The Canon Rebel XSi was announced today, bringing Canon 40D features over to the Rebel line, such as a bigger LCD, highlight priority, 14-bit A/D, and live view. It also ups the megapixel count to 12.2 and switches over to SD/SDHC media. The latter seems a good prosumer move, given how much cheaper SD media is nowadays.
But I'm not sure I grok Canon's SLR strategy. This is the second time I can recall that Canon has one-upped their professional line. Six months after Canon 30D debuted at PMA, they announced the Rebel XTi. The 30D premium over the Rebel line became harder to justify when the XTi added automatic sensor cleaning, a superior megapixel count, and an equivalent autofocus sensor. Now, six months after the release of the Canon 40D, they've released the XSi, which again puts the Rebel line in the lead with megapixel count and matches some of the 40Ds biggest improvements: highlight priority and live view. The 40Ds advantages are mostly whittled down to build quality, viewfinder brightness, and +3 fps.
I understand the need to stagger their new products into the marketplace to keep the buzz alive; what I don't get is why they choose to let the Rebel line be the leader with new features and more megapixels. Perhaps they figure that consumers and semi-pros will stay in their camps and in my case they're right, but a 50% price premium hurts, Canon, it hurts. Or perhaps they are secretly using the Rebel line to debug the newer sensors so that they're rock-solid by the time they land them in the next xxD model :).