Prior to this launch, people interested in photography would typically still use film based SLRs, or digital cameras without interchangeable lenses. So it is fair to say that the camera started a big change in the camera market: Affordable digital system cameras. Here is a look at what has happened over the last decade.
The Four Thirds system was created by Olympus and Kodak. It was designed from the ground up for digital, e.g., the lenses were telecentric, or at least almost telecentric. This design choice stemmed from the digital sensors inability to register light coming in at an angle. While the shorter register distance allowed for creating smaller lenses, demanding the lenses to be telecentric makes them larger again. So some of the size advantage was lost.
In January, Nikon launched their answer to the Canon EOS 300D, the D70.
The image sharing service Flickr was created in 2004. It became a popular site for photo enthusiasts to share their work. The trend of using large sensor cameras in combination with fast lenses to create thin DoF photos was popularized on Flickr. Previously, fast normal lenses had a large aperture to give a bright viewfinder and aid focusing, not because people expected to use them wide open.
The first digital mirrorless interchangeable lens camera was released: Epson R-D1. It takes Leica M mount lenses, and, unusually for a digital camera, it has a mechanical shutter that must be cocked manually. A total of three different versions of the camera were released.
Panasonic joined Four Thirds, together with Olympus. The following year, they would release the Lumix L1, based on the Olympus E-330. It was later idolised for having a Leica rangefinder like body.
Sigma released the 30mm f/1.4 lens, the first fast normal lens made specifically for digital cameras. At the same time, they also created the 10-20mm f/4-5.6, an affordable ultra wide zoom lens. Both lenses were important in opening up new possibilities for DSLR users: Thin DoF images, and ultra wide angle images.
The Nikon D40 was released. It was the first truly compact DSLR camera (with an APS-C sensor), and it was popular for achieving a good image quality at high ISO, much thanks to keeping the megapixel count relatively low at 6MP.
Sony acquired the camera operations from Konica Minolta, and released the Sony Alpha A-100, their first DSLR. It started a spree of product development, and we would see Sony creating a number of new imaging systems.
Pentax released the K10D. They had some DSLR models out before the 2006, but they were rather odd. The K10D was the first to really make a mark. It combined an ergonomic body with a photographer centric interface, weather protection, and in-body image stabilization. All this at a relatively low price.
The Olympus E-330 was the first live view capable DSLR camera. It achieved the capability by utilizing a second sensor inside the viewfinder assembly.
The Leica M8 was released, Leica's first digital rangefinder camera. The sensor was custom made for the camera, with microlenses offset to account for the Leica lenses non-telecentric design. One of the reasons why Leica lenses are so compact, is that they are designed so that the light hitting the corners of the image comes at a steep angle. This makes them less suited for use on digital cameras.
The Sigma DP1 appeared. Not a very successful camera, due to very slow operation, and a sensor with poor high ISO capabilities, it would still lead the way for future premium compact cameras, featuring a large imaging sensor and a relatively fast lens.
On September 12th, 2008, the Panasonic Lumix G1 was announced, the very first Micro Four Thirds camera. It was a true revolution in photography: A compact system camera with very photography oriented ergonomics and functions: A good EVF, tiltable LCD, a rugged body with an easy to grip surface. The autofocus was surprisingly fast, even if AF-C was not very useful. It had one strange omission, there was no video mode.
Even though it was paired with what is widely seen as a fantastic kit zoom lens, the camera was pretty much ignored.
It was not until Olympus launched the E-P1, with a retro styled, metal clad body, that the interest in M4/3 took off. Even if the E-P1 was inferior to the Lumix G1 in terms of usability and functions, in my opinion, and it was paired with an inferior lens.
Sony released the Alpha A-900, the first full frame DSLR to feature in-body image stabilisation.
Live view became a must have feature by 2008, and virtually all subsequent system cameras have this feature now. Mirrorless cameras are essentially full time live view cameras.
Samsung announces their mirrorless range called NX. The Samsung NX mount is unusual for mirrorless cameras, in that it has a relatively long register distance, almost as long as the Leica M mount. The cameras don't emerge until 2010.
Not an affordable camera system, of course, but Leica released their full frame M mount camera in 2009, the Leica M9. It was the first full frame mirrorless camera.
Sony introduces yet two more systems, the SLT range of DSLR cameras with a semi-translucent mirror, and the mirrorless NEX range, with a new E-mount. It is later revealed that the E-mount supports full frame sensors, even if all initial cameras have an APS-C sensor size.
The smartphone app Hipstamatic appears, later to be dominated by Instagram. These image processing and sharing apps help drive the photo interest, and, at the same time, cause huge problems for the camera industry. With smartphones getting better cameras, and people becoming more interested in sharing pictures immediately, they use their phone for their photographic needs, not a compact camera. This will lead to a huge loss of sales volume for camera makers.
The Fujifilm X100 became available. It was the first really successful large sensor premium compact camera. Combining old style look and feel with an innovative viewfinder system, it became a big hit with photo enthusiasts. The retro styling would become the norm for future Fujifilm releases, including their mirrorless X mount offerings.
Nikon's mirrorless 1 system was announced. The name hints to a 1'' sensor, fairly small for a system camera. Initially, the system got a mixed reception, as the cameras had poor ergonomics, and a high price tag. It was unclear exactly who the system is for: Fashion conscious consumers who want pink camera kits, or enthusiasts who want an ultra fast portrait lens? Both exist in Nikon 1.
Nikon reintroduces the megapixel race by packing a massive 24MP in the entry level Nikon D3200. The predecessor had 14MP, and the D3000 from 2009 had only 10MP. At the time, 24MP is a higher resolution than any previous Canon DSLR cameras, including the high end ones.
Sony announced the VG900 camcorder, which has a mirrorless E-mount, and a full frame sensor. At the time, no full frame E-mount lenses were available, so it came with an adapter for using A-mount lenses. It was the first camera to confirm that the mirrorless E-mount supported full frame sensors, hinting to a future full frame mirrorless camera.
Canon released their mirrorless system, the EOS M. The first camera was a huge disappointment: Virtually no features, dreadfully slow autofocus, and only two lenses available (three if you are in Japan). Since this time, one more camera has appeared, but it does not appear that Canon is investing a lot into the system.
Sony released the RX100, a revolutionary premium compact camera. It started the "sensor size war", which is still upon us to this date. The consumers now know that the sensor size is of importance, especially people in the market for premium compacts. 1/1.7'' sensors used to be the norm for this segment, but Sony significantly upped the bar to 1'' sensors.
The Metabones Speed Booster adapters were announced. With them, you can take a legacy SLR lens, and use it on a crop mirrorless camera with the original field of view, and a larger aperture. It also claims better sharpness, and the invention led to an increased interest in legacy SLR lenses.
In 2013, Wifi support became a must have feature. Most cameras are now released with Wifi connectivity, enabling you to transfer pictures to a smartphone, and even to control the camera remotely.
Blackmagic released some video cameras with common lens mounts, e.g., Canon EF and Micro Four Thirds. Their impact on the amateur enthusiast market is limited, as the cameras require a lot of competence to get the most out of.
The Lumix GH4 (my review) was released, the first 4k capable consumer system camera. Samsung later announced the NX1, which also features 4k video, has a much higher resolution than the GH4, and can record 4k video using the whole sensor area. On the other hand, Samsung's NX lens lineup is far from as impressive as that of M4/3. Also, Samsung NX lenses tend to be larger.
The GoPro IPO took place in 2014. GoPro had a big hit with their Hero line of action cameras. Most video cameras sold these days, are in fact GoPro action cameras.
What can we expect for the future? The camera market is still in a crisis, from the smartphone domination. But premium compacts still sell well, and we see a tendency for this segment to gain larger sensors, e.g., the Canon G7 X and Lumix LX100.
Sony started the mirrorless full frame craze with the Sony A7 line, and I expect them to continue to grow in this segment, as long as we have the "sensor size war".
Canon needs to release a proper line of mirrorless system cameras. Their EOS M offerings are not convincing. Nikon has gotten further with their 1 line of mirrorless cameras, but the confidence in it is not very high.
Micro Four Thirds still has an edge in the mirrorless segment, with a very good lens lineup. But there are many other players who want a share of this segment, with Sony and Fujifilm being next in line.