Keeping up with the camcorder industry can be a pretty tough undertaking. Sometimes, it feels like a new video format is launched every other week, with no end to the madness in sight. Whenever we turn our backs, another form of recordable media leaps out of the woodworks to confuse and frighten us, like some unknowable high-tech monster in a Japanese horror movie. SD or HD? DV or DVD? HDV or AVCHD? The multitude of competing formats and video codecs is getting out of hand -- which is why it makes perfect sense to invest in a hybrid device. After all, if your camera can handle more than one format, it has less chance of becoming obsolete, right?

Panasonic's HDC-SX5 records high-definition video to both DVD discs and SD/SDHC memory cards, making it a versatile choice for indecisive consumers. It can capture moving images at a maximum resolution of 1920x1080i and offers an overall recording time of up to 240 minutes. While its video results are sure to astound you, a few minor design flaws have marred its overall performance.

The first thing that leaps out about this camcorder is its physical design -- and not in a good way. It has been a long while since we've reviewed a model quite so blatantly unstylish; especially in this price range. Compared to the sleek aesthetic of other SD cams, such as the Sony HDR-CX7K and Panasonic HDC-SD5, the HDC-SX5 comes off as distinctly second-rate. In addition to being dull and bulky, the overall look is further compromised by its protruding battery. All up, this is one pug-ugly unit.

Of course, good looks aren't everything. A sense of humour is also important, or in the case of a camcorder, the ability to take great video. Thankfully, this is one area in which the HDC-SX5 more than holds its own. Recording in the AVCHD video format developed by Sony and Panasonic, the unit captured some of the best test footage we've shot to date. Thanks to some fancy engineering, the unit is able to record 1920x1080i high-def video via three 520K pixel CCD sensors. Mathematically this doesn't seem to stack up, but the results speak for themselves.

Whether recording to SD card or DVD disc (DVD-R, DVD-RW, DVD-RAM and DVD-R DL are all recognised), the footage we shot was universally fantastic, with an intelligent balance between vibrant colours and natural tones. Naturally, it faired a lot better in sunny outdoor environments than it did indoors, where noise swiftly became evident under dim lighting. Nevertheless, its overall performance was top notch, delivering stunning true-to-life HD visuals that should please even the most exacting videophile.

Unfortunately, the dual-nature of the HDC-SX5 does not extend to its stills mode -- with a maximum resolution of just 2 megapixels, this definitely isn't a hybrid device that will replace your compact camera. Although suitable for taking the occasional happy snap, don't expect to make medium-sized prints.

When it came to functionality, we were mostly pleased with the unit's layout with a few minor exceptions. In a presumed attempt to free up camera space, the directional stick is cunningly built into the control dial (so cunning, in fact, that we initially overlooked it). Unfortunately, its tiny size makes it easy to accidentally shift the stick in the wrong direction, which leads to a hellish menu experience. This is quite a shame, because otherwise, the menu interface is intuitively laid out and straightforward to use.

When it comes to modes and features, all the usual suspects have been duly assembled, including manual focus, white balance, adjustable shutter speeds, a 10x optical zoom, an external microphone port, programmable AE modes and an advanced image stabiliser.