Is Apple working on a digital camera?

MacSlash picked up on a Macsimum News report that Apple has been awarded a patent reissue for an "Apparatus and method for rotating the display orientation of a captured image", which smells quite a bit like part of a digital camera. (I also learned something from their post: this image isn't a Photoshop job – Apple actually had a digital camera by the name of QuickTake, way back in 1997. Ahead of the times, were we Apple?).They also feature some detailed information from the patent (but not the entire patent), explaining the apparatus and its imaging subsystem.

Macsimum News also notes that Apple is long overdue for a digital camera, what with iPhoto, the new Aperture and some "iPod" thingy that's so popular with the kids these days. Yet I can't help but wonder: how many toes could Apple step on here? The company has been introducing software that's made a few competitors jump the OS X ship already (Adobe Premiere, anyone?), which makes me worry that a digital camera from Apple could damage at least the consumer level imaging support from the likes of Canon, Sony and Nikon. While I love Apple's stuff and I believe in their design abilities, I'm sure it's possible for even the Mighty Fruity to spread themselves too thin. Guess we'll all (hopefully) see what Apple has cooking at the upcoming Macworld in January '06.

[UPDATE: I'd like to thank Jared C. Benedict for the image, which came from the Wikipedia entry about the QuickTake camera]