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The Sony Cyber-shot DSC-T500 features a 1/2.3" Sony SuperHAD CCD sensor with a sensor resolution of ten megapixels, coupled to a Carl Zeiss Vario-Tessar branded 5x optical zoom lens that offers a range from a moderate 33mm-equivalent wide angle to a useful 165mm telephoto. The DSC-T500's lens incorporates Sony's Super Steady Shot optical image stabilization to minimize blur caused by camera shake at slow shutter speeds. Maximum aperture varies from f/3.5 to f/4.4 across the zoom range, and a minimum aperture of f/10 is possible regardless of zoom position. With no optical viewfinder on offer - an increasingly common situation on modern digital cameras - image framing and playback on the T500 is achieved solely on a 16:9 aspect ratio 3.5" display with 230,000 dots of resolution.

The Cyber-shot T500 is capable of recording 1,280 x 720 or 640 x 480 pixel videos at 30 frames per second, with the ability to use the optical zoom while videos are being captured. There is, however, a ten minute limit on the length of video clips shot at the full 1,280 x 720 pixel resolution. An unusual ability is that the Sony DSC-T500 can actually capture photos during the recording of videos, saving up to three still images with a press of the photo button while a movie is being captured. The Cyber-shot DSC-T500 also includes Sony's face detection technology, which is capable of detecting eight faces simultaneously, and is linked to both the camera's autoexposure and autofocus systems as well as to flash metering. ISO sensitivity from a minimum of ISO 80 equivalent to a maximum of ISO 3,200 equivalent, and shutter speeds range from 1 second to 1/1000 second.

Power comes from a proprietary Type-D 3.6V InfoLithium rechargeable battery. The T500 offers USB 2.0 High-Speed connectivity for connection to a personal computer, and also features both standard definition NTSC / PAL video output as well as high definition HDMI connectivity for viewing on the latest HD televisions - this latter requiring the purchase of an optional HDMI cable. Images and videos shot with the Sony T500 are stored on Memory Stick Duo, PRO Duo, PRO HG Duo or PRO Duo High Speed cards, although there is no speed advantage to the latter type when used in this camera. The Sony DSC-T500 also includes a frankly pointless 4MB of built-in memory - enough to store one solitary image or two seconds of video at the camera's full resolution.

The Sony Cyber-shot DSC-T500 ships from September 2008 priced at US$400, and the camera will be available only in a black brushed-metal finish. The Sony DSC-T500 product bundle includes Picture Motion Browser software, USB and standard-definition video cables, and a Lithium Ion rechargeable battery with charger.