Digital cameras zoom into mainstream

But put the International Data Corp. figures in the context of full annual sales, and the picture zooms into much sharper focus.

"Generally figures for Q1 are softer than what we've seen this year, and it's a sign that digital photography is catching on with the mainstream," said Chris Chute, research analyst at IDC and author of the report.

IDC expects 5.1 million digital cameras to be sold in 2000 -- with a majority being sold in the second half and particularly during the holiday season.

By the end of the year, Chute expects digital cameras to be considered mainstream among technology fans, especially as prices fall.

Prices are not likely to drop as much as last year, when the introduction of 3-megapixel cameras pushed prices of lower-resolution cameras down. But a slight decrease is expected.

A new breed of 4-megapixel cameras under $2,000 will be available this holiday season, but these units are expected to address the untapped professional user market, and not mass-market amateur photographers.

That's because the price difference between 3- and 4-megapixel cameras is still roughly $1,000 -- hardly a lure to the amateur.

These higher-resolution cameras will be targeted at more advanced photographers who are willing to pay more, says Alexis Gerard, president of Future Image. It's a market segment that has been largely ignored.

"Professional photographers have been more cautious about digital photography than consumers, who have essentially embraced it," said Andrew Johnson, analyst at Dataquest.

The first major manufacturer to announce plans for such a 4-megapixel camera is Olympus with its Camedia E-10, which according to the company will be available in November for $1,999.

Olympus officials said the offering -- aimed at studio and fashion photographers -- will accept both SmartMedia and CompactFlash removable storage media and will support optics for the better-detailed pictures than what has been available at that price.

Gerard sees this as a good move for Olympus to stay at the forefront of the market and expects other manufacturers to be jumping on-board with their own offerings shortly.

In the next couple years, digital cameras will become more affordable, and 1-megapixel will become the point of entry, says Chute of IDC.

As more consumers buy the cameras, manufacturers will respond by developing more ways to view the photographs, he said.

Several companies are already working on the future.

Kodak (ek) has announced a set-top box with Scientific Atlanta with which consumers will be able to view, organize, share and order digital pictures.

And Sony (sne) with its CyberFrame allows photographers to view pictures directly on a picture frame.