Canon plans to build a new CMOS factory in Japan. The new $451 million plant should double Canon's production capacity for digicam sensors.

The interesting thing is that Canon aims to use the new CMOS sensors for its compact digital cameras. Currently these cheaper products are CCD based, while Canon's highly successful digital SLR series are based on CMOS technology. It will be interesting to see the new non-SLR products.

Some of you may remember Sony's innovative R1 from two years ago, the first fixed lens camera to use a full size APS-C sensor. We can only speculate what Canon's plans are. They might opt to for a concept similar to Sony's R1, using the same CMOS as their cheaper SLRs.

The other approach, which would be much more interesting for the average consumer, is to put a new and smaller CMOS in a compact camera. The "smaller" CMOS chip would still be larger than today's tiny and noise plagued CCDs. This might get you less noise, truly usable high ISO settings, and better photos overall. You can probably count on a slight resolution drop as well, but the race for megapixels has become a joke anyway, with producers squeezing as much as 12 megapixels into pocket size cameras.

Only time will tell, but this could end up being one of the most significant change in compact cameras design so far. Canon's new Kanagawa plant should have a capacity of 3 million CMOS chips per year, and production is expected to start in July 2008. By then we'll probably know what Canon has in mind.

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