terminology - What does "expanded ISO" mean?

The ISO specification for the Canon EOS 7D reads as follows:

High ISO For handheld shooting in low light, the EOS 7D offers ISO speeds of up to 6400. Expandable to ISO 12800, for low light scenes where using flash is undesirable.

Why is it phrased this way? Is there something extra that is needed in order to "expand" ISO to 12800?

If not, then presumably the camera is capable of 12800 out of the box — so why not just list that as the max ISO speed?

Similarly, the Nikon D5100 uses Hi1 and Hi2 instead of numeric ISO settings above 6400. If these are "real" ISO settings, why not just call them ISO 6400 and ISO 12800?

What about cameras which have an expanded ISO range on the low side? For example, an expanded ISO setting may allow a choice of 50 rather than 100. Generally,the standard high ISO is very noisy, with the expanded ISO even more so. Are these lower ISOs less noisy than the "base"?

How do these expanded ISOs affect image quality on either side? Is it better to avoid them and do the equivalent processing with RAW files later, or is there an advantage to using these settings in-camera?

Answer

There are two reasons why an ISO is not made part of the 'normal' range:

1. 
   

   It is considered a non-trivial drop in quality and you do not want users complaining about its performance. In other words, if the quality difference between ISO 12800 and 6400 is stronger than the one from 3200 to 6400. Note that there may be more changes than simply more noise, colors can be affected as well.

   
   


2. 
   

   The camera meters and exposes for the said ISO, say 12800, but the results do not strictly comply with the ISO standard. When that happens, you will notice that the ISO is NOT stored in the EXIF of the image. This usually happens because of a drop in dynamic-range at the expanded setting.