Nikon Acquires RED

[rangerider]

We dont know how many cameras Red sells vs their licensing revenue and we don't know how little Nikon paid for it. That's the essence of the business case.

Strategically it's a head-scratcher. I can put a PowerPoint deck to explain why it's a good idea and a longer one explaining the opposite.

There is no overlap in the customer base. RED Kommodo customers, if they use a hybrid, are Canon shooters. RED Raptor customers are rental houses that don't carry stills cameras. So I read what they say, but with a grain of salt/roll of eyes.

Let's see what they do with it. In the meantime, RED Kommodo comes off the list of "possibly getting."

I do agree with you on a lot of what you're saying, the base users definitely don't overlap all that much. It would be odd if Nikon buys RED to slap their own name on a $50k cinema rig. I think they'd be looking to compete with Canon and Sony in the "more accessible" cinema space and budgets, which would complement their hybrid line as it does the other two companies.

Nikon had to have known that RED users would mostly leave and they'd essentially be relying on their Nikon users, especially since a lot of RED users are Canon users. To me it feels like Nikon got into a patent battle with a relatively small American company, they were prepared to squash them, came to a deal with a retiring founder, and are now going to essentially strip the company for parts and use it as a base to build out a cinema line similar to Sony and Canon. Milk what they can from the remaining licensing contracts set to expire soon, port whatever technology they can to Nikon's hybrid line, as well, like GS, codecs, color, etc.

 

[JAJohnson]

Strategically it's a head-scratcher. I can put a PowerPoint deck to explain why it's a good idea and a longer one explaining the opposite.

I’m looking forward to what Nikon executives share in their upcoming annual report on May 9. Experience tells me that commentary on this acquisition will be minimal but what they choose to share might be revealing.

 

[Nimi]

I do agree with you on a lot of what you're saying, the base users definitely don't overlap all that much. It would be odd if Nikon buys RED to slap their own name on a $50k cinema rig. I think they'd be looking to compete with Canon and Sony in the "more accessible" cinema space and budgets, which would complement their hybrid line as it does the other two companies.

Nikon had to have known that RED users would mostly leave and they'd essentially be relying on their Nikon users, especially since a lot of RED users are Canon users. To me it feels like Nikon got into a patent battle with a relatively small American company, they were prepared to squash them, came to a deal with a retiring founder, and are now going to essentially strip the company for parts and use it as a base to build out a cinema line similar to Sony and Canon. Milk what they can from the remaining licensing contracts set to expire soon, port whatever technology they can to Nikon's hybrid line, as well, like GS, codecs, color, etc.

Bingo.

 

[Nimi]

I’m looking forward to what Nikon executives share in their upcoming annual report on May 9. Experience tells me that commentary on this acquisition will be minimal but what they choose to share might be revealing.

There might be more info in their annual report. They're pretty opaque usually.

 

[John Navitsky]

while i don't know much about this space, i am skeptical nikon is looking just to strip red.

random thoughts:

1) even if red was failing, being acquired by a larger company with deeper pockets often is a way to allow that smaller company to give the smaller company the time and resources to make adjustments to success

2) nikon probably doesn't need them to be profitable. obviously, they probably want that, but they probably don't *need* that

3) we've seen how nikon has been willing to play the the long game. who would have predicted a few years ago that nikon would be where it is in the mirrorless field?

4) even if red isn't the biggest player, it probably doesn't *need* to be for it to be beneficial to nikon. i don't know where they sit in their space, but even if they are like third or fourth, simply maintaining that spot is beneficial for both red, nikon AND red's customers

5) as others have said, one of the potential benefits here (besides actual ip) is simply having propping up red to maintain (and over time, potentially strength) their position, it lends credibility for nikon in the space _in between_.

6) if this provides nikon a vehicle to develop cine lenses, that would be a huge growth potential for a company that has shown it has the chops to build outstanding glass

7) there are clear potential benefits for each player. having improved af technology could benefit red. having access to advanced sensor design capability benefits nikon. having the ability to build processors like (but also, beyond) the expeed7 would benefit red.

8) letting red die would allow competetors to further lock down that space. holding what ya got is an advantage in itself.

 

[abc123brian]

Bingo.

Out of curiosity from your post regarding Oscar cinema cameras, I did some online searching and it is clear ARRI is dominating currently. Based on the info and the conclusion you came to using number of films to feature specific cameras, it may also be assumed that Sony and Panasonic are also dead which I doubt is an accurate assumption. I would think that since many of these cameras are rented that the best cameras at the time will be chosen. I am not in this field and I know you more into it and have many connections, but I think you might be jumping to conclusions here. With relatively small companies like RED, there can often be hard decisions to be made whether because lack of resources, capital, ability to scale... so potentially that is where they see Nikon can help. Clearly outside of Nikon’s senior leadership, no one knows specifically what any of this means. I am very curious to what the plans are, but for me, the most cinema camera I would see myself looking into is something like the FX3/FX30 so none of it really matters.

 

[rangerider]

The market has been moving further and further towards video for the last 5 years or so, maybe longer, with social media companies making early bets and dictating a lot of the public content creation around the medium. A lot of photographers on Instagram, for example, were forced to take video seriously or lose their massive audiences. YouTube is creating more millionaires than any other platform. As much as we all love stills, the market was flooded with photographs and the barriers to entry have come down tremendously—everyone is a photographer now. So presently, at least, video still has a higher barrier to entry, although that's going to shift, as well. But the manufactures have two markets here and are not stupid: 1) the "creator" market for video, which is growing each year, and 2) the Hollywood cinema scene, which is probably going to take a hit here with both AI and the fact that video creation's barriers to entry are slowly coming down like photography's did. Creators are going to be where the money is at long-term because of the sheer numbers of people making video, and they want upgrade paths.

All of this to say, if I'm Nikon, and I'm lagging my main rivals in Sony and Canon, who have a much more developed video business and cinema line, I'm not wanting to get left behind. It's been a criticism of Nikon for some years now, that they're very stills oriented and less concerned about video relative to the other two, and I know the Z8 and Z9 are fantastic for hybrids, but it's not the same for those looking for upgrade paths and for Nikon to be taken seriously in the space.

Many of us who say we'll only be shooting stills will likely be dabbling more and more into video in the coming years, just as we do with all technology. Remember all the DSLR shooters that said they'd NEVER move to mirrorless? Or film shooters who would NEVER move to digital? Video is happening, and IMO Nikon, as proud as they are, sees that future clearly and is not content to sit back and let Canon and Sony dominate the space. They can offer the market hybrids like the Z mirrorless bodies and lenses, use RED for parts to make their own FX-like competitors eventually, and milk RED in the meantime for its present licensing and camera offering revenues until they launch their own versions. I personally don't see them keeping the RED branding forever and not putting their own name on it like Canon and Sony have, but that's just a hunch. If I had to guess there will be a long, drawn-out transition, where they capitalize on RED's income streams, but position Nikon as the sole long-term branding.

 

[Nimi]

Out of curiosity from your post regarding Oscar cinema cameras, I did some online searching and it is clear ARRI is dominating currently. Based on the info and the conclusion you came to using number of films to feature specific cameras, it may also be assumed that Sony and Panasonic are also dead which I doubt is an accurate assumption. I would think that since many of these cameras are rented that the best cameras at the time will be chosen. I am not in this field and I know you more into it and have many connections, but I think you might be jumping to conclusions here. With relatively small companies like RED, there can often be hard decisions to be made whether because lack of resources, capital, ability to scale... so potentially that is where they see Nikon can help. Clearly outside of Nikon’s senior leadership, no one knows specifically what any of this means. I am very curious to what the plans are, but for me, the most cinema camera I would see myself looking into is something like the FX3/FX30 so none of it really matters.

You'll love the FX3, I love mine.

In the big-budget/crewed catagories Arri continuous to dominate. Sony is climbing with Venice II and now Burano. Panasonic is used for broadcast, not for film. These are all PL mount cameras with fully-rigged costs of $100k +. No AF. RED was a contender with Raptor, but has seen declining share since 2018.

On the "content creator" side, there are dedicated cine cameras like the Sony FX3, FX6; The Canon C70, R5C; RED Kommodo and others. There also hybrid cameras, which is basically every new mirrorless on the market.

RED is straddling the two markets with two models with small and declining market share. I don't know what Nikon would do with it.

 

[abc123brian]

You'll love the FX3, I love mine.

In the big-budget/crewed catagories Arri continuous to dominate. Sony is climbing with Venice II and now Burano. Panasonic is used for broadcast, not for film. These are all PL mount cameras with fully-rigged costs of $100k +. No AF. RED was a contender with Raptor, but has seen declining share since 2018.

On the "content creator" side, there are dedicated cine cameras like the Sony FX3, FX6; The Canon C70, R5C; RED Kommodo and others. There also hybrid cameras, which is basically every new mirrorless on the market.

RED is straddling the two markets with two models with small and declining market share. I don't know what Nikon would do with it.

My opinion where Nikon would offer the most value would be with the creator side cameras and see this as where the most collaboration would be of benefit to both companies. They may also be needed to finance some of the RD on the big budget side of the house. It will be interesting to see where it leads.

 

[Nimi]

My opinion where Nikon would offer the most value would be with the creator side cameras and see this as where the most collaboration would be of benefit to both companies. They may also be needed to finance some of the RD on the big budget side of the house. It will be interesting to see where it leads.

Z9 innards - Komodo body - Raptor [X] sensor - Nikon AF - built-in ND - $8,000 - Z mount and OEM PL adapter.

 

[abc123brian]

Z9 innards - Komodo body - Raptor [X] sensor - Nikon AF - built-in ND - $8,000 - Z mount and OEM PL adapter.

and possibly some other lower end options for the less demanding videographer for events, weddings,

 

[Nimi]

and possibly some other lower end options for the less demanding videographer for events, weddings,

The current line up is already there and the Z50 has been gaining a following among YouTubers. Cameras are so good today, from all brands, I am not sure what will happen to the next generation of $2,000 cinema cameras. I think the line will be completely blurred.

The FX3 you are considering, which is essentially an A7siii with a fan and a different body is probably the best video camera under $4k and once it gets 6k and maybe built-in ND, it will be untouchable.

 

[Alistair]

I don’t think Nikon will allocate any of it’s lens development resources to producing lenses using other lens mounts.

Possibly, but I cannot imagine a RED branded lens being available only in Z mount.

 

[Nimi]

Possibly, but I cannot imagine a RED branded lens being available only in Z mount.

RED had marketed (and failed) rebadged Tamron lenses. Nikon to my knowledge does not make lenses in anything but F and Z mounts.

The mounts that count today are E, L, EF, RF, Z, and PL.

 

[Alistair]

RED had marketed (and failed) rebadged Tamron lenses. Nikon to my knowledge does not make lenses in anything but F and Z mounts.

The mounts that count today are E, L, EF, RF, Z, and PL.

Rebadging Tamron lenses is one thing. Nikred introducing a new cine series of its own design/manufacture is quite another. The new S lens series has worked out quite well for them.

 

[abc123brian]

The current line up is already there and the Z50 has been gaining a following among YouTubers. Cameras are so good today, from all brands, I am not sure what will happen to the next generation of $2,000 cinema cameras. I think the line will be completely blurred.

The FX3 you are considering, which is essentially an A7siii with a fan and a different body is probably the best video camera under $4k and once it gets 6k and maybe built-in ND, it will be untouchable.

Agree with blurring the lines in the $2k range. I’ve looked at the LUMIX S5iix a few times as well. The thing I keep coming back to is that I have a Z9 already along with Z lenses and I’m not doing anything at this time that would really benefit from the cinema specific body.

 

[Nimi]

Rebadging Tamron lenses is one thing. Nikred introducing a new cine series of its own design/manufacture is quite another. The new S lens series has worked out quite well for them.

Sign me up. The Z can't be adapted, so they need licenses, join the L alliance and go to town. I'd absolutely love a Nikon cine lens. I don't know what my next cine body will be, but PL is a safe choice because they are easy to adapt and all the top cameras have that mount. I'm not sure, but I think they don't need a license from Arri for that.

Coincidently, RED signed up with Arri to make a body specific to the Arri DNA line of lenses (smaller, historic, rehoused lenses).

They shouldn't name it RED though. It carries too much baggage because of their experiment. Nikon is very respected in optics. Fuji, which doesn't make a cinema camera (although it's probably coming) sells tons of high-end PL lenses.

 

[Nimi]

Agree with blurring the lines in the $2k range. I’ve looked at the LUMIX S5iix a few times as well. The thing I keep coming back to is that I have a Z9 already along with Z lenses and I’m not doing anything at this time that would really benefit from the cinema specific body.

The Lumix is very well regarded, but gives you very little if anything over the Z9. And doesn't have lenses as good as the Z lenses. Have you considered the Zf? The files at 4k are indistinguishable from the Z9, which makes combining clips very easy. Near impossible when you mix, say a Sony with a Nikon.

 

[abc123brian]

The Lumix is very well regarded, but gives you very little if anything over the Z9. And doesn't have lenses as good as the Z lenses. Have you considered the Zf? The files at 4k are indistinguishable from the Z9, which makes combining clips very easy. Near impossible when you mix, say a Sony with a Nikon.

I recently bought a Zf to be my casual and travel photography camera with the idea of using it for some video as well.

 

[Alistair]

Sign me up. The Z can't be adapted, so they need licenses, join the L alliance and go to town. I'd absolutely love a Nikon cine lens. I don't know what my next cine body will be, but PL is a safe choice because they are easy to adapt and all the top cameras have that mount. I'm not sure, but I think they don't need a license from Arri for that.

Coincidently, RED signed up with Arri to make a body specific to the Arri DNA line of lenses (smaller, historic, rehoused lenses).

They shouldn't name it RED though. It carries too much baggage because of their experiment. Nikon is very respected in optics. Fuji, which doesn't make a cinema camera (although it's probably coming) sells tons of high-end PL lenses.

This is where Nikon is going to have to be careful. As you know, the video world is incredibly brand conscious, much more so than stills. For those commissioning video, Nikon is not cool. RED is. This is the biggest asset of the acquisition IMO. Nikon need to tread the fine line of enhancing their Nikon branded hybrid credentials with the RED brand probably through compression algorithms, colour science, video-centric UI etc. whilst also enhancing RED's "proper video" credentials with the Nikon brand, probably through glass, AF, manufacturing prowess etc. And while doing that, don't make the RED brand "uncool" LOL

 

[Alistair]

Z9 innards - Komodo body - Raptor [X] sensor - Nikon AF - built-in ND - $8,000 - Z mount and OEM PL adapter.

YES, that is quite feasible. The Z mount could become a "master mount" as its dimensions support adaption to all other mounts. And then a set of adapters that work as seamlessly as Nikon's FTZ or Canon's EF to RF adapter.

 

[rangerider]

This is where Nikon is going to have to be careful. As you know, the video world is incredibly brand conscious, much more so than stills. For those commissioning video, Nikon is not cool. RED is. This is the biggest asset of the acquisition IMO. Nikon need to tread the fine line of enhancing their Nikon branded hybrid credentials with the RED brand probably through compression algorithms, colour science, video-centric UI etc. whilst also enhancing RED's "proper video" credentials with the Nikon brand, probably through glass, AF, manufacturing prowess etc. And while doing that, don't make the RED brand "uncool" LOL

I agree with you here. Just based on my own time and research in the RED community over the years, they seem to have a strong following with the 1-3 person crew run-and-gun types on the lower end, and a LOT of these guys are shooting Canon, as well; and then obviously you've got the full-blown Hollywood productions on the high end. I honestly think Nikon is going to lose most of these users, frankly, as you said largely due to the brand association. Hollywood types will continue shifting to ARRI and Sony because Nikon is more stills associated for now, and the RF Canon guys on the lower end will probably be upset about this deal because it will limit the RED/Canon licensing perks over time.

IMO Nikon shouldn't lose sleep chasing these users and instead play the long game with their own line. Milk RED for its present licensing deals for as long as you can, keep the RED offerings the same for those who continue to want to buy them, maybe even producing a few more updates to them, and simultaneously start beefing up the Z hybrids and thinking lower-end FX-like competitors under the Nikon branding. That way you're not really cannibalizing your RED lines just yet and can slowly synergize and build this thing out right without a lot of Frankenstein products.

 

[Nimi]

I recently bought a Zf to be my casual and travel photography camera with the idea of using it for some video as well.

I use mine for the B-roll and timelapse. Its files are as good as the Z9 and most importantly the match.

 

[Alistair]

I agree with you here. Just based on my own time and research in the RED community over the years, they seem to have a strong following with the 1-3 person crew run-and-gun types on the lower end, and a LOT of these guys are shooting Canon, as well; and then obviously you've got the full-blown Hollywood productions on the high end. I honestly think Nikon is going to lose most of these users, frankly, as you said largely due to the brand association. Hollywood types will continue shifting to ARRI and Sony because Nikon is more stills associated for now, and the RF Canon guys on the lower end will probably be upset about this deal because it will limit the RED/Canon licensing perks over time.

IMO Nikon shouldn't lose sleep chasing these users and instead play the long game with their own line. Milk RED for its present licensing deals for as long as you can, keep the RED offerings the same for those who continue to want to buy them, maybe even producing a few more updates to them, and simultaneously start beefing up the Z hybrids and thinking lower-end FX-like competitors under the Nikon branding. That way you're not really cannibalizing your RED lines just yet and can slowly synergize and build this thing out right without a lot of Frankenstein products.

You are probably right but maybe, just maybe they can hang with the cool kids. They would need a serious influencer campaign as that is what tends to hold sway in that particular echo chamber.

 

[Nimi]

This is where Nikon is going to have to be careful. As you know, the video world is incredibly brand conscious, much more so than stills. For those commissioning video, Nikon is not cool. RED is. This is the biggest asset of the acquisition IMO. Nikon need to tread the fine line of enhancing their Nikon branded hybrid credentials with the RED brand probably through compression algorithms, colour science, video-centric UI etc. whilst also enhancing RED's "proper video" credentials with the Nikon brand, probably through glass, AF, manufacturing prowess etc. And while doing that, don't make the RED brand "uncool" LOL

I agree that they need to be careful.

RED has more detractors than fans in the world I'm familiar with. They are used, but most people remember them for being crash-cams, maybe B- but rarely A-roll. GoPro aren't good enough, get a Komodo. And then there is the phone thing. I don't know un-sponsored filmmakers who'd choose a RED over a Venice or an Alexa given the budget and space. And they never made a real lens. Nikon, the Potato Company, is a non-player in cine, but still well regarded as an optics company. And with the move to vintage lenses (Dune II was shot on rehoused vintage lenses, for example), Arri's new DNA line of lenses, etc, I am seeing the prices of Ai-S lenses inching up, and my guess is they will be cinemodded or rehoused.

Maybe there are seeing Nikon shooters who want to move over to cine as the target audience, however small that group is. They will lose the RED customers to Canon, won't get any of the Blackmagic users, Panasonic is going to have some new cine bodies, and Fujifilm will probably introduce something soon too.

I scratch my head and hope Nikon gets it right.