Nice camera, everything is down the middle

Author's Rating:

Pros: Small size, great body, video quality all the required connections

Cons: Poor still images, battery life, expensive accessories

The Bottom Line: 
Its a good buy, sony has gone down the middle on almost everything, CCD size, stills, price, zoom, only things that are excellent are video quality and ofcourse sony brandname.

Author's Review
I bought the HC40 for a variety of reasons. I wanted a small sized camcorder, and sony has the best reputation, I have had a good experience with other sony products. Though the sony products tend to be more expensive than similar products from other companies.

The DCR-HC40 is a good option for those looking for nice video and stills in a compact camcorder. Offering a 1.0 Megapixel CCD imager, this high quality camcorder delivers 10X Optical/120X Digital Zoom and Carl Zeiss optics for incredible picture clarity. It has a 2.5-inch Hybrid SwivelScreen Touch Panel LCD which after you get the hang of it is actually easy to use. But initially its a pain and I am always afraid if it will damage the LCD by repeated tapping, though sony says the LCD's can take it.
Carl Zeiss Vario-Tessar Lens helps you shoot like a pro its really good quality and the video quality is really good. I had previously bought canon optura 20 and the picture quality was very grainy and dull as compared to the sony. I actually ended up returning the canon and then buying this sony HC40.It's very portable.
It has a Advanced HAD CCD Imager 1/5-inch Advanced HAD (Hole - Accumulation Diode) CCD with 690K (effective) pixels provides excellent detail and clarity, with exceptional video performance (up to 520 lines of horizontal resolution). Though the CCD size is small and I am sure it reflects on the picture quality somewhat as all the experts on the web seem to think so, but I haven't noticed that in the picture quality, so my guess is that a common consumer who is not too much into the technical details but only wonders about the picture quality will not feel any difference. Still pictures are not upto par with even the cheapest digital still (still images utilize 1000K (effective) pixels).
MiniDV Recording - Offers up to 520 lines of horizontal resolution, 3X color bandwidth (vs. VHS) and significantly higher S/N ratio, to provide stunning video performance. 10X Optical/120X Digital Zoom - just average on most camcorders these days.

Overall
The HC40's design is excellent. It's very compact, and I like the built-in lens cover. Sony has eliminated nearly all of the buttons from the body, putting them instead onto the touchscreen LCD which can be a good thing or bad it is upto the user to decide. The video quality is very good and that's what matters the most. Still quality is nothing to write home about but then isn't that true for all the digital camcorders.