New World Camcorder

Sept. 5, 2007 — -- In retrospect, it was a pretty simple idea. Take the mysterious appeal behind "America's Funniest Home Videos," remove the insipid host and prize money, put it on the Web and let anyone contribute.

Last year's $1.6 billion acquisition of time-wasting YouTube by time-saving Google put a price tag on what any casual Internet user already knew — video had taken its place alongside longtime Web staples of text, graphics and audio.

The sharing of thousands of millions of videos might lead one to believe that the camcorder is at the height of its popularity, but it isn't so. According to NPD point-of-sale information, camcorder unit sales were down 6 percent year over year through June.

A relatively small percentage of YouTube's users upload its video and they often use the more PC-friendly digital camera or ever-present cell phone rather than a camcorder. The long zoom and recording time of camcorders are increasingly relegating them to capturing such special events as vacations, birthdays and weddings. While slim digital cameras and cell phones can easily slip into a pocket ready to capture the next small domestic animal that happens to skateboard past, most camcorders are relatively bulky affairs that must accommodate tapes and DVDs, the latter providing a convenient playback path to the television.

One area that major camcorder vendors have been pursuing in earnest has been high-definition camcorders, available with practically every media available in standard definition, including tape (HDV), optical disc and hard drive (often using a standard called AVCHD).

Hitachi has announced that it will soon offer a camcorder that can record on mini-Blu-ray discs, a high-definition counterpart to mini-DVDs that is being challenged by the backers of rival format HD-DVD. Upgrading quality is a familiar formula for success in the consumer electronics world, but not necessarily one that will enable the camcorder to compete better with the digital camera in terms of convenience.

Camcorders that use hard drives — typically 30 GB or 40 GB as in iPods — are the fastest-growing segment of the camcorder market, growing 266 percent year over year through June. Hard drives are a good fit for a world of high-definition video because files are large and can overwhelm the tapes and DVDs that have traditionally dominated the market.

However, these hard drives eventually get filled and must be off loaded somewhere. While a few manufacturers such as Sony and JVC offer stand-alone disc recorders that can burn DVDs from these or other camcorders, storing video on hard drives leads to an easier path to the PC than to the television. Furthermore, high-definition hard-drive-based camcorders are now among the most expensive consumer camcorders available, with retail prices above $1,000.

At the other end of the price spectrum are inexpensive flash-based "everyday" camcorders that can fit in a jeans pocket. Pure Digital pioneered this market with what's now called the Flip Video Camcorder, and RCA followed suit with its Small Wonder, which now includes a swing-out LCD for recording yourself and an SD slot for backing up video on the go.

Sony will bring the market more upscale with its Net-Sharing Cam due next month for $199 and aimed at those sharing video online. Unlike earlier casual camcorders, it will use a rechargeable battery instead of AA batteries, boast a larger LCD that swivels as well as twists and take 5-megapixel photos. None of these products, however, has an optical zoom capability, even though long zoom features have long been a staple of the camcorder market.

Finally, there is the middle ground. Facilitated by the availability of higher capacity SDHC memory cards, Samsung and Panasonic are introducing lightweight and streamlined soda-can-size high-definition camcorders that use flash memory and have respectable optical zoom capability. They may not fit in your back pocket, but they could represent a good option for recording something less than the major life events and more than the video snippet. Look for them at kids' soccer games near you.

Ross Rubin is director of industry analysis for consumer technology at The NPD Group. www.npd.com