The higher ISO setting comes through amplification of the signal, and the more you amplify the more noise you get, meaning the camera's processor has to use Noise Reduction software to smooth things out. Together noise, and noise reduction, have an increasingly detrimental effect on image quality (sharpness and colour) as ISO increases. So what is all this noise then?
Noise (think of it as 'interference') is present in all
electrical circuits, and manifests itself in digital cameras
as spots and speckles of false colour, especially in shadow
areas. Just as film grain becomes more noticeable the higher
the ISO, so noise becomes more and more of a problem as you
crank up the ISO setting of the sensor. It's much less of a
problem with a DSLR (like the FinePix S3 Pro), which has a
much larger sensor (more surface area means more
sensitivity), and for cameras with the latest version of the
Super CCD sensor (such as the FinePix F10and newer models), which have a
unique design that allows sensitivities of up to ISO 1600
without a significant increase in noise.
ISO settings
Most digital cameras have ISO settings from around 50 or 80 to 400, with a few going up as high as ISO 1600. ISO 200 is twice as sensitive as ISO 100, which in turn is twice as sensitive as ISO 50, and so on. What this means is that if a certain shot needs a 1/25th second exposure at ISO 50, it'll need a 1/50th at ISO 100 and 1/200th at ISO 400. The difference between 1/25th and 1/200th second can be the difference between camera shake and a perfectly sharp picture, which is why the ability to increase ISO is so important!
Using ISO
The default setting on most cameras is
auto ISO,
where the camera sets the ISO according to the brightness of
the scene. Low ISO settings (which offer the very best
quality) are used wherever possible, with the sensitivity
only increasing where there would otherwise be a risk of
camera shake. This is fine for most everyday 'point and
shoot' photography. You can, however, change the ISO setting
manually, and it's worth getting to grips with this so you,
rather than the camera, can make the decision.