What: GPS maker Garmin has announced a summer release for two new HD action cameras, the VIRB X and VIRB XE, priced at $300 and $400, respectively. Garmin developed the cameras with an emphasis on ruggedactivities such as mountain biking, targeting the extreme sports demographic that lifted GoPro to prominence. The two cameras follow the release of VIRB, the first Garmin action camera, and feature a new design, improved frame rates and resolutions,and greater connectivity with the Garmin smartwatch and heart rate monitors for expanded functionality.
There is speculation the cameras will use chips from Ambarella , which also provides the key imaging chips in GoPro devices. However, the cameras will apparentlynot feature the Ambarella A9 chip, which allows for 4K recording. The VIRB XEwill be able to capture 1440p footage at 30 frames per second and 1080p footage at 60 fps, while the less-expensiveVIRB X can record at 30 fps in 1080p and 60 fps in 720p. Both are waterproof at depths up to 50 meters.
For comparison, the $300 GoPro Hero 3+ can capture 1080p footage at 60 fps and 720p footage at 120 fps, better than the VIRB X. The $400 GoPro Hero Silver offers 1440p capture at 48 fps, again better than the similarly priced VIRB XE at the same resolution. The top GoPro model, the Hero 4 Black, is capable of capturing 4k footage at 30 fps, 2.7k at 60 fps, and 1080p at 120 fps. These GoPro cameras are waterproof at depths up to 40 meters.
So what: These upcoming cameras represent the latest challenge to GoPro's dominance in the action camera market and signal the continuing emergence of additional competitors in the space. The announcement of the new Garmin cameras corresponded with a 2% decline in GoPro shares. That said, the VIRBXand VIRB XE probably do not pose a major threat to GoPro.
An emphasis on the ruggedness of its new cameras indicates that Garmin is pursuing the high-end, enthusiast market that has driven premium GoPro products, but the feature sets on the VIRB and VIRB XE are likely not impressive enough to destabilize GoPro in this market.Theupcoming cameras offer connectivity options that are not available with GoPro. However, the Garmin heart rate monitors and smartwatch are not widely used, so the features will be of little value to those who are not already invested in the Garmin product ecosystem. Thecameras also feature a Garmin GPS and othersensors, but it is unclear to what extent the ability to track movement and other data will appeal to potential consumers.
Now what: Though Garmin is unlikely to capture major market share or significantly disrupt GoPro, a clear winner could still emerge from these products.
If speculation proves true and Ambarella chips make their way into the new VIRB models, it would be good news for the semiconductor company. The first VIRB did not featureAmbarella chips, but landing in the latest generation devices is a good indicator that the chips still offer the best price-to-performance dynamic on the market. Ambarella chips are also key components in the low-cost action camera from Xiaomi, so the semiconductor company appears to be in good shape to win space in forthcoming cameras at both the high and low end of the market.
Garmin has the opportunity to build credibility in the action camera space with its new VIRB hardware, but it will need time to become a major player unless itemploys more aggressivepricing or delivers stellar marketing. Companies such as Xiaomi, and certainly Apple and Samsung if they get in the game, pose a greater threat to GoPro, as their hardware user bases are much larger, and their top-selling devices are more natural fits for connectivity with cameras.
The upcoming Garmin cameras are the latest challengers in the space but not a major contender to GoPro. That said, Garminis just another piece of the larger threat that GoPro faces from a wide spectrum of competitors likeSony, Polaroid, Xiaomi, and HTC. With more competing products entering the space every season, GoPro is likely to experience pricing pressure and is tasked with preserving the premium value of its product ecosystem and brand.
The article GoPro Inc Faces New Competition as Garmin Ltd. Readies Its Latest Action Cameras originally appeared on Fool.com.
Keith Noonan has no position in any stocks mentioned. The Motley Fool recommends Ambarella, Apple, and GoPro. The Motley Fool owns shares of Ambarella and Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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