Watch out, Sanyo, because your diminutive HD2 camcorder is about to face some very daunting competition from Canon. Like the recently announced Sanyo, the PowerShot TX1 packs a 7.1 megapixel CCD into a tiny little package capable of capturing 720p HD video as well -- but unlike the $700 HD2, Canon is hanging just a $500 pricetag on this model. Besides its one-two punch of high resolution stills and videos, this device offers a 10x optical zoom (with an optically-stabilized lens), a 115,000 pixel LCD, and ISO settings ranging from 80 to 1600. You're also getting the latest Digic image processor, advanced face detection and red eye reduction, Vista-compatibility, 14 shooting modes, and a so-called "Intelligent Orientation Sensor" to keep the display looking right no matter how you're holding the cam. No word so far on a release date, but with all this functionality at a very attractive price, you can probably expect the TX1 to fly off shelves when it finally makes its debut.

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Canon's compact PowerShot TX1 captures 7.1 megapixel stills and HD video

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Canon's compact PowerShot TX1 captures 7.1 megapixel stills and HD video