I have two IS lenses, the 17-55 and the 70-200. Here are my observations on IS:
1. I can't stop people with anything slower than 1/60th of a second, when it comes to my kids. At a wedding I did last summer, the bride and groom were more static so 1/30th seemed fine. The rule of thumb is that you can't handhold below 1/Focal Length for a lens. Using 35mm equivalents, I should be using 1/60th or faster for a 40mm lens. Therefore, IS is useless to me for focal lengths below 40mm (for people shots). In reality, I never use IS with my 17-55 for moving people shots. Works great for sleeping babies, though . IS really shines with a longer lens like the 70-200. I can shoot at 200mm with 1/60th of a second and get sharp shots.
2. IS is great when you want to get a long ambient exposure combined with flash. I took some shots at Halloween where my family was lit by flash, with great ambient lit buildings in the background. I use this a lot with the 17-55.
3. Depth of field can be extended for landscapes. When shooting with a 20mm lens at 1/30 f/4, you could go down to f/8 and drop the shutter down to 1/8s. This would otherwise be too slow to hold and require a tripod.
4. Canon makes the claim that viewing through an IS lens is better than sensor stabilization because you can see the effect. I would agree on a long lens. I can compose better with a stable viewfinder image. With the wider lens it isn't a significant factor. In a perfect world I would support sensor stabilization for use will all lenses, but probably put the IS into long lenses. This would minimize lens cost for the photographer.
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