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I think they're great but they have their limitations. However the average person taking vacation pics probably won't run into them. The average person usually doesn't get enlargements greater than 8x10 so the resolution is adequate.
I think it will be quite some time before they approach the quality of medium and large format cameras.
One suggestion; avoid anything with "digital zoom" stick to optical zoom. Digital zoom is the same as using the zoom in photoshop. Same number of pixels for a larger area. optical zoom doesn't lose quality.
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