It's been years since Canon dominated the high-end compact market. Back then — before companies like Fujifilm and Sony flooded the market with excellent options near or under $1,000, and shooting with your phone wasn't really an option — Canon's flagship G series of cameras reigned supreme. If you wanted a camera with full manual controls that you could squeeze into a pocket, it was nearly the only option. Today, Canon is adding to that that lineup by introducing the $999 Powershot G3 X.

The 20.2MP G3 X has all the features you'd expect from a camera in this price range: Wi-Fi, NFC, water resistance, a 3.2-inch touch-enabled articulating LCD screen, and the ability to shoot 1080p HD video at 60fps. It even has a few you wouldn't expect, like five-axis image stabilization and audio jacks for headphones and an external microphone.

But in certain lights, the more expensive G3 X looks like a step back from its predecessors. The 1.5-inch CMOS sensor found in the G1 X (2012) and G1 X Mark II (2014) is gone, and in its place on the G3 X is merely a 1-inch sensor. The new camera will use Canon's DIGIC 6 image processor, which is good at helping smaller sensors in tough situations (like low light), but there will likely be an unavoidable tradeoff in image quality.

The smaller sensor did allow Canon to pack tons more focal length in the new camera, as the G3 X features 25X optical zoom (for the equivalent of a 24-600mm lens). Gaudy optical zoom capability is a weapon of choice for traditional camera companies trying to sell high-end compact cameras. Both Canon and Nikon, have equipped its lower-end cameras with smaller sensors that allow for optical zooms of 65x and even 83x.

The harsh truth for these companies is people are extremely comfortable shooting photos with their phones, and better mirrorless cameras with larger sensors and similar features are dropping in price. Take the PowerShot G3 X's closest competitors, for example. Last week Sony announced the RX10 II, which can shoot super slow motion and 4K video, and has a consistent aperture of f2.8, and the RX100 Mark IV, an extremely capable version of its most compact camera. Canon will have the cost edge on the $1,300 RX10 II, but not the $1,000 RX100 Mark IV.

That leaves the G3 X in a murky spot. The G3 X has better zoom than the brand new RX100 Mark IV, but the Sony is far more compact. And while the G3 X is cheaper than Sony’s similar-looking RX10 II, the tradeoffs you have to make in capabilities and image quality may not be worth the money you save.

The PowerShot G3 X's most direct competition might come from inside Canon's own factories. The company's G1 X Mark II is still for sale at a much cheaper price that's paired with a bigger sensor. That might make it worth whatever tradeoffs you can find deep in the list of its specs.