Sony has announced the third iteration of its RX100 camera, and the new point-and-shoot looks like it could be one of best compact cameras on the market. It features everything that was great about previous RX100 cameras, plus a faster zoom lens, Sony's speedy BIONZ X image processor, and a built-in pop-up electronic viewfinder.

When Sony launched the first RX100 in 2012, it made us rethink what compact zoom lens cameras could do. Its large sensor, combined with a versatile zoom, was capable of producing outstanding image quality, in a very portable package. Then with its sequel, the RX100 II (M2), Sony improved the camera with the addition of features like Wi-Fi connectivity and a tilting screen.

The new RX100 III (M3) uses a 20.1 megapixel one-inch-type (13.2 x 8.8 mm) CMOS sensor, similar to the 20.2 megapixel one in its predecessor. However, it's now paired with a BIONZ X image processor, as used in the high-end Sony A7. This means the camera can produce quality images, with natural reproduction of fine textures, in a variety of lighting conditions. It has an ISO range of 125 to 12,800, and features speed priority shooting at 10 fps.

While the new processor also helps ensure swifter focus tracking and detection, it's slightly disappointing that the autofocus system is still contrast detection-based rather than a speedier hybrid set-up. That said, a new eye autofocus function, which detects and focuses on a subjects eye, is a welcome addition, like it was in the recently announced Sony A77 II.

The biggest improvement to the RX100 III is probably its new Zeiss Vario-Sonnar T 24-70-mm equivalent F1.8-F2.8 zoom lens. While not reaching quite as far on the zoom end (the RX100 II went to 100-mm equivalent) it goes wider, and is considerably faster. A maximum aperture of F2.8 on the telephoto end of the zoom means better light-gathering power and the ability to blur out the background of an image.

There's also the addition of a retractable OLED electronic viewfinder which rises from the top plate next to a pop-up flash. With 1,440,000 dots, it gives users a viable alternative to composing shots on the 3-in rear LCD monitor, which has 1,228,800 dots. That said, the monitor now tilts 180-degrees, which could come in handy for selfies.

There's the option to shoot Full HD 1080p video at 60/50 fps, though this can now be done in AVCHD or XAVC S format at up to 50 Mbps. Slow motion fans will be pleased to know the RX100 III can also shoot 720p footage at 100 fps. Clean HDMI output means Full HD footage can be stored to an external recorder.

While it makes a great point-and-shoot, manual controls have also been upgraded on the RX100 III, and functions can be assigned to a new custom button or control wheel. Despite the extra features which have been packed into the aluminum camera, it still measures a pocketable 101.6 x 58.1 x 41.0 mm (4 x 2.3 x 1.6 inches) and weighs a travel-friendly 290g (10.2 oz).

Wi-Fi and NFC connectivity means it's easy to share images or video instantly, and there's now the option to use Sony's PlayMemories Camera Apps.

The Sony RX100 III will be available in June and will set you back about US$800.

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