I read an article in a magazine a week or so ago about how bigger sensors provide better pictures, or at least pictures that could be blown up more and how this effected the importance of megapixels. Today I found, via Gizmodo, an article on sensor size.
The other important fact about sensor size is it dictates lenses for cameras. In the past all cameras by a particular maker were focused on the same size area, the 35mm film square. So interchanging them wasn’t that hard. Now sensor size may vary from camera to camera even by the same maker. And when they want to make the next best camera they may change sensor size, make old lenses not work with new cameras. Which makes for a whole new economic model of buying lenses for your SLR.