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It's 2010. Sure, the cam of the Iphone 1 sucked even more. That's no excuse for having bad cam in Iphone 4. For better results, check any video / pictures from say Samsung i8910, Nokia N8, SonyE Vivaz.

I think it's fair to say that the optics/image capture dept at Apple is a lot weaker and more inexperienced than say the product design, interface and OS depts. Apple as a company seems not that focussed on image capture, only the user experience post-capture.

But then you could ask why would a computer company be experts at photography? Microsoft don't make any good cameras either :)

Apple Inc would ned to poach a serious optics/imaging guy from another company to change the situation, I think.

PS the Sony Vivaz clips I've seen don't look that great. Only the N8 has impressed me so far.
 
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