It happened quietly, but Canon, Konica-Minolta, Fujifilm, and Sony, have all published service advisories admitting that certain models of their digital cameras and digital camcorders are defective. Signs that this could be happening are blurry images and unnatural colors on the LCD display when the camera is in camera mode (example pictured above). This affects cameras that were released in the past two years.
Apparently the culprit are Sony CCD sensors that were packaged in epoxy, which is a lower-cost alternative to more expensive ceramic packaging. The epoxy packaging may lead to moisture and the defects don't show up until years later due to heat and humidity. Word is that Sony will be paying for the repairs on all the cameras regardless of manufacturer — which is certainly a credit to them, but considering the sheer number of cameras this defect affects, Sony could potentially be losing a bunch of money over this.
Defective Digital Cameras: Sony, Fuji, Konica Minolta and Canon [Retrothing]
Digital Camera Failures [Slashdot]