The Future of GoPro
In 2013, GoPro became the leading “pocket camera” on the market. With a slogan like “Be a Hero,” anyone can appear to be an action hero. Originally designed to capture pictures while surfing, this camera has become almost essential to all adventurists, whether surfing, flying or falling (even from space).
[video by GoPro: Jump begins at 3:45]
Nick Woodman created the first ever GoPro by strapping his 35mm camera to his wrist using surfboard leashes and rubber bands.
He began marketing the camera to other surfers on tours and in September 2004, the GoPro 35mm HERO debuted selling $150,000 in product. Between 2004 and 2007, GoPro began marketing towards land sports like skiing and biking, added video capability and brought in over $3.4 million. Since, there have been over 15 million GoPro cameras sold to date and GoPro has created new versions of their cameras with wifi and app capability.
But in the past two years, the only “new” development has been the HERO4 Session, the smallest and lightest camera yet. However, as of December 2015, GoPro revenue is down by 31% and over 74% of GPro stock has been lost in six months. What does this mean for the GoPro corporation? GoPro needs to prove that it can evolve.
The Problem(s)
The idea behind GoPro is simple enough: Capture and share adventures. However, one of the largest problems that the company has been working to solve is “sharing” adventures.
“While GoPro has sold cameras to customers on the grand vision that they can look like pro athletes or “heroes,” the reality is that users often find it arduous to upload and sift through hours of skiing or scuba diving footage to put together a beautiful video,” Ryan Mac reported for Forbes in February 2016.
Although GoPro now has a mobile app to control your camera remotely, it does not solve the editing issue. In an attempt to fix this problem, GoPro paid $105 million in cash and stock to buy the two companies behind Replay and Splice, video editing applications that allow users to cut and publish footage on their mobile phones. Woodman has declared that the Splice and Replay experiences will be incorporated into the GoPro experience so much so that it will be impossible to miss that it is one experience instead of independent forms.
Another major problem for GoPro is its innovation and evolution. Lately, the company has been compared to Flip camcorders based on its lack of growth and development. Flip sold over two million units between 2007 and 2009 before it was bought by Cisco for $590 million. In 2010, Apple released the iPhone 4 with the video capable of recording 720p HD video and Flip quickly became obsolete and died out in 2011. The problem for Flip was the company’s inability to evolve.
In the year-ago quarter, GoPro racked up sales of $634 million. This year, it said it expected sales to be around $435 million. The HERO4 Session’s initial price dropped from $399 to $199 within months. If sales are declining, one can assume that the overall market is shrinking. Everyone who needs a GoPro already has one, or the market is moving to other product categories, like phones.
Although GoPro is beneficial for adventurists because they are more durable, waterproof and mountable (handsfree), smartphones are accelerating in picture and video quality and many people solely use phones to capture and share adventures. Most smartphones offer
- More memory
- Built in image stabilization
- Better battery life
- Accessories (like wide angle lenses, remotes, etc..)
- Display screens (GoPro has none)
- Ability to watch your videos right after recording
- Upload and share instantly
Even with mobile app for GoPro, if the consumer is using his or her phone to control or save photos, why use a GoPro? With the evolution of smartphones heading towards waterproofing and wearable mounts, GoPro should be worried about the competition in the next few years.
The extreme sports and action market is finite, meaning the number of people who don’t base jump, ski through avalanches or free climb is much bigger than that of those who do. Although Woodman has stated, “We would prefer to think of it more as… the world’s leading activity capture company,” the company needs to evolve into the non-extreme sports market.
The Next Step
The GoPro drone Karma is set to be released in 2016, but there are a number of other companies offering drones with similar capture products, like the DJI Phantom 3 Professional which is regarded as the best drone camera on the market right now. With new FAA regulations requiring operators to register their drones with the federal government, drones may remain a niche product in the future.
With GoPro behind on drone development and camera quality on phones improving, GoPro is still looking at a gloomy future. The next step should be virtual reality.
In 2012, Nonny de la Peña premiered Hunger in Los Angeles at the Sundance Film Festival, but what separated her from other filmmakers and journalists was virtual reality. A former intern, Palmer Luckey took an idea that had been around, arguably, since before 1920 and perfected it enough to really establish a new beginning for VR. After the success of Hunger, he built a consumer version of his VR headset, calling it Oculus Rift. Facebook then bought his company three years later for $2 billion and have now released the headset for consumer use.
With VR becoming more popular and attainable, the action packed world of GoPro can also become interactive. A 360 degree camera has been rumored since talk of the GoPro drone began. Google debuted a $20 cardboard “headset” or viewer to fit a phone which was highly accessible and user friendly, but what about filming? GoPro partnered with Google in May 2015 and announced Odyssey. In September 2015, they debuted the 16 camera wheel that will capture VR content.
The Odyssey camera kit includes the hardware to interface all 16 cameras together, custom firmware loaded onto the cameras and a way to charge them simultaneously. GoPro claims this camera set allows the unit to act like a single camera with every pixel synced accurately. However, access is limited since GoPro and Google are accepting applications and will only give select content partners access to buy one.
The cost of this unit is also limiting to a significant portion of the market. A Silicon Valley analyst Tim Bajarin advised Woodman to get an easy to use, affordable (under $1000) consumer grade 360 degree GoPro camera on the market as soon as possible. However, 16 GoPro cameras alone will set you back at least $3000. So how much is the Google + GoPro VR camera? $15,000.
The release of a 360 degree camera could reach a new and larger consumer market than that of just thrill seekers. Google’s technology partnered with the GoPro brand is worth a hefty price tag for the brand name. But $15,000 is almost unreachable. It’s a great idea and developed well, but there are more affordable 360 degree cameras already available on the market. For example, the Ricoh Theta S is only $349.95 with the ability to shoot in 1080p HD at 30 fps for up to 25 minutes at a time.
Nick Woodman and the GoPro company have completed the first step in admitting the problem, but they continue to throw money at temporary solutions and hope these problems disappear. He is blindly optimistic stating, “I know today isn’t the type of day we’re used to at GoPro, but from the looks of things… tomorrow is looking pretty damn good.” They are behind in development and marketing with similar products available to consumers. GoPro is the best pocket camera especially for adventurists and thrill seekers, but they are quickly falling behind and eventually will not be able to catch up.
