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

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.