First Click: Is GoPro the next Flip Video camera?

May 6th, 2016


Do you remember Pure Digital Technologies’ Flip Video camera? The singularly-focused maker of small dedicated video cameras was an industry darling back in March 2009 when Cisco acquired it for $590 million. Cisco shut it down just two years later. Its reasons were two-fold: 1) the company was restructuring around its core networking business, and 2) HD-capable smartphones like the iPhone 4 were eating its lunch.

Some are now suggesting that GoPro, the singularly-focused maker of small dedicated video cameras, is on pace to suffer the same fate. I’m not so sure. The argument being made is that the smartphone will prevent GoPro from going mainstream. A Wall Street argument that centers around the only thing analysts care about: growth. That’s very different from a continued ability to serve an existing market, niche as it may be, but with room to grow.

The smartphone was clearly a direct threat to Flip cameras. They were gadgets of the same size that allowed parents to "videotape" their kids from the same angles at roughly the same quality. But action cameras are different. They’re more often than not smartphone accessories. GoPro can make the Session a 1.5-inch cube precisely because it’s unencumbered by the need for an attached LCD. And the trend is for action cameras to get smaller while smartphones are only getting bigger.

I’m perfectly happy to strap a GoPro to my snowboarding helmet but there’s no way in hell I’d strap my iPhone 6 Plus to it. For one thing, iPhones aren’t waterproof. For another, that giant display is going to get cracked during one of my inevitable spills. But more importantly, I can’t risk losing my phone. It’s bad enough to lose a day’s photos and videos when a $199 GoPro disappears into a few feet of powder, but it’s even worse when it’s the $700 personal gateway into my life, that of my family, my business, and even my smart home. I’m perfectly willing to strap a GoPro to my bike, surfboard, longboard, bumper, and other places I’d never risk placing a smartphone. And for what it’s worth, I’ve yet to see a smartphone strapped to a helmet in real life.

If anything, the reasons for the decline in GoPro sales is due to software and saturation. Everyone is making action cameras now. Kodak, Nikon, TomTom, Samsung, Sony, Garmin, Contour, Toshiba, and Panasonic just to name a few. Xiaomi’s recent entry signals the end of fat profit margins on commodity hardware. Others are miles ahead of GoPro when it comes to shooting and editing your captured videos. GoPro’s newly acquired apps take steps to correct that, but in my experience, the GoPro experience is still far behind companies like TomTom. And just like the iPad, there’s been very little reason to upgrade a GoPro purchased in the last few years.

But mainstream video needs are changing. Live broadcasting is taking off thanks to the advent of Twitter-owned Periscope and Facebook Live. Using a GoPro as a dedicated camera and the phone as a wireless remote control / teleprompter / interactive chatting device is one possible path into a broader consumer market. The company’s already taking steps in that direction with a Periscope deal announced in January. It also recently launched a developer program for companies like Fisher-Price and BMW to integrate GoPro cameras directly into their products. And then there’s the GoPro Karma drone and the company’s 360-degree Omni camera rig both set to ship later this year.

I’m not saying that GoPro hasn’t seen better days. But it's no Flip.

Or am I wrong?

Is GoPro the next Flip camera?
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