Earnings call season is among us, and that means plenty of interesting tidbits to be had. By far, the most interesting earning call to date in the sports tech segment was GoPro’s Q4 2021 earnings call yesterday, where GoPro announced they plan to more than double their camera lineup in 2022, and then expand it further in 2023.
And by ‘lineup’, we’re not talking just a new budget GoPro, but rather at least one very distinct new camera targeting professionals, and then another distinct camera targeting some other group.
Now in the video above I dive into all the notable quotes, which is easily more than half of this entire earnings call with them outlining the use cases and scenarios for these new cameras. However, the key bit starts off towards the beginning, when CEO Nick Woodman says:
“At the end of 2022, we plan to increase our hardware offering from the two product types we have today, HERO and MAX, to four distinct camera products. And we expect to expand that further by the end of 2023. This is in addition to the aggressive road map we have planned for software, including new cloud capabilities and an all-new subscription-based desktop application.”
This fairly loaded three-sentence chunk basically outlines what he’ll detail over the course of the remainder of the earnings call, especially (or really entirely) via the Q&A section. And ultimately, it’s best divided up into three pieces:
A) The plan to go from two cameras to four cameras
B) Expansion of cloud capabilities, notably around in-cloud editing
C) The re-introduction of a desktop app, but with some subscription component
Now for the first one, GoPro then spends significant time explaining that they aren’t talking about just having secondary GoPro Hero models like in the past (e.g. a GoPro Hero 10 Black, Hero 10 Silver, etc…), nor are they talking about retaining previous year models like they do today at retail (Hero 10, Hero 9, Hero 8 all available as options). Instead, he makes it very clear that they see those cameras as basically targeting the same use cases, just at different price points with minor differences:
“And so without going into detail about the products themselves, if you look at our good, better, best strategy that we used to have, that was three different price points of the same camera. And the camera got higher resolution, higher frame rates, maybe some additional features as you went to the higher price point product.
But by and large, they were very similar, and they were built for the same use cases. So you were attracting the same customer, but just they might have been an entry-level, mid-level or high-end customer but at the same customer type. Going forward, we think it’s important to build very differentiated specialized solutions for different use cases to appeal to entirely new groups of users that have new needs that a HERO camera maybe solved, but maybe it’s got some other aspects to it that are undesirable for that use case, and the user doesn’t need all these other things that the HERO camera does. And so it ends up being more than they need or not enough of what they need.”
From there, he outlines how essentially the same camera a YouTube vlogger uses, is one a scuba diver uses, and then one a film production uses. It’s literally the same thing. Yet, the needs are in many ways quite different. And that’s all true – especially the fact that these cameras are used routinely on major products and sets. Sure, they aren’t the a-roll for the entire movie, but they fill in the gaps in scenarios that are otherwise impossible to film with a larger camera.
“And I make it a point to mention consumer and professional because I think it sometimes gets missed that GoPro’s are used by professionals the world over, whether it’s for film, television, their own commercial purposes, their own research purposes. We just won our second Emmy.”
And this is where he goes on to make it clear that a pro-level camera is coming:
“You guys deserve that recognition and got it. But it’s not a good, better, best strategy. It’s use case A, B, C, D, E, F, G, all very different from one another. And rather than make one Swiss Army knife that does it all for some people, some people want specialized knives.
And that’s what we’re going to build for them.”
And this type of tiny camera at a higher level isn’t new. The Sony RX0 series, for example, has been around a number of years, but never entirely caught on. The 2nd gen was better, but ultimately, the series suffered from marketing confusion. It desperately wanted to be an action cam for marketing purposes, but simply wasn’t a good action cam. Internally though, it was far better suited to production scenarios that required a tight fit. For example, mounting in the front of a car (I believe I’ve seen them on Car Karaoke with James Corden), and getting very high quality, even allowing uncompressed 4:2:2 output to external recording devices. Same goes for direct mic inputs, and higher bitrate options. That’s been priced at $700, though, it’s three years old now.
Which, gets to payments. It’s clear that a pro-level camera from GoPro won’t be cheap. During the call, Nick Woodman goes on a bit of a discussion about the higher margin opportunities by using a single baseline foundation for their cameras, and that these are all derivatives. In fact, he even pauses to specify his use of that word and why he’s using it. But again, a higher-end camera will cost more:
“And we need to do things that they have been asking for, for years that we just can’t get done with a HERO camera due to certain physics constraints. But if we make an entirely new camera based on HERO camera technology but we break the mold in terms of like what the cameras form and purpose is, we can deliver for these people. And they’ve indicated that they’re willing to pay even more for these types of specialized solutions.”
Of course, enough about pro stuff. As noted, GoPro says four “distinct” different camera types. My guess is they’d be divided up as follows:
A) Pro Level Camera
B) GoPro Session Redux
C) GoPro Mainstream camera (e.g. a Hero 11)
D) GoPro Max 360° camera (e.g. GoPro Max 2)
This would be a pretty obvious reading of the situation. There’s clearly a market for smaller cameras, like the Insta360 Go 2 and the DJI Action. The challenge has been that both companies have somewhat fumbled their implementations, seemingly making mistakes that were own-goals.
Insta360 is the closest with perfection, but just made some odd decision choices that make the camera clunky for wider adoption (I outline those in-depth in my previous review). While DJI got closer in theory with their Action 2, but also fell short in execution. For example, not having waterproof microSD card slots and USB ports, meaning they are heavily limited in what you can actually do with the camera due to very short real-world battery and storage run-times – and extremely bad overheating times (4-6 minutes in certain cases…).
Undoubtedly, GoPro is looking at these scenarios and saying “We can do that better, since we only need to not screw up two things: Storage and battery”. And it’s true. I think if GoPro took the bulk of their Hero 10 software and dumped it into a DJI Action 2 camera with a Hero Session battery/SD card door, people would be thrilled and happy. Sure, GoPro will still have to contend with heat issues, but I think they’ve learned a lot from their fiasco this past fall.
This type of Session camera would heavily appeal to the FPV community, which has been literally tearing apart GoPro Hero 10 cameras, because they want the quality/stabilization without the size. Despite Insta360 making a dedicated version for FPV, it just hasn’t seen the adoption of GoPro cameras, likely because of the GoPro quality.
Meanwhile, on the cloud front, he talks a bit about what’s coming there, saying:
“The good news is we have that technology in the app already with our automated edits. And this year, we’re going to be porting that in all of the manual edit tools to the cloud and providing for a much more automated experience where you plug your GoPro into charge, it uploads all your footage to the cloud. We push you a highlight edit of all of your photos and videos that you just captured before you finish your beer. So that type of convenience is coming later this year.”
Though, that section is prefaced with some caveating around also appealing to higher-end users, saying:
“They want to see more automation and convenience. The experience is really well tailored for what we would call users that are higher on the passion curve and are more interested in doing some of the work. They’re the more creative types, this is a hobby or a profession for them, but are more mass-market, mainstream casual users. As you can imagine, they just want it to automatically work for them.”
However, the wording on the earning call transcript is a little weird above. The actual earnings call audio hasn’t been posted yet, so I can’t hear precisely where the pauses are there or maybe a missed word, as the above sorta confuses those two concepts. But, based on the vast majority of the call discussing the pro use cases, and the middle portion here discussing the prosumer use cases, I’m pretty sure the intent is clear.
Now, this is where I’d make the case that GoPro really needs to think about these scenarios – and not so much just doing the minimum bar, but surpassing it. A production company that has a dozen GoPro’s wants easy ways to get footage off of cameras. They’d love to either plug them in to USB-C power to get footage uploaded to a central repository via WiFi (like a NAS server), or, even better would be the ability to use a USB-C ethernet adapter of sorts that could do the same over high speeds. How cool would a simple accessory be that both provided power to the camera, and offloaded that 256GB+ of content super quickly from a dozen cameras?
Lastly, GoPro made brief mention of that desktop app earlier:
“…and an all-new subscription-based desktop application.”
As you may remember, GoPro had their Quik desktop software, though in recent years it’s basically been abandoned. However, GoPro surged development of their mobile app, and expanded their focus beyond GoPro users. In fact, they added a boatload of non-GoPro users. Check out this line from the call:
“Our Quik app subscription, which we launched in spring of 2021 for mobile users who do not own a GoPro camera, grew to approximately 221,000 subscribers by year-end.”
And those are just the non-GoPro camera peoples. Here’s the totals:
“Our direct-to-consumer efforts contributed to the addition of 815,000 new GoPro subscribers in 2021, bringing our GoPro subscriber total to approximately 1.6 million at year-end, representing very strong growth of 107% year over year.”
Anyways, as for what we’ll get on desktop – that remains to be seen. GoPro says it’ll require a subscription though, so I assume it’ll be focused on editing automation, akin to what Quik does on mobile. Given how well things have gone for them on mobile for non-GoPro users, this would be an obvious area to expand reach.
Which, seems to be the general sentiment of the earnings call – expanding reach and into newer markets. If you’re into this sort of thing, you can read the whole transcript here. It’s fascinating how much detail is in this one, compared to most earnings calls. I can’t remember the last time we’ve seen any sports tech company get this deep into their otherwise unannounced plans before. I suppose Peloton’s much-anticipated earnings call next week might rival it though, if for no other reason than them being heavily on the defensive and likely having to demonstrate they have a clear financial plan going forward.
With that – thanks for reading!