The company is expected to announce the move later on Wednesday. Forman, who was executive chairman at location-based service app Where until it was acquired by eBay earlier this year, has also worked at EarthLink, Yahoo, Time Warner (and AllThingsD owner Dow Jones).

Though not well known in its own right, Appia powers app stores for some big names, including Opera, Samsung, T-Mobile, AT&T and Verizon Wireless. Appia, which was formerly known as PocketGear, raised $10 million in venture funding back in March.

But it didn’t say how it would overcome technology barriers, such as finding a way for a smartphone to connect to the register without requiring a consumer to get a new phone with a near-field communication chip, or without making the retailer buy fancy new hardware.

Today, it announced an acquisition that may be one way it could solve this costly dilemma.

On the PayPal blog today, the company announced that PayPal has acquired Fig Card, which has developed a way for merchants to accept mobile payments by using a low-cost USB device that plugs into the cash register or point-of-sale terminal. Customers will have to install the Fig app on their smartphones.

“We loved their approach to point-of-sale, particularly because it was driven by the same vision that we have at PayPal–in the future, transactions can be as smart as a computer and not as dumb as paper. We won’t need our physical wallets. We’ll be able to pay any way we want, from any device, anywhere in the world with both flexibility and privacy,” said Peter Chu, PayPal Mobile’s senior director.

Fig Card was founded in early 2010 by Hasty Granbery and Max Metral, who will be joining the PayPal team. On the company’s Web site, it admits that the obvious challenge for the company is its small size, but that it was moving forward with trials among a handful of merchants in Boston’s south end.

Prior to founding Fig, Metral was co-founder and CTO of Firefly, which was bought by Microsoft. At Microsoft, he developed Microsoft Passport, one of the first single-sign-on systems. He then co-founded PeoplePC, where he met Granbery. PeoplePC was purchased by Earthlink.

If you spend any time with eBay at all, it’s clear that a lot of its emphasis is on PayPal. On Wednesday, it noted the division’s contribution to revenue growth in the first quarter and said in the first three months of the year, PayPal added one million accounts for the sixth quarter in a row. It now expects to achieve 100 million active accounts by the end of next quarter.

Additionally, PayPal was just shy of hitting its first billion-dollar quarter, and now represents 39 percent of the company’s overall revenues. To support its goals further, eBay recently acquired WHERE, a location-based mobile services and ad network.

While PayPal is one of the longest-standing online payment providers, it faces steep competition in the digital payment space from both incumbent providers and new entrants.

For instance, the Fig technology sounds similar to what Square is trying to accomplish by passing out dongles that can enable virtually any smartphone to accept payments. Square announced this week that it received an investment by Visa. Other giants like Google are getting into the space, and additionally, Facebook is becoming a big player in the space with the roll-out of Credits, a system used today to pay for virtual goods, digital items, and, increasingly, physical goods, like daily deals.

Starting Friday, Twitter users began to post updates about service outages. Alex Mendez tweeted “33:40 minutes on the cellphone dealing with TW / earthlink. UGH,” and Diane Fischler wrote, “Not getting email messages again. Woke up to about 60 left over from yesterday’s Earthlink outage, now seems to be down again. Who else?”

On Saturday and Sunday, EarthLink users continued to complain about their lack of service. Jim Rattray wrote: “#Earthlink email has been down for 24+ hours. ‘We’re aware and working on it.’ Not good enough,” while romeneskoblogs said, “I haven’t received Earthlink email since Friday night. Customer service rep (in India) said could be 72 hours b4 restored.”

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Microsoft blamed phishing, in which cybercriminals try to trick consumers into revealing personal information through fraudulent emails, for a list of Hotmail account passwords that appeared online. The company recommended Hotmail customers change their passwords and said it’s helping phishing victims fix compromised accounts.

But security firms and the BBC said Tuesday that the attack extended to other services, including those run by Google (GOOG) and Yahoo as well as AOL, EarthLink (ELNK) and Comcast (CMCSA).

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This morning, Earthlink posted Q4 revenues of $216.1 million, right in line with the Street at $216.2 million. But the dial-up Internet access provider posted profits for the quarter of 25 cents a share, falling short of the Street by 13 cents. Note, however, that results include a $78.7 million noncash impairment charge, partially offset by a $56.1 million tax benefit. Revenues dropped 23.4 percent from a year ago.

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One of the more interesting quarterly earnings calls to watch carefully is going to be Time Warner’s in two weeks.

Why? Well, in the digital space, it’s because of its long-suffering online unit AOL and what results it will show.

More importantly, though, is what AOL’s performance will mean for the attempts Time Warner CEO Jeff Bewkes has tirelessly been making to trade it away.

The media giant will announce its third-quarter results Nov. 5 at 10:30 a.m., Eastern time.

Last quarter’s results were not too promising, to say the least, and it was due in large part because AOL dragged Time Warner (TWX) down badly.

There were declines in both revenue and operating income at AOL, which were luckily offset by strength in Time Warner’s cable television and movie studio divisions.

AOL saw its revenue drop to $1.1 billion, a 16 percent dip, with operating income off 36 percent, to $230 million. There were more subscribers lost from its slowly dying dial-up Internet service–incredibly AOL has lost 14 million in the last three years.

And that was planned, after AOL’s home page and email went free. What was not so figured out was how badly its business would be struggling to make a better margins from advertising, even as its access business dwindled.

Time Warner began to separate the two sides of AOL, an effort still in process, in order to sell them both off.

John Malone of Liberty Media (LINTA) said this summer that he would make a swap for the cash-generating access business, and there is also Earthlink (ELNK) and United Online (UNTD) in that mix.

As to the rest of the AOL business–still an advertising and content behemoth, despite its woeful descent over the years in Time Warner’s care–Bewkes has been trying to pawn it off for years now in a variety of deal-chatting with companies like News Corp. (NWS) and Microsoft (MSFT). (News Corp. is the owner of Dow Jones and this Web site.)

And, principally these days, Yahoo, with which Time Warner has been locked in endless discussions about a possible merger for months.

But, while every week the AOL side leaks the breathless news that the union is just about to be struck, that has yet to come to pass.

Still, even this past week, various execs from both companies have been meeting, discussing what the new Yahoo-AOL combo might look like.

The deal, on some level, makes sense, putting together the top graphical ad businesses online and uniting powerful content assets, as well as dominant online communications offerings.

The pair also share a strong relationship with search powerhouse Google (GOOG)–it owns five percent of AOL and does its search, and is trying to launch a controversial search ad outsourcing deal with Yahoo.

But a possible merger of AOL and Yahoo also has a strong stink of desperation about it–of two struggling companies trying to stand together so they won’t fall apart.

Of the pair, despite its weak results last week and endless turmoil over the last year, Yahoo (YHOO) is decidedly the stronger business, with obvious prospects of revival.

But its moribund stock, now hovering in the $12 a share range, has put a damper on talks, given how much Yahoo would have to give up to get AOL.

For its part, Time Warner is foolishly holding onto an $8 to $10 billion price tag from days long gone by. And if results at AOL continue on the trajectory they are on–how could they not, given the weak economic situation?–Bewkes might want to get a little more flexible.

Because things are only going to get worse. So, if a Yahoo-AOL deal is to be struck, sooner or later, for Time Warner, it had better be sooner.

On one of my many trips to Los Angeles (what can I say? I like to hang where LoRo* hangs), I dropped in to see Nick Grouf of Spot Runner.

As many might know, Spot Runner is an online-offline ad agency play that has gotten big funding and even bigger hype of late.

We’ll see how that goes. But Spot Runner actually seems to be tackling an underserved (and unexciting) market of local and national clients in need of cheap online ad solutions married to more traditional marketing venues to boost revenue.

Here’s my video interview with Grouf at Spot Runner’s offices on Wilshire Boulevard:

I met Grouf many years ago when he–along with Spot Runner partner David Waxman–founded PeoplePC and Firefly Networks.

Grouf sold the struggling PeoplePC–which hawked computers bundled with an online service–to Earthlink (ELNK) in 2002 for $10 million and assumption of $35 million in liabilities, in a Web 1.0 meltdown deal that followed a disastrous IPO.

He then started working for the Presidential campaign of Sen. John Kerry, helping figure out how to best and most cheaply place critical television ads–crunching all sorts of data about lots and lots of neighborhoods and towns and cities nationwide to figure it out.

What Grouf figured out, though, was that a system for doing so was nonexistent.

That experience turned into Spot Runner, which is essentially a do-it-yourself model that tries to iron out inefficiencies in the buying and selling of advertising and bridge the gap between the traditional and online ad markets.

Offering cheap ad templates, clients can make and place low-cost television and radio ads for small and national businesses, as well as political campaigns, and get analytics about the impact of the ads. Some ads cost as low as $500.

Spot Runner got a pile of cash to try to do that better, recently nabbing $51 million in funding to add to the $60 million already raised.

Investors include international media giants Daily Mail and General Trust (DMGT.L) and Grupo Televisa (TV), investment company Legg Mason Capital Management (LM) and luxury conglomerate Groupe Arnault/LVMH (MC.PA).

Spot Runner’s previous investors are Allen & Company, Battery Ventures, Comerica Bank (CMA), Lachlan Murdoch, Vivi Nevo, Capital Research and Management, CBS (CBS), Index Ventures, Interpublic Group (IPG), Tudor Investment Corporation and WPP.

Its board includes Index’s Danny Rimer and former AOL exec Bob Pittman.

All that money has given Spot Runner an eye-popping valuation upwards of $500 million.

This is its biggest burden, I think, setting expectations very high for what is still a little start-up.

And while there are rumors of both Microsoft and Google, as well as Comcast, being interested in acquiring the company, Grouf dismisses the speculation.

He says Spot Runner is more intent on using the money raised to buy companies and improve its offerings.

For example, it recently bought Weblistic, a local search listings creator, and hired former Microsoft exec Joanne Bradford.

Bradford, who was a VP and chief media officer of MSN Media Network, is executive vice president of National Marketing Services at Spot Runner, focusing on getting national advertisers to also think small and targeted.

Who knows whether the company will be able to overcome its hype, but time (and money) will tell.

(*And a free D6 bag for anyone who correctly identifies who I am referring to here, either by sending in a comment or an email to me at kara@allthingsd.com.)

The provider of dial-up Internet access services posted Q2 revenue of $245.6 million, right in line with the Street. But profits of 48 cents a share beat the Street consensus of 36 cents by 12 cents. The company said it finished the quarter with $441.6 million in cash, up $121.6 million from one quarter earlier.

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“Additional steps” in this case is a euphemism for “more layoffs to come,” as the company will also “substantially reduce its presence” in Atlanta and Pasadena, Calif.

What this all means for EarthLink’s already faltering municipal Wi-Fi effort remains to be seen. As Om Malik notes, its future is, at best, dubious. EarthLink’s “MuniFi experiment hasn’t gone according to plan, even though the company was successful in signing up quite a few cities for MuniFi networks,” Malik writes. “But EarthLink’s San Francisco effort, for example, is mired in a political morass. The Arlington (Va.) and St. Petersburg (Fla.) MuniFi networks are currently on hold. We are being told that Don Berryman, who used to run the MuniFi business, left the company three weeks ago. More importantly, the company is carrying the costs of Helio, an expensive MVNO effort. Helio, after starting out with $440 million in backing from SK Telecom and EarthLink, recently raised another $200 million ($100 million each from the two partners.) Will EarthLink follow through with this (and future) investments, remains to be seen. Helio is estimated have $40 million in operating costs, not an easy pill to swallow considering that the company continues to lose subscribers in its core ISP business. EarthLink is between the rock and a hard place: If it gets rid of those money-losing businesses, then it is left with a business whose growth engine is negative.”

This agreement catapults San Francisco into a leadership position in wireless technology: the network ensures universal, affordable wireless broadband access for all San Franciscans, especially low-income and disadvantaged residents; and through the mayor’s digital divide program, children and students will have the digital tools to ensure that they have access to everything that the Internet has to offer the growing minds of the city’s promising future.”

–- Donald Berryman, executive vice president of EarthLink, Jan. 5, 2007

Establishing a citywide wireless network in San Francisco may well prove too daunting a job for even Google. The company’s partnership with EarthLink to provide free wireless Internet access in the city may be in danger of collapse, now that the ISP has announced it will re-examine its municipal-wireless network plans..

During EarthLink’s second-quarter conference call last week, newly appointed President and CEO Rolla Huff said the company’s approach to the muni Wi-Fi market isn’t viable. “The Wi-Fi business as currently constituted will not provide an acceptable return,” Huff said. “We’re actively exploring ways to scale this business more economically. We’re going to look for municipal government to step up and become a meaningful anchor tenant on completion of a build. That would go a long way in our being able to get an acceptable return on this investment. Until we’re convinced that we can build new networks and get an acceptable return, we will delay any further new build-outs.”

If that is Huff’s position, he’s not going to take kindly the city’s proposed adjustments to its contract with EarthLink, which includes increasing the speed of the service and shortening the length of the term for which the company would provide it to eight years from 16–neither of which will do much to increase its ROI.

It seems likely, then, that EarthLink’s involvement in San Francisco’s municipal wireless efforts is finally drawing to a close–nearly three years after it was first announced. “The existing contract with EarthLink was already unlikely to move forward due to EarthLink’s business-model changes,” Glenn Fleishman explains at Wi-Fi Networking News. “The emendations to the contract requested by the supervisors’ head ensure that EarthLink will ultimately back out. I give it another four to six weeks before the whole deal is over. Which means that SF has to return to the drawing board.”

What this means for the other 215 cities and counties considering municipal Wi-Fi deployments remains to be seen …

The White Spaces Coalition, an alliance of companies developing a new wireless broadband service that taps into unused and unlicensed portions of the television spectrum known as white spaces, has
submitted another prototype device to the FCC for testing. Like its predecessor, this device (developed by Philips) is designed to demonstrate that white-space technology won’t muck up the airwaves for the telecom and cable companies who will almost certainly try to sandbag it on those very questionable grounds. “The telephone companies are terrified they’ll lose 40% of their wireless minutes, because you’ll be able to connect from work or home and bypass their wireless networks,” J.H. Snider, research director of the Wireless Future Program at the New America Foundation told MarketWatch recently. Which is funny, because the incumbent telecoms could have developed their own white-space technology if they’d wanted, they just didn’t bother because white spaces can’t be licensed in contiguous blocks, and apparently it’s far easier to add ridiculous modifiers to old technologies (Comcast PowerBoost!) than it is to develop new ones. Innovating is such a hassle.

Of course, now that the WSC–whose membership includes Google, Dell, EarthLink, H-P, Intel, Microsoft and Philips–is making its presence felt in Washington, it’s a different story. Anyway … the FCC plans to conclude its testing of the WSC’s white-space devices in July. If all goes as planned, and the incumbent telecoms don’t manage to undermine the effort, white-space broadband service could begin in the U.S. in February 2009.

Here are a few questions about computers I’ve received recently from people like you, and my answers. I have edited and restated the questions a bit, for readability. This week my mailbox contained questions about antispam systems, programs to transfer files from PC to iPod and the VoiceOver system on Macs.

What is the best antispam system out there today? Spam filters don’t seem to work well for me.

Spammers change tactics so frequently that even the best, most adaptive filtering systems have a tough time coping. In my view, the strongest antispam approach isn’t filtering at all, but is called a challenge-response system.

With this approach, you set up a “white list” of approved senders — it could be your address book or some other list — and every email you get from anyone who isn’t on the list gets challenged. What this means is that the incoming email is intercepted and that the sender receives a message asking him or her to enter a constantly changing code number to prove that the message originated with a human.

The computer programs that blast out millions of spam messages usually can’t type in such a number, because it is presented as a graphic and in a wavy or faint typeface, and computers typically can’t copy and paste such graphical numerals automatically.

Messages that pass the challenge are delivered to you. Those that don’t, including nearly all spam, aren’t. Examples of such services are ChoiceMail, at digiportal.com; and EarthLink antispam, at earthlink.net.

The downside of this approach is that legitimate senders not on your list may find it a hassle to fill out the challenge and give up on emailing you. This is a problem mainly for business users who get desired emails from people they don’t know, such as prospective customers.

I would like to transfer files onto a new PC from my iPod. Are there any programs that do this?

There are multiple inexpensive programs designed to do exactly that. Some work with Windows computers, some with Apple Macintosh computers, and some have versions for both. One that I have found reliable is a British-made program called Music Rescue (formerly known as PodUtil) and can be found at www.kennettnet.co.uk/musicrescue/. It comes in both Windows and Mac versions and costs £10, or about $19.40.

Ever since I changed batteries 10 days ago in the wireless keyboard for my Apple iBook G4, there has been a voice that seems to be issuing commands to the computer, or at least is speaking what is happening when I do things. I must have done something wrong. How can I stop it?

I assume that, while fumbling with the keyboard to change the batteries, you accidentally turned on a feature called VoiceOver in Apple’s Mac OS X operating system that speaks aloud various alerts and actions. This feature is intended for certain disabled users who have difficulty seeing the screen or otherwise could benefit from spoken feedback when navigating their computer’s interface.

To turn VoiceOver off, you can just press the command (Apple) key and the F5 key simultaneously, though on a laptop such as yours you may have to also hold down the Function (fn) key at the same time. Or, you can launch System Preferences, select Universal Access, and then select the tab labeled “Seeing” and click the Off button under VoiceOver.

* * *

Because of the volume of e-mail I receive, I can’t routinely answer individual questions by e-mail, or consult on individual problems or purchasing decisions. I read all questions I receive and select three each week to answer in the column.

• Write to Walter S. Mossberg at mossberg@wsj.com

For the analog grandfather who wishes he could see the digital vacation photos that everyone else in the family emails to one another, or the beloved aunt who just can’t or won’t get an email address, one company thinks it has a solution: turn emails and digital photos into paper documents, automatically, without a computer.

The Presto service offers a way for users to receive emails without having a computer: by printing them out. www.presto.com.

This week, we tested a new service called Presto that works with a special Hewlett-Packard printer called the Printing Mailbox. After setup, the user is assigned a Presto.com email address to which friends and family send text emails or photos. But the owner of this gadget doesn’t need a computer, and never has to go online to retrieve emails. The Printing Mailbox automatically and periodically dials into the Internet using a regular phone line, retrieves all messages sent to it — including photos — and prints them out.

Hewlett-Packard Co.’s Printing Mailbox costs $150. The accompanying Presto service (www.presto.com) from Presto Services Inc. costs about $10 monthly or $100 annually. The printer doesn’t work without Presto, making it useless if you stop the service.

The Presto plan includes optional free subscriptions to various articles and puzzles, which print out in addition to any emails that you receive. You set up and manage the account via a Web site accessed from a computer, a task intended to be performed on the owner’s behalf by a friend or relative.

Overall, we liked Presto and the H-P Printing Mailbox. It has some room for improvement, but it does an excellent job of emphasizing simplicity, and providing a way for the computer-phobic to feel part of the online community.

But the system has one major drawback: It’s a one-way street. The owner of the device can receive emails but can’t email back. The printer has no keyboard, and can’t scan in typed or written notes that might be converted into emails and sent to others.

The idea of bringing email to those without computers has been tried before. For years, EarthLink sold a simple two-way device called the MailStation. This small tabletop gadget included a bare-bones screen and keyboard and also used a dial-up connection to automatically receive and send email. But EarthLink stopped making the MailStation.

To get started with Presto, we took 10 minutes setting up the Presto account, doing so as if the Printing Mailbox were going to be used by someone else. This process designated us as the account managers and asked us to choose a username and password that let us log in to the account from any computer. Another step suggests setting up dial-in and printing schedules; we chose 9 a.m., 3 p.m. and 9 p.m. Print size can be preselected as medium, large or larger — a feature that helps older users with poor eyesight.

We entered our credit-card information and created an email address. This address will receive messages only from those whose names and emails are added to a list so as to prevent spam or unwanted email.

Finally, we scanned a list of optional subscriptions before choosing a few, including a weekly health column; a daily Sudoku puzzle; and a Dave Barry humor column that comes out each Sunday. Other optional categories included food and recipes, arts and entertainment and travel.

We unpacked our printer, plugged in its power and phone cords, inserted its included ink cartridge and loaded 50 sheets (the maximum amount) of paper. We never had to turn it on or off; the printer automatically dialed into Presto the first time its phone cord was connected. Unlike a fax machine that audibly dials, the Printing Mailbox works silently until it churns out a message, pleasantly chiming to indicate new messages.

Even though we receive many emails on a daily basis, the sound of the Presto chimes had us up and dashing to the printer to see which friend or family member had sent us something and what it was. The Printing Mailbox prints embedded or attached photos but not attached Microsoft Word documents — a feature Presto may add in the future. The photos looked good, even on basic white paper. Users could insert photo paper for printing, as long as it was the same 8½” by 11″ size.

By default, an attractive pale green border printed around each personal email, with the subject line prominently centered at the top of the page. The Presto account manager can set the style for all printouts, such as Birthday or Wedding. Or anyone sending email to a Presto user can go to Presto.com to select an email style. Each style has a designated code that, when used in the subject line, produces the printed template for the receiver. We tried this by labeling a subject line as “Hi Walt [Presto YellowWave]” and the printout had a pale yellow design on its top and right edges.

The printer itself is handsome with a shiny white patina and the cartridge and loaded paper hidden from view. It has just three buttons: stop, volume up and volume down; the notification chimes can be adjusted to one of six noise levels. Holding stop while pressing the volume up button twice forces the printer to dial in and check for mail, a handy feature if you can’t wait to receive something.

The printer and its ink cartridges can be ordered through the Presto.com site. They cost $25 for a cartridge that will print about 330 pages and $35 for a 580-page cartridge. The printer’s ink level can be monitored from the Web site, letting the account manager order more ink when necessary.

The Presto service and its accompanying H-P Printing Mailbox offer a simple and relatively affordable way for friends and family to feel included in the otherwise intimidating environment of email. We wish Presto offered a way for recipients to respond, but this service might be just enough for its target audience.

Email: MossbergSolution@wsj.com

To manage these laptop-like tasks, they come equipped with faster and faster processors; more and more internal memory; expansion slots for increasingly spacious memory cards; and small, but usable, keyboards, instead of mere phone keypads.

We’ve been testing two new such phones. One, from Palm Inc., is an improved model of the Treo, which has long been our favorite smartphone. The other, an entirely new design from Motorola Inc., manages to pack most of the Treo’s functionality into a much thinner and lighter body, at half the Treo’s price.

The new Palm model, called the Treo 700p, uses the Palm operating system and is being sold by both Verizon Wireless and Sprint Nextel Corp. for $399, with a service contract. The Motorola challenger, called the Q, uses Microsoft’s Windows Mobile operating system and is being sold by Verizon for $199, with a service contract.

Palm’s Treo 700p, priced at $399 with a service contract (left); Motorola’s Q, priced at $199 with a service contract (right)

The Q is the bigger news here. In the tradition of Motorola’s RAZR phone, the Q is a sleek, handsome devil. It demolishes the two biggest problems with smartphones like the Treo: They are bulky and expensive. The Q is a little wider than the Treo 700p, but it’s just half as thick and, at 4.06 ounces, is more than one-third lighter.

Unfortunately, its Microsoft software is much clumsier than the Treo’s Palm software, degrading its utility. Also, the Q’s screen is lower-resolution than the Treo’s and slightly smaller, and its battery life as a phone is weaker than the Treo’s. While the Q keyboard is larger than the Treo’s, we actually found it worse for typing.

Still, the Q is a decent solution for light email users and for those who have avoided a smartphone due to bulk and cost. We assume that, at $199, the Q will sell well and will challenge the Treo and BlackBerry in the marketplace.

However, we still prefer the Treo for serious users of mobile email, Web and Office. And the new model, with greater speed and other enhancements, only adds to the Treo’s strengths.

Both of these phones run on the new, broadband-like EV-DO data networks offered by Verizon and Sprint, so they are actually practical for Web browsing and for downloading big email attachments. In our tests, both registered speeds of between 200 and 500 kilobits per second, compared with about 70 kbps for the older Sprint and Verizon networks. Neither phone has Wi-Fi wireless capability.

The new Treo 700p is essentially the same as the Treo 700w introduced a few months back, except that the “p” model uses the Palm operating system, while the “w” model uses Windows software. Like the 700w, the newest model has a squarer shape than that of the older Treo 650. It also has bigger, better keys than the 650, roughly twice the usable internal memory and a higher-resolution 1.3-megapixel camera.

Also, the 700p now has — built into its memory — the excellent Documents To Go program from DataViz, which allows you to view, and in some cases edit, Microsoft Word, Excel and PowerPoint documents and Adobe PDF documents.

The main advantage of the 700p, however, is its ability to use the high-speed EV-DO network. And the new Treo can be used as a modem for a laptop, either via a USB cable or a wireless Bluetooth connection.

In our tests, over a couple of weeks, the Treo 700p performed well. Web browsing was a pleasure at the new high speeds. Our only complaint was a short but annoying lag in displaying the text of emails and in performing certain other operations. Also, our test unit crashed twice and had to be restarted. (It didn’t lose any data in the crash.)

The Q is a mixed bag. Its hardware is elegant. Its software is annoying, often requiring two clicks to do what takes one on the Palm.

Motorola chose a more stripped-down version of Windows Mobile software than the one used on previous keyboard phones, and it does work better one-handed. But it still requires many of the extra steps of its Windows sibling and yet lacks the touch screen and built-in Office programs of other Windows-based smartphones.

In our tests, we found the Q easy to carry, but often irritating to use. Things like muting the phone, locking the keyboard and even playing the built-in solitaire game took much more effort than performing the same tasks on the Treo.

The Q has four navigation buttons positioned below the screen like the Treo; like a BlackBerry, it has a scroll wheel and back button on the right edge. The Q’s keyboard has more space between each key than most smartphones, but the rounded shape of the keys themselves makes them uncomfortable to use for more than a few sentences of email.

The familiar green Send and red End keys are prominently located just above the keyboard, and number keys are distinguished in black. We chatted away using the Q’s phone, and it worked well on voice calls.

Special designated Back and Home keys are next to the Send and End keys, and two other buttons enable direct access to email and the Q’s digital camera.

We set up email accounts on the Q using EarthLink and Hotmail.com, but Windows Mobile software really started to get annoying while we were navigating through our email. Performing a task as simple as deleting a message requires two steps — selecting Menu, then selecting Delete — and we couldn’t find any way to highlight and delete a group of emails.

By contrast, on the Treo, using the major email programs, you can delete an email with one click and even clean out a whole inbox with a couple of clicks. This may not matter much to people who get little email, but for heavy users, it’s crucial.

We also had trouble with attachments on the Q. While we successfully received some pictures and documents, a test series of four emails, each with a different type of document attached, failed on the Q. On both of our test Q units, using two different email services, the four attachments simply disappeared, even though they came through fine on the Treo and on Windows and Macintosh computers.

Viewing Microsoft Office and PDF files on the Q is a more cumbersome process than on the Treo, and the files can’t be edited on the Q.

The 320×240 resolution on the Q’s screen is 25% lower than that of the Treo 700p, which has a 320×320-resolution screen. Many things — Web sites, photos, attachments — just didn’t look as good on the Q compared side-by-side with the Treo. The Q’s built-in 1.3-megapixel digital camera captured videos and still shots without a problem, but the view on our screen was cluttered by information bars at the top and bottom.

You might like the $199 Motorola Q because of its price tag or striking design. If you don’t use email too much, or if you’ve never used another smartphone, you might not miss the more user-friendly features that the Treo 700p has to offer. We wish that the sleekness of the Motorola Q could be combined with the intuitive features of the Treo 700p. For now, we’ll stick with what works best — the newest Treo.

• Email: MossbergSolution@wsj.com

But many corporate information-technology departments have refused to buy the phone. Why? Because the Treo is powered by the Palm operating system and not by software from Microsoft, the only company whose software is supported by many IT departments.

So Palm this week introduced a Treo model that uses the latest version of Microsoft’s Windows Mobile software (formerly known as Pocket PC). On the outside, the new Treo 700w looks very much like the current Palm-based model, the Treo 650, which will remain on sale and will continue to be developed on a parallel track. On the inside, though, the new Treo’s key software functions — phone, email, Web, multimedia — are all different.

I have been testing the Treo 700w, which will be sold by Verizon Wireless, to see how it stacks up against the Treo 650, the phone I carry every day.

My verdict: Despite some nice new features, the Windows Mobile software is still inferior to the Palm software for one-handed use on the go. Its crucial email and phone functions are also weaker. And there’s a serious bug in its email software that affects individuals, though not corporate users. So the Treo 700w is neither as easy to use nor as powerful as the Treo 650. In addition, the screen on the 700w offers significantly lower resolution than the screen on the 650, and the new model costs twice as much — $400 versus $200.

For individual users, the main advantage of the new Treo 700w is that it is the first Treo to work on Verizon’s high-speed EV-DO network. That network delivers data speeds that rival those of home DSL lines. But the speed advantage will be short-lived, because I expect to see a Palm-based Treo in coming months that can also use the EV-DO network.

At first glance, the phones look nearly identical, though the new 700w is a bit more rounded. The key dimensions are all the same, but the color scheme is a bit different and the 700w has a slightly better keyboard. The individual keys are squarer, with a bit more room between them.

The built-in camera on the new model is much better than the primitive one on the 650. It can shoot at a resolution of 1.3 megapixels, up from just a third of a megapixel for the older camera. In my tests, the 700w’s pictures were much better. But the resolution of the screen on the 700w, a vastly more important component, has changed for the worse. Although it is about the same physical size as the 650 screen, it has a resolution of only 240 by 240, 44% lower than the 320-by-320 resolution on the Treo 650 screen.

There are some offsetting pluses. In my tests, downloading Web pages on the Treo 700w was wicked fast for a hand-held, typically hovering between 500 and 800 kilobits per second, roughly 10 times as fast as on the Treo 650. Also, the new model has more than twice as much usable memory, and slightly better claimed battery life.

Palm has also added some nice features to the Windows Mobile software. The Today page, which summarizes information like appointments and unread email, has been vastly beefed up. It now includes a box for looking up phone numbers and one for doing a Google search.

In addition, you can quickly initiate a phone call from the Today screen in a number of ways: You can start typing a number or a name from your contacts list, and that contact will pop up. You can use a previously assigned speed-dial letter or number. Or you can set up a scrolling bar containing photos of your frequent contacts and then tap on the relevant picture.

Palm has added other goodies. You can choose to respond to an incoming call with a text message, which is great if you’re in a meeting. And when listening to voice mail, you can use VCR-like icons to navigate among messages.

But lots of tasks on the Treo 700w require extra steps. On the 650, one click of a button takes you to email. On the 700w, two button presses are necessary. On the 650, the leading email programs allow you to delete a message by pressing one key. On the 700w, you have to press a key, view a menu and then press a second key.

And the email program lacks many of the advanced features of VersaMail or SnapperMail on the Palm-based Treo. For instance, there’s no simple way to delete — or to mark as read — large groups of messages.

When you’re on a phone call on a Palm-based Treo, you can turn on the speaker phone or mute the microphone by tapping large icons with your thumb. On the Windows-based Treo, you have to open a menu and then select these functions.

And then there’s that email bug. If you’re using a so-called POP email account, like the ones offered to consumers by EarthLink and many others, the Treo 700w will disconnect from the network after it checks for new email. This means that when the 700w next checks for email — or when you next try to get on the Net — you’ll have to wait for it to dial into the network again, which is annoying. Microsoft is working on a fix, but it will take months to deploy the patch to users.

The Treo 700w will appeal to some Windows Mobile fans, and to some corporate IT staffs. But for everyone else, I advise sticking with the Palm-based Treos.

• Email me at mossberg@wsj.com.

Lately, however, that has begun to change. A number of major Web-mail providers have introduced versions that offer much more of the ease of use and power of desktop email programs like Microsoft Outlook. Yet they still retain the core advantage of Web-mail services: They can be accessed from any computer, Windows or Mac, with your settings and preferences always present. All you need is an Internet connection and a Web browser.

Google kicked off the trend last year with Gmail, which for the first time offered to store, free, a huge volume of old email messages — 1 gigabyte, which was raised to 2 gigabytes or more. Other Web players boosted their free storage limits.

Now, the Web-mail competition has taken a new turn, going beyond storage. Yahoo, EarthLink and AOL all have recently introduced versions that lift their functionality well beyond the old model of Web mail. All are using new programming techniques that turn them from simple Web pages into something resembling the fluidity of desktop applications.

For instance, these new email offerings allow you to drag and drop items, and do most things without waiting for a Web page to refresh or a new page to open. That’s a big change from the old system, where any significant action was performed in circuitous ways and required the Web page containing the email program to tediously reload.

This is a major breakthrough, and one that will extend beyond Web mail. More Web sites will be revamped to look and work like regular desktop programs, hastening the day when most applications may reside online.

I’ve been comparing the new version of Yahoo Mail, which claims to be the leader in Web mail, with Gmail, the challenger Yahoo most fears. My verdict: The new Yahoo Mail is far superior to Gmail. Yahoo more closely matches the desktop experience most serious email users have come to expect. Gmail, by contrast, is quirky and limited. Its only advantage is its massive free storage, which exceeds what most people will ever need.

Both products are officially in “beta,” or test, status. Neither is easy to obtain and use. If you want a Gmail account, you have to be invited by an existing account holder, or go through an odd sign-up process using your cellphone. Yahoo’s new version, just a week old, is — for now — available only to Yahoo Mail account holders the company selected, though the user pool will be expanded later this fall.

The new Yahoo Mail retains the basic terms of the current version. You get 1 gigabyte of mail storage free of charge, and the program displays ads. For $20 a year, the storage doubles to 2 gigabytes, and the ads disappear.

The new version is radically easier to use. For example, there’s a preview pane, just as in desktop programs, that allows you to view the contents of an email without opening it. You can open multiple emails at once. You can drop messages into folders you create. You can right-click on various items to see short menus of useful tasks, like “add sender to address book.” You can delete multiple messages at once by selecting them and clicking on a trash-can icon.

By contrast, Gmail has none of these new, fluid, desktop-like features. You can’t scroll through all of your messages’ headers without loading a new Web page. And there’s no preview pane, only a feature that shows a snippet of the content of an email.

To delete groups of messages, you have to wait for multiple consecutive pages to load, showing new headers. You can’t drag and drop. And Gmail’s address book, unlike Yahoo’s, doesn’t allow you to collect contacts into group addresses.

But Gmail’s limitations go beyond this. On several key issues, Google’s engineers have decreed that familiar email practices are no longer useful, and have substituted approaches they prefer, arrogantly denying users any choice.

Gmail doesn’t allow folders, only color-coded labels, as an organizing technique. It forces you to view all of your email in groups of related messages called “conversations,” instead of viewing them individually as they arrive. Other email programs also allow such grouped views, but they permit users to choose. Not Gmail, where “option” is a term too rarely employed, except in reference to employee compensation. (Yahoo plans to add an optional grouped view soon.)

Similarly, Gmail forces you to view ads alongside your emails. Unlike Yahoo, it offers no paid option to avoid the ads.

I’m sure Gmail will get better and better, and will eventually adopt the new programming techniques that allow desktop-like ease of use. But I’m not sure Google’s arrogance will ever make room for user preferences on things like folders or ads, or how emails are grouped.

Yahoo’s new email program would blow Gmail away if it were widely released today. That’s partly due to its features, but also to its respect for user choice.

• Email me at mossberg@wsj.com