In reply to The Lemming:
The pictures of my phone (galaxy S2) look good at phone-size, but that's it.
Also, there's no control whatsoever, and there is substantial lag between tapping the button and taking the picture. Moreover, taking a picture by pressing on a touch-screen is just really annoying.
My compact takes much, much better pictures then my phone, not in the last place because I'm able to control it properly.
I use my camera to take pictures of places where I can't see, and it does that quite well...