Hi Frank
The phone manufacturers have long since exceeded the point of images being "good enough" for most users. I, for one, am constantly amazed when the modest camera in my iPhone gets a shot in circumstances where I would hesitate with a "proper" camera. As you say, performance will only improve, although with some high end phones now costing in the region of £1,000 I would expect decent imaging. (Incidentally, that £1k figure is more than the net price I have just spent on my most recent camera purchase.) I am not sure that the camera manufacturers are trying to compete with camera phones. Their solution to falling sales seems to be in attempting to sell high priced full frame models. Volumes will be lower but profit per unit is supposed to be higher.
Where mobile phones also score is the close integration with social media. Take a shot and it can be on the Internet within seconds. Few camera manufacturers are attempting to match that, although my new camera does have Bluetooth to link up with a mobile phone. Despite Bluetooth being around for years, that is still something of a rarity. I have not yet tried it, but some reviewers have said that they struggled to make it work. There was a recent firmware update which fixed it, maybe.
The problem for the manufacturers is that digital cameras have long reached the point of sufficiency, which is probably the main reason for sales continuing to decline. It may well be that a lot of people are using their gear until it breaks. I recently took shots of this year's London to Brighton Veteran Car run using my original Canon 7D purchased in 2010. I doubt whether my results would have been much different using a more modern camera. You can see for yourself on my blog:
https://lightintotheshadows.proimageblo ... -run-2018/The latest attempt by Canon and Nikon to make us buy new equipment is their long overdue migration to mirrorless. While it is still early days, that will take time to gain any traction. Unless there is a feature which you really need, why buy a Nikon Z6 when a D750 will perform better, is part of a mature system and cheaper? When I bought my camera, the salesman told me that few people were purchasing the new Canon or Nikon models but they were selling plenty of Fuji X-T3s.
Also, what is Canikon's strategy for mirrorless APS-C? That is where the volume lies and greater profitability overall. I am not sure that the EOS-M mount cuts it, especially as there is no upgrade path to EOS-R. Nikon’s approach is currently unknown. Maybe we will find out more at next year's Photokina.