The ruggedized point-and-shoot(p&s) cameras saw greater focus in the last couple years due to the eroding of the regular p&s market by smartphones. With intrusion protection being the new bullet point on high end phones' feature lists, this niche market is going to be impacted as well.
Despite all that there still seems to be a significant market for p&s cameras, Sony has no less than 20 different p&s cameras. Most of those cameras seem to be variations of the same base model. That sort of variation seems to imply there's a significant demand.
It implies that it's easy to create such cameras. Which is true -- I work for a consumer electronics company and it's pretty amazing how good Chinese manufacturing has gotten.
This is no guarantee people are actually buying these things -- i.e. that there is demand. Hyper segmentation is often a signal of the exact opposite -- micro demand, but not macro.
Despite all that there still seems to be a significant market for p&s cameras, Sony has no less than 20 different p&s cameras. Most of those cameras seem to be variations of the same base model. That sort of variation seems to imply there's a significant demand.