Digital Camera Maintenance Nightmares

By Staff Reporter QIU JIANG HONG

A prospective buyer tries a close up shot to test photo quality.

As you've finally decided to buy a digital camera, words of advice worth considering are: think twice. After encountering friends' problems, you may come to the conclusion that you can afford the cash to buy, but not to maintain your piece of technology.

Mass Demand for Maintenance

Digital cameras are convenient and fun. Unlike its conventional cousin the film camera, the digital camera lets users capture and store a moment anytime they want. They can delete it if dissatisfied, and edit, print or email the image through a computer, saving time and money. Since its birth in 1991, the digital camera has been a great success. Now the photographer's delight, has made its way into ordinary households.

In the late 1990s, when digital cameras first came to China, they were too expensive for most consumers. This and the trade barrier restricted the annual volume of cameras to only tens of thousands. But the number kept increasing as consumer knowledge of digital products grew. In 2000, 150,000 cameras were sold in China's mainland. After WTO entrance in 2002, China nullified the 14,000,000-dollar quota on imported cameras in 2003, and the number of camera purchases hit 1,000,000.

As more people discovered the convenience of digital cameras, families with sufficient disposable income fit one into their budget. According to research conducted in early 2004, digital cameras rank number one on urban families' purchasing lists. In the first quarter of 2004, 300,000 cameras were sold, a number expected to double in the second quarter. Some analysts predict 2004's sales volume will reach 2,000,000, twice the number in 2003. These statistics bring a warm rosy glow to camera manufacturers and dealers.

As user numbers grow, so does maintenance demand. Sampling research by China's quality and technology supervision department shows that only 60 percent of digital cameras on the market meet quality standards and that the failure rate within one-year usage is 30 percent. In view of the large numbers of digital cameras in China, the potential maintenance market is clearly enormous.

No Maintenance Experience

Furious competition doesn't block sales.

Demand doesn't necessarily spur action, and maintenance services are way behind growing sales. Canon has 17.5 percent of the digital camera market in China, but has only appointed three maintenance stations in Beijing, all within a limited area, even though the city is home to hundreds of thousands of Canon-users. Smaller brands like Panasonic, whose market share is below three percent, has only one appointed maintenance station that provides service on all kinds of digital products.

Such an unbalanced supply-demand relationship turns maintenance dealers into a monopoly and creates passive consumers. The following cases give some idea of the problem.

Case 1. Where can I have maintenance work done? How long will it take?

As maintenance stations are not evenly located and short staffed, consumer maintenance demands are often put into abeyance.

Yu is a shutterbug from Shanxi Province. At the end of 2002, he bought a famous brand camera, which cost him more than RMB 9000. Less than six months later, the camera's liquid crystal display blacked out while he was shooting. After the battery was replaced, the display remained black. As Yu found no maintenance station in his city, he called the brand's hotline the next day and was told to bring the camera to a Beijing maintenance center. In order to use the camera during the week-long May holiday, he asked for two days off work and took a nine-hour, 500 kilometer train ride into Beijing. The maintenance center was busy and customers had been waiting for up to ten days. Though they did their best to help the traveler, Yu waited for five days. When the repairs were finally done, the holiday was almost over.

Case 2. Who decides the liability of the contracted maintenance? The maintenance level?

Under most digital camera warranties, factitious damages are excluded. Only maintenance stations have the right to delimitate whether or not damage is factitious.

Compared with Li, Yu seems to have been lucky. Early in May 2003, Li bought a RMB 8,100 digital camera. By May 20, the camera's adjustable lens could not be retracted. Li sent the camera to its maintenance station in Chengdu and the station surmised that the gear in the lens had been damaged and that the whole lens needed to be replaced. After analyzing the concave trail on the lens' ornament ring and the coating abrasion on the lower part of the camera body, the damage was defined as factitious and Li was held responsible. Although Li disagreed with the conclusion, he could not produce evidence that the damage was not factitious and had to pay for a new lens.

Case 3. How are maintenance fees calculated? Do consumers have the right to cancel maintenance?

Monopolized by a few appointed maintenance stations, the maintenance market lacks competition. Prices of parts and service fees are not transparent and customers have no say.

Wang is an amateur photographer. Two years ago, he bought a low-end digital camera costing RMB 3300. The camera shutter came loose after the warranty expired, so he decided to pay for repairs. After examining the camera, the maintenance center offered to repair it for RMB 1200. But by then, the market price of that camera had dropped to below RMB 2,000. Wang decided it was cheaper to buy a new camera than repair the damage. When he told the station to cancel maintenance, he was informed that he still needed to pay 30 percent of the RMB 1,200 as a "checking fee" because according to them, "checking is as troublesome as repairing." Wang had no choice but to pay.

Speedy product updating makes buyers dizzy.

Damages Not to Be Ignored

How do these problems occur?

Although maintenance is a huge market, demand needs time to emerge. Business opportunities for maintenance lag far behind those of sales.

As the demand for digital cameras grows, suppliers can make healthy profits through sales alone. Concentrating on sales also improves delivery efficiency, and in the short term, the service lag does not affect sales. Focusing on sales rather than after-sales service seems the more profitable mode of operation.

Another reason for this lag is scarcity of capable technicians. Most digital cameras currently sold in China are produced abroad. Technicians are also concentrated in where digital cameras are produced. If suppliers take on maintenance in China, their costs will be higher. Consequently most suppliers entrust maintenance work to local cooperators. But as competent technicians are currently very few, development of after-sale service is slow.

Although these problems can be solved in the long term, in the interim it is becoming clear that lack of services damps down market potential and influences consumer buying choices.

There are two short-term customer tendencies. First, potential customers may choose to buy cheaper film cameras that are easier to repair. Second, they may buy illegally imported digital cameras, which with no after-sales service are relatively cheap.

As home manufactured digital cameras develop, their local advantages may sway customers into buying them by virtue of their providing better after-sales service. This could have great impact on foreign brands that currently enjoy the main market share.

Camera giants such as Canon and Nikon are rumored to be looking into ways of solving these problems. They include upgrading after-sales service teams through better training, breaking monopolies and expanding service networks by merging after-sales service providers.