Of course, a digital camera is always great for taking family photographs. Millions of people do that every day. However, for the genealogist, a camera can serve as a multi-purpose tool. It's even better than a Swiss Army Knife!
My favorite use of a camera is for snapping pictures in a cemetery. It serves as an automated notebook, recording the transcriptions. However, even better, the resulting images serve as source citations for the records you keep. I cannot think of a better source citation than an image of the words that were etched in stone. Of course, you will want to record the date, too. This is easy to do with most digital cameras that will optionally record the date and time on every picture taken.
You will also want to record the name and location of the cemetery. I usually take a picture of a sign near the entrance or anything else that identifies the cemetery. A few of today's cameras will even record the exact longitude and latitude where the camera was located when the shutter was snapped. That is called "geotagging." The geotagging feature lets users record their photos with geographical data (including but not limited to, date, time, latitude and longitude coordinates, altitude, bearing, and place names).
The built-in automatic geotagging feature is typically found only in expensive cameras, but there are a few interesting exceptions. Once such exception is the two-megapixel camera built into the Apple iPhone 3Gs. I wouldn't consider two megapixels to be high enough resolution for family portraits, but it is great for taking pictures of tombstones in a cemetery. Of course, the iPhone also has many other uses besides being a camera.
Another great use for a digital camera is making images of documents. Let’s say you visit a cousin and find that she has the original marriage certificate of your great-grandparents. The best thing to do is to scan that document; but, when a scanner is not available, grab your camera and take a picture. You will have a copy of the document, and it also makes a great source citation. Why transcribe a document when you can write, "Here is an image of the original certificate?"
I have also had success taking pictures of documents with the iPhone. Use lots of light as the iPhone does not have a built-in flash.
Digital cameras come in two versions: Single Lens Reflex (SLR) and "point and shoot." Cell phone cameras are really "point and shoot" cameras packaged inside a cell phone. The most obvious difference between the two is that a "point and shoot" camera has a single, built-in lens while a digital SLR is one with separate, interchangeable lenses. When compared to SLRs, the "point and shoot" cameras are generally cheaper, more compact (easier to travel with), and much lighter. Features vary widely, but most "point and shoot" cameras use an LCD screen for image composing, making it easier to frame and view the work in close quarters. Many SLRs can only use the optical viewfinder for image composition although there are some exceptions.
The SLRs typically have the best lenses, allowing for a wider variety of telephoto and close-up shots, and are especially good for use in low light situations. (The Apple iPhone is very poor when used in low lighting.) However, the SLRs also tend to be more complex to use and require some study of photography techniques. Most SLRs do have a "point and shoot" mode that emulates the operation of the cheaper cameras but also benefits from the better lenses and variable shutter speeds.
There are numerous reasons to go digital, but the most compelling from a genealogical point of view is the ability to cheaply copy old photos and documents at very high quality and make multiple copies of these images to share with relatives. You can probably find dozens of other uses for a digital camera: taking pictures of the old family homestead, taking pictures of nearly everything found on a research trip, photographing your aunt's photo or letter collection, photographing cemeteries, making copies of documents and pages of books at libraries and archives, or even snapping pictures at a genealogy conference.
This Christmas, you might ask for a digital camera. Better, yet, print this article on your computer and then "accidentally" leave it in a visible place where family members are sure to see it.