Re: RED one David vs Goliath?
Ted with both the new Scarlet brain and a RED ONE
Today RED announced their new plans for Epic and Scarlet. We examine the implications of this plan, the viability of the company and speak one on one with Ted Schilowitz to find out a lot of the missing information that fleshes out todays plans and answers a wealth of questions we had as to how this would all work.
The expectation was high, RED had to top not only their highly successful RED ONE, but also the promise that they had made to better it at NAB 08. It is one thing to out do the expectations based on your current hit product, it is another to top the lofty expectation you set for yourself to already top the current products- promises such as 3K for $3K and 5K EPIC performance. At one point nothing short of solving the world financial markets and reforming the Beatles looked like it could deliver on the hype. And then at 1.41am LA time after a hack attack into their image server, - RED showed their new plan to the world...
So what was it that RED showed and how does it all fit together?
Background
To answer that one has to investigate what they initially promised. At NAB there was a promise of a Soccer Mum 3K camera, fixed lens and yet with a 100M/sec internal REDRAW performance, based off a 2/3" sensor, for $3,000. This was the HVX 200 killer. A tad less than the HVX200 but in the zone when you added LCDs and other odd bits and pieces.
The second offering was the EPIC with a new high end Monstro Sensor (with more latitude), 5K resolution and a cool $35,000 price tag - trade-in not withstanding. This was the F35 killer - this was the professional camera with everything you want, slow motion (high frame rate), PL mount, serious piece of kit.
But then after IBC, RED decided that still photography should be a part of the RED equation. That perhaps a mid point between high end stills cameras and high end moving digital cinematography was a good place to be. Canon is moving towards it but with poor CMOS sensor rolling shutter times, and not even 24P mode - Canon showed that there was a gap in the market place.
Financials
So what did RED deliver?
Well before we discuss that and our RED/ Ted Schilowitz fxguide: RedCentre interview from LA, it is worth just doing some maths on the market, and just how viable a company RED is financially.
If we assume there could be say three market segments that RED could be argued to be interested in they would most likely be:
HVX200 Pro-consumer
Serious Indie Film
Serious Professional high end film.
Even with todays announcements RED are not aimed at the standard DSLR market, nor the consumer markets. The cameras are much more than standard DLSRs and more expensive than many, but they are very squarely aimed at
a much wider field as of today.
So how viable and financially interesting are these markets? Is RED in good shape financially to pull this off?
High end
Let's work our way down from the high end.
Currently there are about 75 Genesis cameras in the world, far fewer F35s or Dalsa cameras. If one was to give these cameras a generous $200,000 price tag, then at about 50 Cameras a company could expect to make
50x 200K = $10,000,000.
It was estimated in 2007 before RED delivered that the world requirements for high end cameras to service the non-indie film feature film market was just 500 cameras total. If the world could be clever: a mere 500 cameras would be need to film all the professional studio films in the world. There just aren't that many major features being shot simultaneously in any given month that the world needs more than about 500 top end cameras.
Non-studio production
Now lets look at the Indie film/TVC/ Commercials market, which is really where the RED ONE has been extensively used to date:
If we look at RED's web site they have delivered all back orders, so of the 4500 reservation holders most would have now taken delivery. Not all reservation holders would have continued on full purchase so lets be conservative and say only 3000 RED ONE cameras have actually been fully paid for and were delivered in the 12 months since last Oct when RED started shipping them. While the camera bodies are only $17,500 - the lenses, batteries, LCD, EVF, rods etc would have to make each order worth on average $30,000 roughly, if not more. So conservatively RED would have just booked 3000 x $30,000 or $90,000,000 in business. 9 or ten times what any other high end digital camera could have hoped to have sold, if not 20 -30 times as much as some. Which is perhaps why Dalsa is selling out their cameras to Arri.
Now this is not to say you can not very successfully use a RED ONE on a Studio film, but most of the say 3000 cameras in the field are not on Studio features, not by a long shot. Maybe some day, but not today.
How realistic is that estimate of 3000 in the field? We asked Ted Schilowitz tonight how many RED reservation holders did move to being full RED owners, now that the entire backlog of camera orders has been met, and he explained that "the conversion rate of people that wanted a RED at the beginning and got one is extraordinary high" and the company is shipping now hundreds of cameras per month. So the real number is fairly likely to be much higher than 3000. 'Thousands and thousands of cameras' is all Ted or RED will commit to publicly.
At over our estimated $100 million dollars in revenue, RED is extremely viable as a company long term, even with a large R&D team. So they are well placed to tackle something this ambitious. Make no bones about it, they can on paper fund it.
Prosumer
In this segment there is a lot of business. While the market is hard to get accurate data on a a whole, we can make some educated guesses. The HVX200 is about a $4000 camera that falls well in the full Prosumer market segment, it is not for home use but it is not high end either. We know from various sources that once established the HVX was selling at least 2,000 to 3,000 units a month. If you multiple that out: 12 months x 2,500 units x $4,000, then Panasonic must have booked about $120,000,000 a year gross. And it is not as if that one Panasonic camera is the only camera Panasonic makes or the extent of the market.
So if RED aims to take on a wider market, it will need to gear up for volume, something that does not appear to phase RED at all.
Scarlet was intended to move RED from higher end cameras to more Proconsumer cameras, while Epic moved the company up into a more dominant position in the high end.
RED Interview:
For a long time RED was synonymous with 4K, today they aligned the Brand to everything from 3K, 4K, 5K, 6K, 9K and even 28K. In a bold move they decided to modularize the product line into standardized components that could interchange and interlock, for example, if you don not need audio don't assemble the camera with an audio subsystem. This bold move was built on top of the previous sensor announcements, not replacing them. In fact the move today extended the resolution size to 9K and beyond. In fact the top of the line 617 camera is a 28K : which is a 260 megapixel camera, 2.5 times IMAX resolution!
The team is clearly very excited by their new plans, and what Scarlet and Epic is turning into. RED held an event at FOX studios today that ran through the press release, and showed almost an hour of RED footage from a huge variety of sources, fxguide was there, and while the event was extremely well run, it focused on the big motion picture points for an "audience that maybe wasn't obsessing on Reduser.com until 3 am" reported fxguide's Michael Scott who attended the Studio event. The event showed footage from commercials, big features, music videos and a very complex short - not yet released filmed by DOP: Russell Carpenter.
After the event that run in two sessions for the second half of the day, fxguide was granted exclusive access to talk to Ted Schilowitz, Leader of the RED Rebellion.
We spoke to Ted and asked him about the announcements and what they meant. Here are some highlights, you can hear that complete interview in our red centre podcast #21.
fxg: Starting with the 28K EPIC 617, who do you expect will use this camera? Who is it aimed at? Who do you expect to use that camera?
RED: The market will determine who will use it, there is one camera in the world now - a swiss camera that does something close to this. It is used for stills, for taking panoramic photography. If you look what RED has done from the very beginning, we have taken the 'exotic' and made it accessible to a lot of people. What used to be an exotic thing such as film 4K to data, when we started that was something almost no one would ever own or use it. People asked 'who is going to use a 4K camera it is going to be hard to use, hard to post...' and we said 'No it is going to be small, it is going to be self contained and it is going to be like using be like shooting motion picture film but without the film'. Now just a couple of years later it is now fairly common place. You have thousands of these camera, filming things all over the world in over 60 countries shooting hundreds of feature films, tv shows, commercials, you name it... what is driving that forward is that spirit of innovation, and becuase of our sensor program of which we are now talking about the third generation of mysterium chips: the original Mysterium, Mysterium-X and Monstro. We are up to a 16 bit 13 stop dynamic range - and 28K - it is like taking all the limiters off!
fxg On the 28K 617 camera wont we get almost no depth of field? Imax has less than 35mm, won't we get almost no depth of field?
RED That is a good question, most of these panaromic questions are not designed for closeups, they are designed for very wide lenses and capturing everything. What people I have spoken to are excited about in regards to the 645 and 617 - mid format and ultra wide camera 'brains" - is replacing one of the very last holdout areas where someone would use film, such as Vista Vision and IMAX cameras.
fxg But let's not beat around the bush - to be blunt - you are just not going to make much money selling that (617) camera - there just isn't that much use for 28K? The world will love you for making them but you are not going to sell many.
RED You know, I would not want to predict. If you look at what people said about the RED ONE, people said who is going to buy a 4K camera at around - with accessories - around US$30,000 to $35,000.. people said we would not sell many RED ONEs. And we sold thousands of them and it is a renaissance of owner operator- or DOPs owning and using their own gear.
fxg Switching gears, what about audio? Audio has not been discussed much in the releases.
RED There is an I/O module. The camera can be fitted out in a motion picture mode or a stills mode. You grow the camera deeper as you add to it. The I/O module has between 2 and 4 channels of audio depending on the configuration, multiple full size XLR. You add on as you need. The idea of the modular concept is that if you need audio you get the I/O module but if a shot does not require Audio you don't need to take it along.
fxg: While there was high end sensor news, we had seen a lot of the sensor plan at NAB, so today was about design?
RED: Right the DSMC system (Digial Stills and Motion Capture), what I like to say is the collision of these two worlds of stills and motion picture, but we see it as a true hybrid, you can use these cameras for say sports or nature photography.
fxg But central to the DSLR market is the concept of autofocus and auto exposure, technology we have not seen to date in RED. Are you looking to use their lens electronics or your own?
RED It is too early for us to comment on Nikon or Canon, we have no specifics to discuss on those lenses. But you have seen today our announcement of the RED Electronic lens which you can see leading on to this area. This will go to our full frame and S35 cameras, so you will be able to control things automatically in the way you do with a stills camera and also do things fully manually and this is all related to the RED mount.
fxg: Are the various mounts "field changable" mounts?
RED Field changable is a dangerous term, it is not designed to be done in an uncontrolled environment, you can do it yourself but I want to be careful not to imply that it is 'too good to be true". You can't do it while driving in the outback, - you want to do it in a very stable clean environment... but yes the overall design of these is yes these are designed to be professional user changeable mounts that can be swapped out.
fxg The amazing thing in the EPIC line is the REDCODE 225, it seemed amazing when this tripled to 100 M/sec from RC36 and now it is more than doubled again.
RED Well this is a little tricky this number is no longer a direct indicator of the data rate, it is a combination of the frame resolution and low compression with the frame rate, so the 225 number is saying both better compression and it allows high frame rate - it is not just the same 'scale' or number as before. It is not just a simple one step compression ratio as it was before.
fxg So the improvements we spoke about at NAB, that number represents some similar level of quality improvement, but at a higher frame rate?
RED Yes, exactly right - it is a combination of the higher data rates and the much higher frame rate and us riding through the waves of storage improvements, while keeping our goal of on board recording- we don't want to be having to be cabled separately to big boxes. The idea of digital film making is filming in a self contained mode.
fxgAs you move to the combination of Digital Stills and Moving images, where does the CMOS rolling shutter sit, with the Flash nature of stills photography?
Red As we advance our technology our (CMOS sensor) read out improves and we are able to do this better and better, but we dont have a specific answer to discuss now, but we have a high degree of awareness of the need to work with flash photography in stills.
fxg: Up until now, we have had a lot of choice in lenses on the RED ONE, - we could use any PL mount lens or any of the RED Lenses, but now with the Red Mount, that may change. Will the Red Mount be proprietary? Will say Cooke be able to build a Red Mount lens?
RED That is perhaps not a day one question, a lot of what we do is driven by market demands. Our user community drives a lot of this, we know if we have our own mount then we have to have lenses that cover every type of lens. We have a very good awareness that we need to provide a wide variety but then it is up to our customer and the other lens suppliers.
fxg: When will we see rough pricing on the non-'brains' module elements?
RED We have had to do a lot of work to price out all these options, but you may notice we don't even have a price on the fixed lens Scarlet option, other than the interchangeable lens is $2500, and you can sort of derive something from that.
fxg:At NAB the 3K resolution for $3K stuck with a lot of people, are we still in that zone?
REDI think we are still in that zone, it is just a little hard to predict, The lens itself is very complex, we are not cutting corners on that fixed lens Scarlet. It is going to right, it is going to be at the right price and it is going to be hyper competitive, other cameras in that zone 2/3" sensors are normally $30,000 . It is a little early, but have a little faith, we have people's best interest at heart and it won't be too far off the $2500 version.
fxg: Is the 3D "one more thing" module is that Brain specific or can it be any camera bodies. Will it just be the fixed lens Scarlets?
RED It will not just be the fixed lens Scarlet. But the smaller form factor, longer and not wider is much better, and once you give people a more mobile system then people can do much more.
fxg: Does the upgrade plans apply to any camera, or is it only to the original buyers? If someone has bought a RED ONE from someone can they get the upgrade paths or the discount that has been announced?
RED It is a little early to answer, we have not released how we will take orders or how orders will be handled. But it is safe to say if you have a RED ONE camera you will be in a better position to buy a new camera than someone who did not support us early one, someone who does not own a RED ONE, but the details are yet to be published.
fxg: Are there any surprises in the line up in terms of ISO, day light balanced etc?
RED Nothing we can announce yet, as we are still testing. We have sample sensors we are testing in the lab and once we have information we will put that out, our intention is to improve every parameter, but the biggest thing is to improve the dynamic range.
fxg: As you move towards the Stills market you invite the comparison to the great ISO, low noise that the stills community are enjoying on the newest models. Not something that is as demanding in the motion picture world.
RED I think you'd be surprised at how much interest there is in filming motion footage at higher ISO. In low light, we have had people doing amazing stuff. For those who want to shoot low light we say get the fastest lenses on the planet- Master Primes or Super Speeds and know that you have a lot of room to move with proper grading tools and you can get great amazing results.
fxg: You also have a similar desire from the stills community the expectation of working with Lightroom and Aperture like a stills camera does, you have a very good relationship with Adobe and Apple can we assume that will extend into whatever format your stills will be in?
RED That is a smart assumption. Our whole program is all about redcode. Redcode is the core of our company, the sensor technology and the Redcode technology is at the heart of this company. We have had a great relationship with Apple from day zero... Redcode is redcode and we will see some things soon. They have already supported Redcode and so you can make some assumptions there, and again with Adobe you can assume things are pretty excited about Redcode.
fxg: Has the 180 Burst mode on the Scarlet gone away? We heard it had not?
RED In the fixed lens Scarlet it has not. But as we move to the other cameras we are setting our gold standards and then we need to explore what we can do.
fxg: Is the boot time of these cameras now dramatically improved?
RED Yes absolutely. Red One has a boot time of about a minute, for the Epic and Scarlet is it a few seconds. It is meant to feel instantaneous.
fxg: Go back a year, RED was a 4K company, but the company is not longer just a 4K company. Have the 4K projector and 4k monitor plans you discussed with us at NAB 18 months ago - off the table?
RED They are not off the table: High resolution is where we are at, we are not locked into any one format, but they are still on the table, the Red Ray is still in development, just because we are not cheerleading at the current time, does not mean they are off the table.
fxg: Jim comes from a consumer wide market background. Is the 'Soccer Mum' someone you still want top talk to?
RED Yes what I meant by that is that there are a lot of parents that are using high end SLRs and shooting RAW, and they already understand a lot of what we do, if they know it or not, and so yes we want to find out what is important to this market. ...If you look at the sidelines of any kids activity, wedding, tradeshow etc - they are not just shooting with pocket cameras they are shooting with real cameras and now they they can have a real tool on the moving image side as well.
fxg: There are some examples of combinations of Camera brains/sensors/fps - that are not covered. for example there is no PL mount Scarlet with high frame rate, and high dynamic range... do you think these will be reviewed and possibly adjusted?
RED We do that daily. We are always fine tuning our specifications. This is todays logic, give us some time to process this and get feedback. We are constantly looking to see back what people want. But lets table that discussion for more than day two, but I don't think people will be disappointed, we will be as flexible as we have always been in the past, since day one.
fxg
