Now, nearly two years later, the XZ-2 arrives amid a changed landscape. Not only has Canon's G series returned to prominence, but there are strong challenges from Nikon, Sony, Samsung, and Panasonic as well. The $599.99 XZ-2 retains its ancestor's most impressive feature—its f/1.8 zoom lens—and attempts to build on it with a new 12-megapixel CMOS sensor, an innovative dual-mode lens ring, and a tilting touchscreen LCD.

Fantastic physical design, with a smart new dial on the lens barrel

With the XZ-2, Olympus has given its top point-and-shoot a more professional look, not to mention some key internal upgrades. A new removable grip and a tilting touchscreen LCD are major external changes, while inside, a new 12-megapixel CMOS sensor replaces the 10-megapixel CCD unit from the XZ-1. Perhaps the most unconventional design change—and also the best—is the new dual-mode lens ring, which offers both digital (clicky) and analog (smooth) rotation modes. Users can assign each rotation mode its own custom function, making the XZ-2 one of the more versatile advanced compacts on the market.

The XZ-2's new grip doesn't do much to improve its handling.

In general, we're in favor of these advanced compact cameras getting all the ergonomic help they possibly can. Smaller and lighter is all well and good as a design goal, but these cameras aren't likely to ever be pocketable anyway, so why not just make them more pleasant to hold while you're at it? To that end, Olympus has given the XZ-2 a removable grip resembling the one found on the PEN E-P3. Strangely, though, the XZ-2's new grip doesn't do much to improve its handling. We almost prefer the camera without it, as it's awkwardly designed and too shallow to provide any real support.

Beyond these new additions, the XZ-2 stays the course set by the XZ-1. The top plate features the hot shoe, the on/off switch, the zoom ring, the shutter release, and the mode dial. On the left of the hot shoe is the pop-up flash, which is released via a little slider switch just above the rear LCD. The back face of the camera has the customary control cluster on the right, and around front, the only control is the digital/analog toggle for the lens control ring, which also features a secondary function button.

Loads of control tied up in a Gordian knot of poorly-designed menus

Olympus's menus are both a blessing and a curse, as any PEN or OM-D enthusiast can attest. To begin with, they're deep, almost to a fault, and they offer granular control whenever possible. Rather than restricting what you can do with the camera, as many manufacturers do, Olympus tends to give you every option at once. For power users, this is a fantastic bonus, but the effect can be dizzying to new users. And it's complicated by the fact that the menus aren't terribly well-labelled or organized. On photo enthusiast forums, it's not uncommon to see experienced pros complain about an inability to figure out how to do X, even after months of using their camera.

Why hide your light under a bushel, Olympus?

Some of the company's general UI choices are also less than crystal clear. For instance, the Super Control Panel—one of Olympus's best features—is hidden by default, and turning it on requires diving through five or six menu screens to find the option called "Live SCP." How, we ask you, would anyone new to Olympus digital cameras have the slightest clue what "Live SCP" means? Why hide your light under a bushel, Olympus?

Otherwise, the XZ-2 provides plenty of useful features. The sheer volume of art filters and scene modes would be impressive enough, but the camera provides a great deal of control over their intensity and implementation. While this can lead to some sluggish operation at times, the camera is generally quite peppy. We're also big fans of Olympus's use of touch operation, which is identical to that of the company's superlative OM-D E-M5.

The XZ-2 is an improvement on the XZ-1, but not by a wide enough margin.

The Olympus XZ-2 enters a high-end compact camera market that is significantly more competitive in 2012 than it was just a year ago. The fact is, 1/1.7-inch sensors don't do much to impress anyone these days—not in the wake of Sony's bombshell RX100 and its comparably massive 1-inch unit.

We were really impressed by the XZ-2's bright f/1.8 lens.

That isn't to say the XZ-2 takes bad photos—far from it. We were really impressed by the XZ-2's bright f/1.8 lens, which produced sharp results in the lab as well as our real-world shooting. The XZ-2 also benefits from spectacular color fidelity, which placed it among the best cameras in its class. The bright light image quality here is truly great.

Unfortunately, the goalposts have moved. Bright light image quality simply isn't enough to keep up with the field; the new crop of advanced compact cameras, including the Canon G1 X and Sony RX100, feature large sensors that produce legitimately great images in limited light. Cameras with smaller sensors, like this XZ-2, can get by with their aggressive noise reduction for only so long. In conditions where the RX100 produced acceptable images, the XZ-2 more often came back with just a muddled mess.

The XZ-2 does manage to shoot at a respectable 5 frames per second and you can also access a faster continuous burst speed by opting to shoot at a lowered resolution. We're hopeful that Olympus can up this speed in the next XZ-series camera, while perhaps improving the speed of the contrast-detect system so that it's on par with what newer PEN and OM-D cameras are capable of.

Like the Olympians themselves, the is fickle.

It's hard not to root for the scrappy little XZ-2. It packs many desirable features into a compact package, and does it with a sense of style that's distinctly, dare we say it, Olympian. The XZ-2's build quality and design are virtually unimpeachable, and the company has clearly put great effort into trying to make it stand out from the pack. A removable front grip, an innovative hybrid lens ring, and a tilting touchscreen are the most notable fruits of its labor. Olympus has also upgraded the internals, with a new 12-megapixel CMOS sensor and a TruePic VI processor.

Still, after testing and shooting with the XZ-2 for a couple of weeks, we found that its performance was mostly a mixed bag. Overall, it just doesn't improve enough on the XZ-1, and that isn't the camera's only problem. The menu system is incredibly deep, allowing for wonderful levels of customization, but it's also inscrutable. Ergonomically, it takes some nice steps forward, but the grip is largely a failure.

There are bright spots, though. The dual-mode lens ring is a joy to use. In its click-stop digital mode it brings delightful tactility to adjusting aperture, shutter speed, and the myriad other settings it can be mapped to control. When switched to smooth analog control, it provides one of the best manual focusing implementations we've ever seen from a compact camera. The touchscreen is also done right. Though it's not the best we've ever used, it's certainly among the best, and it makes focusing, shooting, and image review a much more intuitive process.

Olympus needs to improve on the XZ-2's image quality in future models, and we sure hope they do, because it's a great platform to build on.

There's no denying that the XZ-2 is an improvement on the XZ-1, or that it's one of the best advanced compact cameras available today. But it isn't the best, and in the end, it's not really all that close. In terms of overall image quality, it's outclassed by the Canon G15, the Sony RX100, and the Nikon P7700. It also costs $100 more than both the Canon and the Nikon, putting it just $50 below the Sony, which is easily the best of the bunch in terms of sheer image quality. In future XZ-series models, Olympus has a few ergonomic and UI tweaks to make, but their main goal should be to get its image quality on a level with the new class leaders—a task that might be made more realistic by the company's new partnership with Sony. We sure they can pull it off, because the XZ-2 is a great platform to build on.

The XZ-2's image quality is something of a mixed bag. Sharpness numbers are solid, if not exceptional, and pretty much right in line with what we saw from the earlier XZ-1. The camera doesn't oversharpen its JPEGs, which is always nice to see, and color and saturation levels are extremely accurate. On the other hand, high noise levels are countered by even higher noise reduction, rendering the upper ISO settings all but useless. Low-light performance is also poor, and distortions aren't exactly brilliantly controlled. Video is also a wash, with great sharpness but odd codec issues and poor results in dim lighting.

Near the head of the class

The XZ-2's color accuracy is among the best in its class, with a best uncorrected color error value of just 2.47 when using the "Muted" color mode. Of the camera's three other non-monochrome color modes, "Natural" and "Portrait" also recorded very successful scores of 2.51 and 2.77, respectively. As one might expect, "Vivid" was a bit further afield, with a smallest error value of 3.33. Saturation numbers were also satisfactory across the board, ranging from 102% in the Muted color mode to 106.7% in Natural, before jumping to 118.3% in Vivid mode (again, as expected). Compare this to a competitor like the Canon G15, whose saturation levels were either way under (92%) or way above (113%+) normal.

This combination of very accurate colors and on-target saturation is a rarity in compact cameras, so the XZ-2 should be applauded. What this means for users is that they can take it straight out of the box and get lifelike shots from the get-go. (Though regardless of what they say, we often find that consumers don't actually prefer accurate colors and saturation.)

The XZ-2 just can't keep up in low light.

It would appear that the only real negative of the XZ-2's switch from CCD to CMOS sensor is its noise performance, which, to be honest, is really pretty bad. While the XZ-1 was among the best of its generation, the XZ-2 lags behind its contemporaries and even its predecessor (up to a point).

The XZ-2 includes settings for both Noise Reduction (in reality, long-exposure noise reduction) and Noise Filter (high-ISO noise reduction). The latter is what most people think of as NR, so you can file this away as just another in Olympus's long history of strange menu decisions. The default setting for Noise Filter is Standard, but Off, Low, and High options are also available. Using the default setting, noise levels start at 0.80% at ISO 100. They hit 1.22% at ISO 400 and stay below 2% until ISO 6400, maxing out at 2.13% at the top ISO setting of 12800.

However, those numbers don't tell the whole story. With NR Off, noise levels exceed 2% starting at ISO 400 and max out at 4.79% at ISO 6400, before dropping again at ISO 12800 due to a sheer lack of detail. This indicates that the "Standard" NR setting is doing some very heavy lifting—an impression confirmed by our test scene crops, which look really, really awful at the top two ISO settings. On the whole, we can't recommend shooting anything above ISO 800 if you want to preserve a reasonable amount of fine detail. ISO 1600 and 3200 shots will look okay when re-sized for the web, but 6400 and 12800 are a wreck.

The f/1.8 lens is plenty sharp, without much processing required.

Despite the change from a 10-megapixel CCD sensor to a new 12-megapixel CMOS unit, the XZ-2 performs nearly identically to its predecessor with regard to sharpness. It's not the sharpest sensor/lens combination we've ever seen, but it's in the ballpark of "very solid" performance. Generally speaking, it's sharpest at full wide angle, dropping off a bit in the middle focal lengths, and then picking up again toward full telephoto. In the real world, it produced very pleasing results at low ISO settings, before noise and noise reduction come along at high ISO to crash the party.

It's also worth noting that, unlike many recent advanced compacts, the XZ-2 doesn't seem to apply excessive in-camera sharpening to its JPEGs. In-camera sharpening is like salt: you can always add it, but you can never take it away. While we've seen sky-high oversharpening numbers from cameras like the Samsung EX2F and Canon G15, Olympus tones it down. Those cameras' sharpness figures ranged from 130% to 150% of normal, producing ugly dark outlines around high-contrast objects. In contrast, the XZ-2 rarely rises above 110%, and as a result, the photos you get look a great deal more natural on a per-pixel level.

Not our favorite compact camera for video, but an able performer in the right conditions

In ample light, the XZ-2 is a capable video performer, though it does have a few odd quirks. Generally speaking, artifacting and trailing are kept to a minimum, and the 30fps set framerate in 1080p and 720p shooting provides a smooth viewing experience. However, our motion test did show some odd "tearing" behavior in high-frequency movement areas (as with a black and white wheel in one of our test videos). This problem is evident when the video is playing, but disappears as soon as it's paused, which leads us to believe it's a codec issue.

In dim light, artifacting gets much more apparent and trailing becomes a real problem, but video playback is still smooth and reasonably pleasing to view. The sensor's poor low-light sensitivity does produce a slightly underexposed image, though, and this problem only intensifies the lower the light gets.

Overall, the XZ-2 just can't keep up with the Joneses.

We found the XZ-2 to be a fairly average performer, overall, at least among its advanced compact competitors. It does have some admirable test scores—dynamic range, for example—but many of these are the result of some in-camera assistance. Even though the XZ-2 has switched to a more modern CMOS image sensor, it doesn't appear to have caught up to the rest of the field. The biggest gap is sheer sensor size, which is very difficult to overcome by software processing alone. While we have to admire the XZ-2's effort in most of our testing, the simple truth is that it lags behind cameras with bigger sensors. We wouldn't be surprised, in fact, to see Olympus opt for a larger sensor in the next XZ-series camera in order to keep up with its rivals.

Meet the testers

Ben Keough

Ben Keough

Contributor

@ben_keough

Ben is an experienced industry journalist who formerly served as Senior Editor of News and Features at Reviewed. He now contributes as a freelance writer and editor. Most recently hailing from the vast wilds of the American southwest, he is an avid photographer who is deeply disturbed by the lack of wide open landscapes in Boston.

See all of Ben Keough's reviews
Ben Keough

Ben Keough

Contributor

@ben_keough

Ben is an experienced industry journalist who formerly served as Senior Editor of News and Features at Reviewed. He now contributes as a freelance writer and editor. Most recently hailing from the vast wilds of the American southwest, he is an avid photographer who is deeply disturbed by the lack of wide open landscapes in Boston.

See all of Ben Keough's reviews

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