We saw the prototype of the E-P1 behind glass at a number of shows in 2008, but always questioned whether Olympus would actually go through with the nostalgia-infused camera that is the new Pen. We spent the day with the new Micro Four Thirds model at the launch in Berlin, Germany.

The Micro Four Thirds format allows for a more compact body over a traditional SLR, by doing away with the mirror box and prisms that make up the viewfinder elements, but still retaining a changeable lens system. So far we've only seen two retail models in this format from the Panasonic G system.

Olympus' take is distinctly different. Where the Lumix G1 and GH1 have an electronic viewfinder, Olympus has gone without. What you do have, however, is a 3-inch LCD display on the back, sitting next to various controls on the right.

It is quite a large camera, which fits with the retro design, and is a good size and weight in the hand. The quality of construction is good: it feels like a premium product. The controls all fall easily under the fingers and thumbs, with the left-hand mode dial interestingly set in the bodywork. The right-hand sees not only a regular four-way navigator/shortcut arrangement, but also a vertically-mounted scroll dial, a breeze to flick round with your thumb to change settings as you go.

It takes a while to get familiar with the E-P1 in terms of physical handling. The size and the fact you have to zoom using the lens, means it feels like a DSLR. Raising it to the eye is second nature, especially when you want the additional stability to rotate the lens. This is partly because we are used to the DSLR - those with viewfinder-less compacts probably won't encounter this.

If you want a viewfinder, you'll be able to get an optical one as part of the 17mm pancake lens kit. Unfortunately it doesn't give you much other than a way to line up the camera, no head-up information or anything else. (Reports suggest that a camera version with a viewfinder might be coming in the future, however.)

In our tests we used the 14-42mm zoom kit lens. It looks compact, but it actually locks down, so when you use it you have to release it and extend it before reaching the 14mm setting. This perhaps accounts for the smaller dimensions than the Panasonic Lumix G 14-45mm lens, although there is little between them in reality. Just to reassure ourselves, we did try swapping the lenses over, and both cameras seemed happy.

However, it's more likely that you'd want to take advantage of the adapter rings, both the Four Thirds and OM lens rings, to widen the variety of lenses available to you.

Another omission, despite the large body is a flash. This is perhaps an odd move, because if you want a flash, you'll have to deploy the hotshoe variant at extra cost. You could use any third-party flash too, unless you are totally sold on the design theme here, which would give you a number of advantages as the Olympus FL-14 accessory flash is forward facing only.

Full-auto shooting comes thanks to Olympus' iAuto setting which is pretty good. It our tests it did seem to identify the scene and pick out settings to get good results. To get to the more creative options, you'll be able to flip over to aperture and shutter priorities, a program mode, full manual control, or even scene selection modes as you'd find on pretty much any compact camera.

Also packed in is Olympus' Art Filters that have made their way into their DSLR models. Great fun and easy to use, we love the pinhole and pop art modes, with a couple of test shots shown here using those.

Video is supported too, which requires moving the dial to the video option, unlike the instant record option that the Lumix GH1 features. Filming in 720p HD at 30fps the results are very good, and we've already shown a teasing clip here on Pocket-lint, link below. There is a variety of control options for the video too, better (on first glance) than some other DSLRs with video. How it compares to the comprehensive GH1 we'll have to examine in more detail when we do a full review of both cameras.

You can apply the Art Filters to video too, which can give some interesting results. Some work better than others: the over-saturated pop art option does nothing for skin tones, for example. The stereo audio captured is also very good, with two mics mounted on the front. Audio did seem to be affected by wind noise however, something to bear in mind outdoors, with no external mic socket.

An HDMI sits under a flap on the right-hand side along with the normal Olympus USB connection. The battery and SD card slot is accessed through the bottom.

First impressions of the image quality are good. Colours are striking giving beautifully rich blue skies. Although noise creeps into shadows and higher ISO shots, we didn't extensively test this so we'll reserve final judgement until we've had the camera in for a full review.

Plenty of control options mean you can really let your creativity come to life and the auto settings and art filters mean there is something for everyone here from a shooting point of view, making it a great deal of fun to use. It is snappy, fast to respond, and simple to use.

We're not so sure about the design though. Given the size, we were disappointed by the lack of viewfinder and flash. Not that these things are essential for everyone by any means, but when you come to daily shooting, this might be what you miss the most.

Having to carry around a collection of extras might push you back towards a compact, or the offering from Panasonic. The HD movie capture does sweeten the deal however, especially given the price comparison to Panasonic's GH1, which is considerably more.

Price when reviewed:
£699 (14-42mm zoom kit)

First Impressions

It's difficult to predict whether the retro styling of the E-P1 will win over fans when practical considerations come into place. It might be a little too large for ladies to slip into a clutch bag, or gents to slip into a jacket pocket, but if you have the new Pen, you're going to want to show it off, so maybe size doesn't matter?

Talking to other journalists on the day, divisions were already showing. Some loved the retro styling and the level of control you get: a perfect fun second camera to choose over a compact. But on the other side were the set that felt it didn't quite deliver the experience they wanted given the size - the lack of viewfinder being the most common niggle.

The Olympus E-P1 is a true hybrid, falling into the space between compact and DSLR. Whereas the offering from Panasonic has the appearance and layout of a DSLR, the E-P1 is distinctly different in its offering and may, for some, be more appealing as a result.

We'll be getting our hands on the E-P1 for a full review shortly.