible to all photographers.