One of the best buys out there

Why did I buy this?
I am frequently required to electronically post photos & occasionally videos to illustrate points I am making to my company from a remote location, so I need a camera for work.
As a long term Canon user and lover, I was using my old G2 as a work camera, but it was beginning to show its age, and becoming cantankerous. Since video was becoming more in demand, I wanted something which could take clips longer than 30s, and since I shoot a lot of reflective surfaces I can't use flash, so I wanted something with good stabilization. I also prefer a Li-ion battery, but can live with AA's/Ni-Cads.
My first thought was of Canon, so I looked at what they had, and narrowed my choice to the S3-1S, and the A710IS.
So off I went to Circuit City to try them out. While there, an assistant came over, and asked if I needed help. I laid out my requirements, and immediately he pointed me towards the Panasonic DMC-TZ1. It wasn't a difficult sell, particularly since it was cheaper than either Canon, and was on sale. With the money saved I purchased an accessory kit which gave me a spare battery, extra memory, a screen protector,and a carrying case.

Living with the camera
The camera is simplicity itself to use. on the top plate there is a slider switch for the power, a rotary mode selector, the Optical Image Stabilization pushbutton selector, and the shutter pushbutton incorporating the Zoom slide switch. The power, shutter, and zoom functions are common to all zoom cameras, and should need no explanation, so let us deal with the Mega-O.I.S., and the modes available.

Mega O.I.S.
Panasonics unique Mega-O.I.S. system has two modes. The pushbuuton switch on the top plate will cycle through O.I.S. off, O.I.S. Mode 1, and O.I.S. Mode 2, when pressed if the camera is in Macro mode, Normal mode, or in any of the "Scene Modes". It will only allow "off" and "Mode 1" in video mode, and will have no function in playback mode,or simple mode.
O.I.S. Mode 1 is similar to most other manufacturers image stabilization. Here the stabilization is active all the time, just as it would be on a camcorder. In my experience, this is adequate for most situations, and allows for flexibility. I keep this engaged routinely, and only switch to Mode 2 if I still can't get a good shot.
O.I.S. Mode 2 is the unique part of things. In this mode the image stabilization is in stand-by most of the time, and only activates at the moment of shutter release. This allows for a greater degree of stabilization as the Lens Block stabilization moves into place more quickly. I've only ever failed to get a clear shot in this mode, when I've plainly been trying to operate outside the boundaries of the camera.

Shooting Modes
On the rotary mode selection switch there are icons for the movie mode (a film strip), Macro Mode (a flower), normal mode (a camera), playback mode ( a triangle in a box), Simple mode (a heart shape), and two "scene" modes.
Movie mode allows you to shoot video up to the full capacity of your memory, up to a maximum of 2Gb (which will allow for more than 20 min at the best quality).
Via the menu you can select to shoot in VGA (640x480), or QVGA (320x240), and both are available at 30 frames per second, and 10fps, in 4:3 aspect. In 16:9 aspect you can shoot 848x480 at 30fps.
Macro mode allows shooting of close objects, and the minimum focusing distance will vary on the zoom setting from 5cm (around 2") at the widest setting to 100cm (around 3'3") at the largest zoom.
Normal mode is fairly self explanatory, and will be good enough for over 80% of the shots an average point & shoot user will require. For specialist situations there are the Macro mode, and the Scene Modes.
Playback mode allows the images stored in the memory to be viewed either on the 2.5" display on the rear, on a TV when connected by the included A/V cable, or on a computer when connected by the included USB cable. Navigation, and playback of movies is done through the menu buttons on the rear of the camera.
Simple mode effectively takes the photographer out of the decision making process, over-riding any settings made (such as turning the flash off), and allows the camera to use what it believes to be the best settings for the light pattern being metered through the lens. This is truly "point & shoot".
Now we come to the "scene" modes. Their are 18 "Scene" modes available, for specialist shots, such as portraiture (and one for self-portraits), landscapes (and one for night landscapes), food, parties, candlelight, fireworks, starry skies, beach shots, aerial shots, snow, high sensitivity, and two modes for photographing babies.
in each of these, the camera settings will be biased towards the best for that subject (e.g. a faster shutter for sports shots, and greater depth-of-field for landscapes) and user settings are available within each.
There are two Scene settings on the rotary dial (SCN 1, and SCN 2), and each will retain the last scene mode selected while that position was used. So if you take a lot of portraits, you may wish to leave one on portrait scene. Personaally, I very rarely use these, I mostly use normal, ad macro, but I do like to have the capability, and I'm glad they're there.

In Use
The zoom available goes from 4.6-46mm, which gives a 35mm equivalent of 35-350mm with the CCD in the camera. This means you have a near wide-angle at one end of the range, and a long telephoto at the other. With the digital "zoom",this allows for incredible magnification. Please bear in mind that a digital "zoom" is merely an interpolation of the data, and a loss of quality ensues. Personally I'm not a lover of them, and I've only used it twice, and on both occasions i was shooting something that I couldn't get closer than about 1/4 mile away. I didn't get great shots, but I did get something, so I'm not going to complain about it being there. But if it wasn't there, I wouldn't complain either.
Most of my shots with this are close-up of machiine parts, mostly taken indoors, under industrial lighting, with no flash. I have been extremely impressed with the results I've had. So much so that when I went to Las Vegas on vacation, I took this as back-up to my D-SLR. One point worth noting is that during a trip to the Hoover dam, the electromagnetic field emenating from the generators rendered the electronics my SLR useless, but the Lumix worked throughout, and got me the shots I needed.
On the down side, once we were back outside the Lumix became limited, since I couldn't really see the screen in the bright light, so I had to shoot at a wider angle than I wanted and crop at the print stage. The lack of a viewfinder (either optical or EVF) is the only bad thing I've found with this camera.
The flash options available are automatic, automatic with red eye reduction, always on, on with slow synch & red eye reduction, and always off.
Red eye reduction is just that, it's not red eye elimination. In a compact camera where the flash is so close to the lens, it's impossible to get red of it, but the reduction mode does a good job, and the rest gets taken care with image processing software. I don't expect miracles, and the camera can't provide them, but it does help a bad situation as much as possible.
Though Panasonic do not issue a guide number for the flash, it is good for a compact camera, illuminating dimly lit objects up to 20' away with ease. Certainly good enough for most point & shoot users.
As far as image quality goes, I must admit that I'm an old school photographer, trained on film, and so I shoot with the lowest ISO possible. If I can't get the shot, then I'll trade up. So normally I shoot on the ISO 100 setting, and since I don't yet have the capability to print larger than 8.5"x11", I have seen no noise problems in my shots. I would imagine that if someone bought this for sports shooting, using a ISO 800,and a lot of zoom, there could be an issue, but I've not seen one. All the shots I use look good on a computer, in a digital picture frame, and in print. I always shoot at the 5M pixel setting, reducing image size by software for e-mailing, so I can't really comment of the quality on the lower settings. Why by a 5M camera to shoot at 1M? If you can't get enough shots, by a bigger memory card! I have a 2Gb SD for this, which allows for several hundred shots at the top quality, a big difference from 36 on a roll of 35mm film.
If you do elect to shoot on lower settings, at certain times not all of the CCD is used, which changes the relationship with the lens, effectively converting it to a 12.5x zoom. I've never had a need to do this so far, but I suppose it could be a useful feature.
Menu navigation is no more or less difficult than many other cameras, and the options are well identified. In all honesty, there are so many adjustments & settings available that I don't think anyone will remember the path to all, but as long as you know they are there, you'll be able to find them.
The unit is powered by a 3.7V Li-Ion battery, and a remote charger is included in the package. As far as I'm concerned, battery life is excellent, and remote charging is a bonus. With a spare battery, I can swap quickly, and know that the ougtoing will be charged & ready long before I've exhausted the incoming. A spare battery is something I would strongly recommend for all users, and a large memory card is a must. These days they are so cheap that 512Mb should be within the reach of everyone, and that should be enough for a days shooting, but the more the better!
For movie clips, it is perfect for what I need. I can record for long periods, in an easily e-mail transmittable format, and best of all, the zoom is still active while shooting, so reframing is possible. This feature is unusual, and incredibly useful. Sadly I believe it has been removed from the replacements for this camera (TZ2/3)

Summary
Overall I think this is an excellent piece of equipment. It's capabilities for the size are without equal. The ability to zoom while filming movie clips is great. I know 5Megapixel is not high these days, but the higher megapixel replacements for this do not have this feature. Anyway, 5M is plenty for enlargements up to 8"x10", which is as large as most people go.
As a discontinued item these are getting more difficult to find, but good deals are available. it's worth the search.