The action camera maker is searching for revenue streams to turn the company back into profits
The action camera maker, GoPro Inc. is finding it harder to penetrate into smartphone market. The smartphone market is already saturated and people have the access to compact and lighter devices which have considerably good cameras.
Just a decade ago, the San Mateo, Calif. firm gained extraordinary success with its portable cameras that could be accompanied by skiers, surfers, and other similar extreme-sports athletes anywhere they want to take.
Last year, the action camera maker failed badly when it launched its first everyman camera on an exorbitant price. Moreover, the company wasn’t prompt in resolving the bends and curves which made the usage of the device a lot difficult. Currently, it is trying to convince other companies to assimilate GoPro cameras into their products which range from cars to baby bouncers.
The risk is high for the action camera maker. For the current year, the $2 billion company expects its revenue to decline by close to 17%. This will be the first time for the tech firm to encounter a sales decline since its sales of flagship product in 2010. Last year, the company posted sales figure of $1.62 billion. According to an analyst at S&P Global Market Intelligence, in comparison with last year’s same period’s profit of $36 million, the company might suffer a loss of $167 million.
While talking about the company’s intended penetrance in other markets, the President of GoPro, Tony Bates cited that the vision of the company has never only been to conquer the extreme sports arena however there are others areas which the company would like to enter into.
The competition against the companies which manufacture “do-it-all smartphones” is a lot tough. Nowadays, tech giants like Apple and Samsung Electronics are developing such smartphones which are of higher quality and answer to almost every need of the users. Companies like AliphCom Inc.’s Jawbone and Fitbit Inc. had to debunk major chunk of the market share once Apple Watch entered into the scene. The Watch let the users to sync it with their iPhones. On the issue, a senior research analyst at Dougherty & Co., Charles Anderson cited: “Is the person who was going to buy a GoPro to take pictures of their baby going to, now that they can use their iPhone? Probably not, [since] smartphones have caught up with the video quality that GoPro cameras had.
Back in 2004, when the company had commenced its business of selling the cameras, the cellphone cameras too hit the market but they were not of good quality. The major turnover for the company came in 2010 when it launched its blockbuster HD Hero –the palm sized compact waterproof camera device had the ability of high-definition filming –which became highly popular among surfers and skiers. The device became the best seller and, according to market-research firm NPD Group Inc. held close to 70% of the U.S. video-camera market. According to the company, it has sold over 20 million cameras.
However, over the years, the quality of the smartphones’ cameras became significantly better. In 2014, the South Korean tech giant, Samsung, released a water-resistant smartphone. Apple has assimilated 4K high-resolution video and used higher density of pixels.
Last July, the company launched a stripped down ice-cube sized camera which targeted the more placid customers and not the usual targeted audience of enthusiastic athletes, surfers, and skiers. But, the camera couldn’t generate many sales. The action camera maker initially released the camera with a price tag of $399, however, due to disappointing sales, it slashed down the price and, at first, brought it to $299 and later at $199. This move let the company to lose around $40 million in revenue, as per the company’s filing.
But the company is struggling harder to get its lost revenue and share back. It’s highly anticipated drone is expected to be released sometime later this year. Additionally, last month, it launched six-camera rig for the capturing of virtual-reality video.