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The biggest digital camera maker in the world isn't Sony, Kodak, Nikon, Canon or Olympus. As it turns out the top spot is held by a cell phone manufacturer: Nokia.
In fact, cell phone makers last year sold more digital cameras than digital camera makers did.
Some 84 million cell phones with built-in digital cameras were shipped worldwide in 2003, almost twice the number of conventional digital cameras exported.
This year, sales of camera phones are projected to double, to 174 million. And they will be used to snap 29 billion photos this year, compared with 67 billion photos taken with digital cameras.
Still, up until now, most of the camera phones sold in the United States were able to produce only grainy photos, good enough for e-mailing or posting on the Web but not worthy of printing. Most of these phones take photos made up of 300,000 tiny dots.
For printable photos, most people have turned to megapixel digital cameras that can produce images made up of a million or more dots. The more tiny dots, or pixels, the higher the resolution of the picture. A megapixel is 1 million pixels. Now, phone makers are incorporating megapixel cameras into their handsets.
"The advent of megapixel camera phones really takes the camera phone out of the novelty realm and really creates a practical product," said John Chier, spokesman for cell-phone manufacturer, Kyocera Wireless Corp. "Now you have the ability to print the pictures."
Recently, Sprint began selling the first megapixel camera phone in the US, a 1.3-megapixel handset built by Audiovox. But they are already prevalent in Asia. The first megapixel camera phone ever - made by Sharp - was introduced in Japan last year.
In May, Japanese carrier KDDI began offering a 3.2-megapixel camera phone built by Casio. And recently, Samsung Electronics unveiled its 3.2-megapixel camera phone for consumers in Korea.
By 2006, more than half of all camera phones will have a resolution of 1 megapixel or better, according to Strategy Analytics Inc, a market research firm.
For phone makers, it doesn't take much to turn a phone into a camera.
"Ninety per cent of the cost of the camera today is already in your cell phone," said analyst Albert Lin of American Technology Research. "The only thing the cell-phone maker has to add is the lens, the optical capture module and a semiconductor."
Phone makers are also fueling the market for camera phones by adding standard camera features consumers have come to expect, such as built-in flashes and red-eye reduction. Some phone makers are even building their phones to look like conventional digital cameras.
"It's gotten to the point now where when we introduce phones, it's much more of an oddity for the phone not to have a camera," said Nokia spokesman Keith Nowak.
Phone makers can sell their megapixel camera phones for top dollar. The Audiovox phone offered by Sprint retails for $300.
Cell-phone carriers make money, as well, by charging higher fees for sending photos.
Lin, the analyst, thinks that eventually phone cameras will supplant digital cameras.
For now, though, according to Brad Akyuz, mobile wireless analyst for Current Analysis, the average new camera-phone user quits taking pictures with the device within a few months after purchase.
In the long run, while more megapixels in a camera phone means higher resolution photos, megapixels aren't the only measure of a digital camera.
"There are other factors that prevent camera phones from being comparable to the images you'd see in a digital still camera," said Jill Aldort, a consultant for InfoTrends. Among them: the lens, the zoom feature and the flash.
"Digital cameras, in general, will continue to provide better image quality," Aldort said. "Eventually, it's likely that consumers are going to end up owning both a camera phone and digital camera."
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