I ran into the same problem on the 2nd day of a 25 day vacation! Had to buy a new camera in a hurry. My Finepix S1 was just over 2 years old and out of warranty so when I got home I decided I had nothing to loose. Started playing around trying to get the lens re-alligned and a bit of rubber was exposed between the lens and the housing. I pulled on it (what more could you do?) and eventually, very carefully removed a rubber ring, some type of gasket (it broke in two). The lens is much looser than it was but the camera now functions. Next step is to see how much it would cost to get this gasket replaced, but for now I've got a 2nd camera.