It's the Exilim from Casio. You can't get more compact than this and there's even an internal flash and onboard 12MB memory! A 2MP version has also been announced....
check out a review here:
Not only is the EX-S1 small, it is also very fast. It is ready to take the first shot faster than you can press the power button and bring it up to your eye. I'd say it takes about one second to power up and has a shot to shot time of less than two seconds when using the flash, even faster without it. Unlike most digicams the EX-S1 has almost zero shutter lag time thanks to the fixed-focus lens. This means you won't miss any of those special pictures because the camera was still trying to focus.