You go through the stores and look at the camcorders and see zoom numbers from 2x to 50x and even beyond. You know you want a camera that can get you closer to the action so the highest number is all that matters, right? Unfortunately, it's more complicated than that. There’s a lot more to zoom than that number in front of the “X”, but the most important distinction is between optical and digital zoom.
Optical zoom is the kind of zoom that you want. It uses the camera's hardware to get you closer to your subject. By changing the distance of the camera’s lens from the image sensor, or moving 2 elements of the lens closer together and further apart, subjects will appear to be closer than they actually are. It's the same principle at work in telescopes and binoculars. The image is recorded at full resolution and the image looks (roughly) as good as it does without zoom applied. Optical zoom is found on basically all traditional-looking camcorders, and usually works to at least 10x the normal focal length. Some standard-def camcorder even extend out to 60x.
Digital zoom uses software to create the illusion that you're closer to a subject. It doesn’t require any space for the lens to move, so it's the only type of zoom on small pocket camcorders, like the Flip series and Kodak Z series (though it's also available on more traditional camcorders at levels up to an absurd 2000x and beyond). The simplest form of digital zoom simply crops the image that the sensor sees and enlarges the pixels to make it seem like you’ve zoomed in on your subject. A better digital zoom might use an algorithm to “fill in the blanks.” But either way, it basically cuts the image resolution in half with every zoom factor, so the image quality becomes grainy and painfully bad fairly quickly (the picture at right used 2.3x digital zoom, with visible deterioration -- click for a full-res picture).
Which One Wins?
Optical zoom is clearly the better option, but it does have a few drawbacks. As mentioned, in order to move the lens elements back and forth, the camera has to have room to move them. This is a challenge for anything pocket-sized. The mechanism can also be noisy if you zoom in and out while shooting, and on smaller camcorders (and especially digital still cameras with video capability) the microphone is usually close enough to the zoom motor to pick up the “whirring” noise. Cameras that use glass lens elements also get very heavy as the zoom factor increases. Finally, cameras with optical zoom tend to be more expensive than their digital zoom-only cousins because of the extra mechanics involved. If you’re willing to put up with those small obstacles, (and most of you should be), you'll be rewarded with much, much better image quality.
If you have no choice but to use digital zoom, you might want to buy a higher-end editing program. Avoid using digital zoom while shooting, and use the editing software to crop the image after the fact. It will usually do a better job of filling in those blanks than your camera’s on-board digital zoom.