The LX5 is the successor to the beloved LX3, a high-performance compact in league with the Canon G11 or the Samsung TL500. It's the kind of camera that hardcore photographers carry around as a supplement to a dSLR setup, one that's portable but powerful. Since the target audience is so discerning about their equipment, the LX5 should get the photo enthusiasts all riled up – the nit-picking has already begun at a few photography forums.
We've had the benefit of a brief hands-on with a pre-production version of the LX5. It's impressive, and at the very least, a worthy upgrade from the LX3. The new lens is similar to the old one, a 24mm (equivalent) Leica starting at f2.0, but with a longer 3.8x zoom lens this time around. It still packs a 1/1.63-inch, 10 megapixel CCD sensor, which as large as any that you can find in a compact camera (that's a good thing), but there have been some tweaks that Panasonic claims will allow for faster performance and better low-light shooting. It's paired with the brand new Venus Engine FHD processor. Panasonic claims that it can “separate chromatic noise from color borders,” so when noise reduction does kick in, it should look much less smudgy than we typically see from compacts.
Talk is cheap, but the Panasonic reps showed us some sample images comparing shots at ISO 3200 from the LX5, LX3, G11, and TL500. The LX5 shots were noticeably sharper less noisy than the shots from its competitors. (The LX5 does extend to ISO 12800 at lower resolutions, if that's your thing.) Obviously, we want to see some independent sample images, but the LX5 looks like an incredibly promising camera. We wouldn't be surprised if Canon fired back with a new G Series model any day now, but it looks like it will have some stiff competition from the LX5.