Why process image files? Here's why...

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I'd modify this description slightly based on my knowledge of Nikon NEF files. Raw "data" is captured on the sensor and processed to a limited extent. But the NEF file has further processing to embed information to render the file including ICC color data, EXIF data, and create three different embedded JPEG files plus an embedded XMP file. The embedded XMP file contains a lot of information about the picture control settings, noise reduction, lens corrections, Active D-lighting, and more. With recent cameras, Adobe is using a lot more of this information to apply the profile and other settings to the RAW file, or allow alternative settings. Nikon has used this data for years in it's own software, and it could be licensed by others.

I suspect Adobe has incorporated standards to enhance compatibility with camera makers, and camera makers use those standards to improve communication and processing. Everything does not need to be a created from scratch, and it's in camera companies best interest to produce data in a format that can be read and interpreted by others.
I agree, Nikon (as one example) and other camera manufacturers embed a lot of metadata in their raw files, and their own raw processing software typically uses that metadata when developing the raws. However, (continuing with the Nikon example) much of that metadata refers to features and algorithms that are proprietary to Nikon and are not openly specified or strictly defined. For example, take Active D-lighting. Sure, we generally know what it does, but has Nikon actually published a detailed specification of active D-Lighting so that 3rd party raw developers can follow Nikon's spec to produce the same exact output that Nikon does? No. Instead, other raw processor software developers are each separately creating their own implementation of these settings, trying to match Nikon's camera output as closely as possible (if that's even a goal of theirs; often it isn't).

Beyond the camera settings metadata, there are still many technical decisions that Adobe, C1, Luminar, Darktable, DXO, Iridient, etc. all have to make in order to render raw data, and those decisions effect the aesthetics of the developed image. I'm thinking of things like demosaic algorithms, camera-specific color profile matrices, LUTs, tone curves, baseline exposure offsets, and default contrast & saturation that are part of a raw processor's initial rendering of each camera's raw data. None of this stuff is typically or even ever provided in cameras' raw metadata, and it can't be because some of it is specific to particular raw processors (like ACR's baseline exposure offsets).

Ultimately my view is that image file formats like JPG, TIF, HEIC, PNG, etc all contain fully-baked image data that is fairly strictly defined. While the image data may need to be decoded from the storage format into an actual array of pixel data, it doesn't need to be developed through a long processing pipeline consisting of many subjective elements. All else being equal, a JPG will look the same when viewed in LR vs Preview vs ACDSee vs Windows Photo Viewer vs whatever.

But raw files are different. "Decoding" the storage container (NEF file) is just the beginning. Then you also must take that raw data and push it through an extensive image processing pipeline that wasn't strictly spec'ed by any camera manufacturer and is in fact a different processing pipeline in each raw developing software package. This is why when you open a raw file in LR with default settings it looks different than C1 at default settings, which looks different from Darktable at default settings, and so on and so forth. Each raw processor has its own "look" applied to the image. Some, like Adobe, go to great lengths to copy the camera manufacturer's looks and even peek into that metadata that you described above to do a better job of copying that look. But most do not.
 
I agree, Nikon (as one example) and other camera manufacturers embed a lot of metadata in their raw files, and their own raw processing software typically uses that metadata when developing the raws. However, (continuing with the Nikon example) much of that metadata refers to features and algorithms that are proprietary to Nikon and are not openly specified or strictly defined. For example, take Active D-lighting. Sure, we generally know what it does, but has Nikon actually published a detailed specification of active D-Lighting so that 3rd party raw developers can follow Nikon's spec to produce the same exact output that Nikon does? No. Instead, other raw processor software developers are each separately creating their own implementation of these settings, trying to match Nikon's camera output as closely as possible (if that's even a goal of theirs; often it isn't).

Beyond the camera settings metadata, there are still many technical decisions that Adobe, C1, Luminar, Darktable, DXO, Iridient, etc. all have to make in order to render raw data, and those decisions effect the aesthetics of the developed image. I'm thinking of things like demosaic algorithms, camera-specific color profile matrices, LUTs, tone curves, baseline exposure offsets, and default contrast & saturation that are part of a raw processor's initial rendering of each camera's raw data. None of this stuff is typically or even ever provided in cameras' raw metadata, and it can't be because some of it is specific to particular raw processors (like ACR's baseline exposure offsets).

Specifically for Nikon and Active D-Lighting, on the newer cameras there is specific information in the RAW file used by Lightroom to render adjustments to the file on Import. This is not in the camera profile but an adjustment much like a preset and generates slider settings with different adjustments depending on which ADL selection is made in the camera. Noise reduction is similar in that Nikon builds noise reduction into the file settings and depending on the camera and ISO, the sharpening and NR adjustments are applied to LR. I'm pretty sure that the values are the same in LR as they are in the embedded XMP.

This is not the case for all cameras and all settings - it's an evolving process. Five years ago LR completely ignored most of these settings.
 
Specifically for Nikon and Active D-Lighting, on the newer cameras there is specific information in the RAW file used by Lightroom to render adjustments to the file on Import. This is not in the camera profile but an adjustment much like a preset and generates slider settings with different adjustments depending on which ADL selection is made in the camera. Noise reduction is similar in that Nikon builds noise reduction into the file settings and depending on the camera and ISO, the sharpening and NR adjustments are applied to LR. I'm pretty sure that the values are the same in LR as they are in the embedded XMP.

This is not the case for all cameras and all settings - it's an evolving process. Five years ago LR completely ignored most of these settings.
Glad to hear it. Any progress that allows 3rd party raw developers to make better use of camera settings metadata is very welcome indeed!
 
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