View Full Version : Disappearing profits while enabling the person on the street.


John McCully
April 16th, 2013, 05:52 PM
I know this is somewhat simplistic but perhaps not overly so hence this post.

As the announcements at NAB last week by Blackmagic regarding the new cameras soon (hopefully) to arrive on the scene sinks in I can’t help but wonder what impact this will have on the market place. If just the other day I needed to spend x dollars to purchase a pro camera and now I need only spend say one tenth of x (more or less) then surely not only will this seriously hurt the manufacturer but also the reseller/retailer. Suddenly a huge percentage of the dollars going into this market are...not going into this market. I imagine the rental houses also stand to see profits disappear as no doubt renters will baulk at paying the same rental for a device costing $4000.00 as one costing $24,000.00 (imaginary figures for illustrative purposes only). Not only that but I imagine some folks who would rent a $24,000.00 piece of equipment will just purchase a $4000.00 device.

Seems the winners here are the end users and Blackmagic while the losers include the big name camera manufacturers, the rental houses and the taxation department (not to mention a slew of peripheral people including.the 'expert', and even, yes...DVINFO perhaps!)

Isn’t capitalism wonderful?

Phil Murray
April 16th, 2013, 08:08 PM
I understand what you mean, but I think the bottom line is still talent. The vast majority of video intended to be "artistic" (as opposed to just someone posted video of their children, the family dog, etc.) are just not very good and often just crap. Having access to a good camera will not give someone the ability to make better creations. The crap just looks sharper. ;)

I've been fortunate enough to purchase some fairly expensive equipment and I have decent technical ability, but I accept that I simply do not have the creative talent that so many here on DVInfo have. No matter how much better I get at the craft, I don't think I will have that "something extra" that so many of the great people here have.

(Thank goodness, though, that so many of those wonderfully talented people are willing to share and help people like me get better.)

Sareesh Sudhakaran
April 17th, 2013, 06:31 AM
Seems the winners here are the end users and Blackmagic while the losers include the big name camera manufacturers,

Why? The cost to produce a camera with X ability is actually cheaper for a big name manufacturer. If Blackmagic can make this camera and sell it worldwide for $4,000, imagine how much extra Sony or Canon are charging for their cameras!

But it's not that simple. There are many features that the $4,000 camera will lack. A professional grade camera has a workflow in-built for many shooting scenarios, while a BMCC needs to be rigged, and the workflow isn't that straightforward. You'll end up spending money on other things.

JVC already has a 4K camera selling for $5K. 4K isn't 'enough', it's not even important.

Frank Glencairn
April 17th, 2013, 08:26 AM
In any production I know, the camera rental is way below the line.
Most of the time, more money goes into catering and craft service, let alone the stuff that is going on IN FRONT of the camera and postproduction.

So, as long as the BMC can't make free lunch and coffee, and as long it doesn't replace actors and crew, there is no reason to worry. Cheapish brushes haven't put painters out of business, you still need a lot of good folks to handle all that stuff.

Allan Barnwell
April 17th, 2013, 08:54 AM
Talked to a seasoned broadcaster / stringer about a shoot for MTV. They paid $2500 for the day shoot, which is what he is used to, but they required the 5Dmk2. This was in early 2012. He was not used to shooting on the 5Dmk2. He owns a Panasonic AG-HPX2000. $25,000 rig... I don't know what this means.

Bruce Watson
April 17th, 2013, 09:49 AM
Isn’t capitalism wonderful?

Tell it to Kodak.

Shaun Roemich
April 17th, 2013, 05:35 PM
I'm working on my exit strategy from the industry after 15 years... that's what it means to me.

Shaun Roemich
April 17th, 2013, 05:39 PM
Why? The cost to produce a camera with X ability is actually cheaper for a big name manufacturer. If Blackmagic can make this camera and sell it worldwide for $4,000, imagine how much extra Sony or Canon are charging for their cameras!


It is EXACTLY this sort of ridiculous hyperbole that is killing the industry.

"Company X is ROBBING us blind!"

I'll take a camera that stands a chance of WORKING AS ADVERTISED every time.

BMD screwed up the BMCC release with not getting flange focal distance right. This is an amateur mistake.

Their firmware updates amongst their entire product line break more stuff than they fix.

Check out the BMD Forum if you don't believe me...

Chris Barcellos
April 17th, 2013, 06:42 PM
Come on Shaun, are you kidding ?

Canon, Sony and Panasonic have never had to recall a camera or other device because they had to fix a problem ?

Do you remember Canon 5Ds with bad pixels ?

Seems like there was similar problems with the Sony EX line.

How about this one: Digital Camera CCD Recall Instructions (http://www.darntoothysam.com/pages/Digital-Camera-CCD-Recall-Instructions.html)

And what about the switches on Sony PDs and VX lines that started going hay wire immediately.

And tape mechanisms that start signaling malfunction at the drop of a hat.

I won't even mention the problems that they refuse to acknowledge-- like Sony's initial advertizing that the VG 20 had scene settings....

You seem to be missing a lot along the line.

Shaun Roemich
April 17th, 2013, 09:35 PM
Chris, I understand you are trying to go to bat for the darned thing based on the sheer number of posts you have supporting it but I stand by my statement:

I'll take a camera that stands a chance of WORKING AS ADVERTISED every time.

Sony, JVC and Panasonic have had their fits and starts. Curiously absent is any mention of RED, another company with its fair share of fan boys that has a history of new release missteps. And I know you have been vocal about the VG series scene settings but that PALES in comparison to lenses that CAN'T focus to infinity because a manufacturer didn't bother to resolve flange back. A mechanical interface. The EX series by Sony was an issue with a fairly new phenomenon in the market, which was flange focal distance look-up tables built into a compact video zoom lens. That is a lot of math.

The flange issue on the BMCC to the best of my knowledge is caused by a spring,

BMD has broken or end-of-lined OS support for EVERY single piece of their equipment I currently own.

It is like trying to run an IT infrastructure with an open source OS architecture.

And people are touting these things as the Next Big Thing.

Rubbish!

The Emperor has no clothes on!

Chris Barcellos
April 17th, 2013, 10:40 PM
All I am saying is give the camera a chance. There is no doubt there are changes that we need to the camera. But when the 5D first came out, Canon wasn't listening real close either. It took people pushing the envelope with the hack firmware to get Canon to realize what was going on.

Yes, I have been vocal about the VG 20 and Sony's mistake there. I also recognize why Sony didn't put that capability in the VG20. It was too good, and the FS 100 would have died, much like it seems to be dying now. I still love the VG 20 for its simplicity in many of its features. In some ways it is a lot like the the Black Magic Cimema camera. Very few inputs that the user cam really use to alter the image in camera.

Black Magic has the hope of further updates to make it work better. If they don't fix the deficiences, the one thing I would like to see is someone get into the firmware on that camera. or even have Black Magic make it open source, so the users could move it along.

Now to the camera itself. It is for the independent small film maker what Red was supposed to be. I can remember following Red as it was developed, thinking it was going to me a triumph a great company working with small film makers, to bring out a camera that was affordable for the small film maker. DVinfo had early input into that. But then it started mushrooming into this and that and before long, it was clear that the original market was being abandoned. The promise for the not budget film maker died.

I realize that at this price point, I can't expect everything that cameras twice three and four times the price provide, so I am thankful for the things that are there.

Brian David Melnyk
April 18th, 2013, 12:26 AM
The inevitable evolution of technology necessitates the evolution of business models. I've heard the same complaints about disappearing profits for small recording studios and for record execs alike. I welcome the loss of profits for dinosaurs that have bled artists dry as a business model, and welcome the empowerment of the artists in both the available technology and the new opportunities for independent distribution, promotion, etc. etc.
hard to feel sorry for Canon, and while i have sympathy for smaller companies, evolution won't and should not stop. so evolve or perish...

Sareesh Sudhakaran
April 18th, 2013, 04:22 AM
It is EXACTLY this sort of ridiculous hyperbole that is killing the industry.
"Company X is ROBBING us blind!"


That's capitalism, isn't it? It's funny how manufacturers selling expensive gear also harp about price. You'd think it was important to them!

I'll take a camera that stands a chance of WORKING AS ADVERTISED every time.

The second paragraph actually implies this, so I agree with you 100%. Most amateurs don't see 'far enough' when it comes to feature sets.

I might buy one of the two new BMCC cameras when it comes out, but only as a backup - unless the imagery is so mind-blowing it ends up being the A-cam. I know better than to spend money on unproven technology.

But once something hits the market and finds buyers, it has a chance to get better. The sudden drop from $3K to $1K of the 3K BMCC is quite a shocker, but indicative.

Look at Android phones and phone makers. In the last couple of years, more than ten 'manufacturers' of mobile phones have popped up in my country. None of these have any history, but are obviously owned by those with deep pockets with access to Chinese factories. No legal issues whatsoever.

Don't misunderstand me, Shaun. I'm not asking anyone to get used to it. I'm hoping you see the importance of preparing for it.


BMD screwed up the BMCC release with not getting flange focal distance right. This is an amateur mistake.

Their firmware updates amongst their entire product line break more stuff than they fix.

Check out the BMD Forum if you don't believe me...

Agree, but there are many BMCC users who are happy with their cameras. I'd say they are in the majority. This position is similar to how Red started, and I'll bet Sony and Canon had the same problems.

When you like something you tend to forget its weaknesses. That explains the Red fanboy behavior, but wouldn't you agree that it might also explain Sony or Canon fan behavior? Especially when many have invested years with these companies?

I fully understand it when you say:
It is like trying to run an IT infrastructure with an open source OS architecture.

In my country one can say the same about any manufacturer, except Canon. I have gotten used to the idea of not getting support. Imagine that.

Kevin McRoberts
April 19th, 2013, 07:23 PM
Changing times, changing business models. Manufacturers, renters, professionals, clients, everyone.

Like a lot of small-time ops, I can't buy every camera I might need in the hopes of paying it off. In the past year, I shot professionally on EX1/3, 5D, FS100, HMC150, XF100, HVX200, AF100, GH2, 7D, GoPros... And I only own 3 of those (AF, GH, HVX). As my work evolves and cameras change, I'm just giving more and more money to rental houses.

Eating that depreciation doesn't make sense anymore unless I'm going to use the camera enough to pay for it within a few weeks... Yes, a few weeks, because that's almost the cycle now. One new camera system pops up, gets dumped once the next one is introduced a month or two later, and so on and so on. Black Magic (arguably) obsolesced their EF camera with their MFT camera, and then promptly obsolesced both with their Pocket and 4k announcements, and did that all in the span of about a year while barely producing any of the things. So screw all that. I'm not chasing that snake any more.

I have lights, lenses, support, and skill. I'll happily cling to my few cheap, long-toothed cameras until they absolutely can't do the job, and rent whatever else I need.

Jacques Mersereau
April 22nd, 2013, 08:04 PM
Yup, one of our recent graduates, who has been gaffing for another recent grad who owns a Scarlet Kit, is able to rent it for $100 a day. Okay, granted, he has a good connection with whom he was done a lot of favors for, but seriously, $100 a day for $20K worth of gear? Heck, I used to get that to rent my tripod. The camera rental market is not where I would suggest anyone new investing these days. The established rental houses have all the extras and goodies available and are likely to give a good deal on the camera just so they get the add-ons.

As happened to the publishing industry first, the audio industry next, has been beating on the film/video industry for a while now. From working in the audio industry for years, basically it became a couple of BIG companies who had tons of pro gear and real good engineers to run it, PLUS lots of clients (GM, Ford, Festival Producers, national acts) willing to pay what it was worth. These companies are doing just fine thank you. Then there are the bottom feeders, which ranges from companies with tons of crap gear and so-so engineers whose clients who don't care about anything but low cost. These companies are hanging in there, but not having much fun. Then there are the kids with a bit of gear who are willing to work for almost nothing.
They come and go like the seasons. This biz model spread throughout the audio industry about 10 years ago and hasn't changed. Most of the good engineers I know went to work for the big companies, sold or kept their stash, got real busy and never looked back.

YMMV.

Frank Glencairn
April 23rd, 2013, 05:00 AM
The flange issue on the BMCC to the best of my knowledge is caused by a spring,

Which proofs, that your "best of my knowledge" isn't worth much.

How could a spring cause backfocus issues? Come on?
The BMC was dead on shimmed to the official Canon specs.
As it turned out, that Canon cameras and glass (also compatible glass) in reality use much looser specs.
Now they re-shim it and all is just fine.



Rubbish!

The Emperor has no clothes on!

If the emperor has no clothes on, and the whole thing is rubbish anyway, how could it be a menace to your business in the first place?

And as I said before, camera cost or rental is only a tiny point of the overall budget - way below the line.
Even if cameras would be free from now on, you still need the same crew, transportation, grip, actors, lights, catering andwhatnot.

Josh Bass
April 23rd, 2013, 05:21 AM
To the poster who talked about it earlier--

Are you saying it's near impossible these days to get a reasonable rental rate for your gear? When I quote someone a rate, that consists partially of my labor, and partially of any gear I bring along. Where cameras are concerned, I've found (and someone who used to work at the local Plus8/Panavision told me it was more complicated than this) that rental rates for cams generally fall in the range of 3-5% of the purchase price for a day's rental (e.g. a camera costing $6000 would rent for around $300/day), and I've generally followed suit. By that logic that 20K worth of gear you mentioned should be around $1000/day

To the person who mentioned owning several cams but having to rent many others-
Do you try to be "clever" and hide the fact that you're renting (i.e. pretending you own everything) from the client? I've been advised to do this by quite a few folks. . .there's some kind of stigma attached to not owning whatever is needed, like you're not really a true professional unless you have everything ready to go all the time. I certainly see many ads on Mandy, Craigslist (and yes I know what many of you guys think of those sites to begin with!) specifying that they are looking for a videographer/DP/whatever who "owns his own gear." I've never understood that. . .why do you care if I own or rent? Is the gear more important than the operator? Do you think you're going to get a great deal on price 'cause I own the gear vs renting? I might go a little low compared to a rental house but you're not getting a 75% discount on the gear fee. Curious about your experience with all that.

Jacques Mersereau
April 23rd, 2013, 07:05 AM
I am saying that with a fairly complete Scarlet package going for $100 a day in my area, it has become more difficult to charge 'sustainable' rates. Sure, part of the price can be our labor/expertise if we go out with the gear, but as I said in my previous post, just as happened in the AUDIO industry, it became the huge well equipped companies ($10,000 a day), companies with lots of cheap gear and poor engineers ($400), followed by kids willing to work for $100 a day with not much between.

Your mileage may vary. I hope anyone reading this is able to get lots of good gigs that not only pay your bills, but enough extra to pay the cost of the equipment you use. :-D

However, I do caution those who are new to the biz, and are planning on taking out a huge loan to buy a bunch of gear in the hopes of getting work and being able to make the payments. That's all.

Josh Bass
April 23rd, 2013, 01:43 PM
I wonder if anyone has any experience with "do clients ever learn?"

Typically when people work that cheap, it's cause they're starting out, or don't know their own value (which usually comes with being inexperienced). It's possible it's a pro/veteran who's just desperate that week/month/year, but often there's a good reason people are that "affordable." What I'm getting is, I wonder how often it happens that someone hires someone for cheap, is totally appalled at the resulting footage, and learns for next time that there's a reason everyone else is priced much higher?

Frank Glencairn
April 23rd, 2013, 03:57 PM
Guys look outside the box, it's not just our industry. We are living in the middle of a depression.
The money just isn't there anymore.

Cities such as Detroit, Chicago, Milwaukee, Cleveland, Philadelphia and Baltimore were all teeming with economic activity. Good jobs were plentiful and a manufacturing boom helped fuel the rise of a large and most vibrant middle class. Detroit once actually had the highest per-capita income in the United States.

Once proud cities are being transformed into poverty-stricken hellholes. The exact same thing that is happening to Detroit is happening to cities all over America. Detroit is just ahead of the curve.

And it didn't happen because some company throw a cheap steel press on the market and now the kids in the neighborhood pressing car doors and bodies for 50ct a pop.

I hate to say this, but you have to face it. This is not going to get better anytime soon.
And yes, there will be blood and things in our industry will probably never go back to the way, they where before. Work harder for less, or having a plan B (aka exit strategy and something totally different) are your options. But the easy, cozy times, where clients pay your gear off, and - having 2 gigs a week- was making more than enough money for a comfy life are over. And it has nothing to do with cheaper cameras.

Jacques Mersereau
April 23rd, 2013, 06:35 PM
I respect what you say Frank, but and I agree with some of it, but disagree with other parts.
Yes, we - the 98% - are in a depression and our wages haven't gone up in many decades.

That said, believe me, the huge companies are still doing well. In fact, when some of the lesser ones went under at the height of the depression, they were scooped up for cheap, the weak were bought out = less competition = good money & more biz for a few - the 1%. Meanwhile, many medium and small biz are still hurting. Why? Because the 98% is hurting.

American biz is holding on to $1.7 trillion in cash. There is tons of money, but it is held by a tiny percentage of biz and they and the 1% already have what they need. They are rich, not because they spend money, but because they don't.

Year ago, corporations went overseas for cheap labor and made a killing. We got layoffs and cheap goods in exchange, but most commodities continued to rise: gas, education, cars, energy and housing, but our wages flatlined about 1980.

Meanwhile, as I said previously, cheap gear in printing and audio has HURT the industry. People have bought gear cheap and flooded the industries. Who pays for printing these days? Almost no one.

If you took a poll, I'd bet there were very few people shooting video and film in 1980 because a rig cost $50K-250K. I wanted to get in back then, but the prices were way beyond what I could afford - and that was just for a camera. Today, with $10K you can get a broadcast quality camera, a few lights, laptop and put out great content. The supply has gone up and the demand too, but the supply of people with the capability has outpaced demand and driven rates down.

You are right that it isn't going to change soon. The audio biz is still what it was when I left a decade ago. The band biz sucks worse. The printing biz is tough. And yes, NOTHING is easy. One hopes that talent will make the difference, but - hate to say it, I am not so sure any more. However, doesn't mean I am going to stop.

Al Bergstein
April 24th, 2013, 12:43 AM
An interesting thread. Jacques is right, I'd say. And the OP was onto something. Our industry right now is like the Goldrush. Only the equipment manufacturers are getting rich selling to the chumps heading to the 'gold fields'. Remember, Seattle was built on that model! It's the same as it ever was, though.

I started back in the 70s, ran a small studio doing both advertising stills and multi-projector speaker support and slide shows, which required all the same production work as most film productions (scripts, pro narration, multicamera shoots that closed down major arteries of Seattle on Sunday mornings,etc.). Point being, there were cheap folks working then too. I left that world, for better luckily, and returned a few years ago to this crazy video worldwind. But it seems like the same that it ever was. Difference is now the cost of entry to this world is ridiculously low. (good news!) But it's that way everywhere, not just video production. Gear is cheap. And because of the depression, cheap HD gear and a flood of skateboard videographers, you have another glut on the market, just like when I got my degree in commercial photography in 1978. Another difference? A real global market. We are no longer competing with the West Coast, or the East Coast. It's that way all over. Just ask the FX companies falling right and left. My question to that debate was, "did those folks really know how to run a business?" Or was this really the screw job by Ang Lee that folks say it was.

What doesn't change is that this business is about relationships. They come, they go. Some folks are cool, they gain big businesses, they win the Microsoft and Amazon (or get sucked inside), or production work in the big cities. Look at Chase Jarvis and what he's doing. More power to him. He's doing great work and building his brand. Personal brand building is harder than ever because there are so many outlets! I have no doubt he is working his ass off to keep all these balls going, yet it's the same as it ever was. He looks like every cool studio I apprenticed in in Chicago and gripped in Seattle with in the early 70s, except with video cameras added. There was the three competing 'Mr. Bigs' in Seattle back in 78, getting all the great higher budget work. The young up and comers with a full plate of relationships and business. Even then a lot of work went off to SF, LA or NYC for the Boeings because the prestige was there.Now it's exotic locales everywhere.

You guys are living it and I'm not. I'm just having fun in the sticks. But it's still the game. You guys know the real daily problems and I don't pretend to. But you still gotta find the work and schmooze the clients. You gotta deliver on time and under budget. The 'kids' may or may not know how to do that. I've gotten good paying work because clients have realized that even though I don't have a huge reel of decades of work, I know how to deliver, and do solid lower budget work. That hasn't changed one bit, IMHO. Some of that work is still around.

The "kids" still have to fund a business that needs to make even a one person payroll work every month. They likely have to either have deep pockets from a family connection, a second job, or know how to do work with their banker, a harder task than ever. Does any major client pay in net 30? Unless something has changed that I'm not aware of, it's the same as it ever was.

Anyway, it's been fun. I'm just hacking away and getting interesting work. For those that are talking of throwing in the towel, I understand. I did myself a long time ago. And likely will again when I can't lug the gear. It's ok. There are jobs that aren't 7 days a week out there. (G). Have fun. You only live once. This isn't a scripted show.

John McCully
April 24th, 2013, 02:16 AM
Beautiful post Al, thanks very much...and all the very best.