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What are the features that make a DSLR costlier?

For example, I am wondering why the Nikon D700 costs $2000?

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The Nikon D700 has a full-frame (FX) sensor. Such sensors are inherently more expensive than APS-C (DX) sensors, due in part to the relatively lower yield from chip manufacturing.

In addition, the D700 is a "pro-grade" body, featuring alloy chassis, multiple controls, and AI-lens metering capability. Compared to a D300s for example, which has similar features, the premium is basically all in the sensor.

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There's a significant extra cost to manufacture the sensor as gerikson states (with 2.25 times the area the chances of a defect is much higher so they have to throw more chips away per wafer due to defects).

But there's another factor to consider and that is that D700s cost more because people are willing to pay more! It's the same everywhere you look, the premium models cost a disproportionate amount. The extra money is used to subsidize the entry level models whose sales figures are far more price sensitive.

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    \$\begingroup\$ This is almost always an economic fallacy - if the price of the object were set artificially very high, then competition could swoop in at a lower price and get the business. Sensor manufacturing cost, justifying the cost of pro support, better materials, higher R&D are much more likely candidates. For some reason, the public likes to think that businesses are "sticking it to em" by artificial price inflation. It happens, but its much rarer than most think. \$\endgroup\$
    – rfusca
    Commented Apr 13, 2011 at 14:35
  • \$\begingroup\$ @rfusca - The current DSLR market isn't a good candidate for applying the principles of free market perfect competition, especially in the short run. There are a limited number of players; all the products and brands are clearly distinct from one another; and the market as a whole moves very slowly, maybe even on the order of years, between new camera development time and slush price changes. \$\endgroup\$
    – Sean
    Commented Apr 13, 2011 at 15:09
  • \$\begingroup\$ @Sean - that might be true if this were considered a short run situation, but pro cameras have been at a premium for years. Plenty of time for additional competition to step in and really it works so longer as there isn't a single player. The cost of switching would appear to be a barrier, however the cost of switching brands may be high, but plenty of people still do it with the resale value of lenses also being relatively high. I'm not suggesting its a perfect market, but its enough to apply some traditional econ to. \$\endgroup\$
    – rfusca
    Commented Apr 13, 2011 at 15:19
  • \$\begingroup\$ @rfusca The release price of the Canon 1Ds mkIII was about £2000 more than that of the 1D mkIII. Both cameras have almost identical bodies, materials, AF, support, R&D costs. The big difference is the sensor size. That can't account for the price difference as the 1Ds mkIII sensor is pretty much the same as in the much cheaper 5D mkII! \$\endgroup\$
    – Matt Grum
    Commented Apr 13, 2011 at 16:32
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    \$\begingroup\$ Actually I learned about this teaching business calculus. By gradually lowering the price of a technology as new versions are introduced you can effectively get every consumer to pay the maximum price they would individually be willing to pay for the item. The computer that is selling for $300 today but sold for $600 yesterday really only cost $200 to make, but by letting the price drop gradually everyone ends up buying it at their own individual top dollar price. I don't like the practice, but its very common. \$\endgroup\$
    – John Robertson
    Commented Apr 13, 2011 at 18:17
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Another reason is that professional level photographers expect, indeed need, higher levels of support. This means better spares availability, faster turn around on repairs, stocking of replacement kit and more support staff. All of this adds to the price of the camera.

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Because professionals and ambitious amateurs (especially ambitious amateurs!) will pay for it. That is the sole reason why. You don't need an expensive camera to take good pictures; in fact, there is almost certainly no photography application for which you couldn't use a cheaper camera.

By contrast, there are many applications that would be better (or more conveniently) served by large or medium format cameras, which are even more expensive.

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Don't forget that the development costs are divided over the number of units sold, so for specialist cameras that are beyond the needs of most camera users, the total number of units sold is lower, and the cost of R&D per unit is higher.

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  • \$\begingroup\$ I seriously doubt that expensive DSLRs embody more advanced technology. If anything, for Nikon and Canon, who refuse to provide in-body stabilisation on the interchangeable-lense cameras, quite the reverse. \$\endgroup\$
    – Marcin
    Commented Apr 14, 2011 at 9:29
  • \$\begingroup\$ @Marcin, I worded my answer carefully to avoid suggesting that there is more R&D involved in the specialist cameras. Instead, I am arguing R&D costs per unit sold are higher. \$\endgroup\$
    – Oddthinking
    Commented Apr 15, 2011 at 8:41
  • \$\begingroup\$ Unless the technology is exclusively used in the higher end cameras, there is no accounting justification for allocating a greater proportion of the price of the camera to R&D costs. Accordingly, amortisation of R&D costs cannot drive the higher price of the more expensive camera units. \$\endgroup\$
    – Marcin
    Commented Apr 15, 2011 at 11:58
  • \$\begingroup\$ @Marcin, oh I see where we were at odds now. I was talking about technology exclusively used in higher-end cameras. Larger sensors, case-design, customising software, flash interfaces, factory fitout, support processes, etc. For the technology in common, I agree with you. (Note: Still not suggesting that there isn't even MORE R&D involved in getting other features into the smaller footprint of compacts.) \$\endgroup\$
    – Oddthinking
    Commented Apr 16, 2011 at 1:42
  • \$\begingroup\$ I don't buy that any of those things are more expensive for the higher-end cameras, given that almost all of it is off-the-shelf stuff. The exception is the larger sensors, which are probably more expensive to manufacture, due to manufacturing variation. \$\endgroup\$
    – Marcin
    Commented Apr 16, 2011 at 10:17

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