March 3, 2008 -- Digital cameras are still among the most popular electronic gift items during the December holidays, not to mention those honoring moms, dads and valentines. But now that everyone and her grandfather can digitally capture everyone and his granddaughter, the rate of growth has started to slow.
In 2007, unit sales of digital cameras grew 11 percent, down from 22 percent the previous year, according to the NPD Group's Consumer Tracking Service.
So what can one get for the photography addict who already has an up-to-date digital camera?
Even as the digital camera reached a new milestone recently when Polaroid announced it would end production of instant film, getting photos from a memory card to print (sometimes with a pit stop at the PC) remains challenging for many consumers. Enter the digital photo frame, a gadget that was pioneered by Sony back in 1999. Its CyberFrame featured a 5.5-inch screen and cost $900. Now most of them feature 7- or 8-inch screens and cost less than a tenth of that price.
The appeal of the digital picture frame is its core simplicity. The devices typically consist of little more than a screen, a few memory card slots or a USB port, and an inexpensive processor that sits between them. Consumers can simply remove their memory cards from their digital cameras, pop them into the frame and enjoy their digital pictures.
Unquestionably, the gratification is instant, but is it lasting? According to NPD's Weekly Tracking Service, digital picture frame sales increased nearly five times this past holiday season over the 2006 holiday season. The products have been popular items in department stores as well as home specialty stores such as Bed, Bath and Beyond and Linens & Things, where they appear in the photo frame section. But the jury is still out on whether consumers will use them for displaying a permanent photo collection the way picture frames have been used historically.
Manufacturers of these devices, meanwhile, are not waiting around to raise the bar. Already many frames can display video or play back digital music files. Some can turn themselves off automatically when no one is around. Others available now or coming soon include "Framekensteins," which have been combined with an iPod dock, a cordless phone and even a printer.
Sony, which is re-entering the market after a long hiatus, has an HDMI port on its digital photo frames for expanding the view up to a high-definition television. Other frames include Bluetooth technology for receiving pictures from cell phones or Wi-Fi to display them from a home network or a broadband connection. It's likely someone will add a digital camera for sending quick snapshots or perhaps enable videoconferencing.
Ceiva, an early entrant, charges a monthly fee that enables more sophisticated users to send photos to its frames even over a dial-up connection, but other companies are offering frames with their own e-mail addresses that will receive photos for free. The proliferation of these small screens has convinced one startup to launch a media network delivering Web-like information specifically to them.
The digital picture frame may become an inexpensive way to distribute photos throughout a home or across the Internet to friends and relatives. It may continue to be used as a quick and simple way to look at a fresh batch of pictures. Or it may fade from the scene as it becomes easier for large-screen televisions to tap into memory cards, digital cameras and PCs. Regardless, these small screens have opened some big opportunities for doing more with digital photographs.
Ross Rubin is director of industry analysis for consumer technology at the NPD Group.