IT'S HARD TO BUILD something that's easy to use. Churning out a complicated PC is routine, but building one of the new, simpler Internet appliances is a tricky business. If you include a million commands and functions, you can't make it simple. If you seek simplicity by removing too many functions, you cripple the product. That's one reason why most of the first efforts to sell counter-top Internet appliances, such as the i-Opener and the Audrey, have failed.

Still, companies keep trying to perfect the appliance idea, and we've been testing out two new entries. One is the first Internet appliance from Sony, a company acclaimed for making things simple and elegant. The other is the second edition of Compaq and Microsoft's Home Internet Appliance, which was the best of the first generation.

Sony's entry, the eVilla, looks very different from all the others. While most of them are small devices with flat-panel screens, the eVilla is a big, heavy box designed around a built-in regular monitor that's positioned vertically to allow users to read Web pages without much scrolling. This design may have been chosen because the eVilla was actually designed by Sony's monitor division, as opposed to its computer or consumer-electronics arms.

There are some good ideas in the eVilla, but I can't recommend it. It's too large to fit comfortably on a kitchen counter and too expensive for this type of product, at $500 plus $22 a month for the Internet service it uses. It's also not ready for consumers. In my tests, I ran into frustrating problems.

The first thing that happened was that the eVilla crashed while trying to run a built-in demo. I had to reboot the machine by inserting a bent paper clip into a tiny reset hole. That's a bad thing in a PC, but it's fatal in an Internet appliance, which is supposed to be foolproof and simple. Then, I went through several failed attempts to register, the necessary first step before the eVilla can be used. In each case, the machine stalled or froze during the sign-up process. I had to reboot once more.

The next day, I tried again. This time, I was able to get registered after only two frustrating attempts. Once up and running, I was able to use the eVilla for e-mail and Web surfing, but its supposed strength is in entertainment -- playback of audio and video from the Web. Unfortunately, I found that it did this slowly and poorly over the dial-up connection, which is the only way it can connect.

It is also not a very smart device. The "hometown" page, which is supposed to provide local news, had no idea where I lived, even though I'd given all that info to Sony during registration.

The eVilla has some good points. The unit can display pictures, sound and video from a Sony memory stick module taken from a Sony camera, PC or MP3 player. And it can also use a Zip drive for storage. But, at least for now, the eVilla is a dud, unworthy of the Sony name.

By contrast, the Compaq iPAQ Home Internet Appliance works quite well, and in its second edition it retains the title of the best Internet appliance I've seen. The hardware, solid and well-designed last year, is unchanged. What's new is the pricing and the software. Microsoft has updated its MSN Companion software to version 2 and added some important new features.

Compaq's iPaq The iPAQ now costs $299 for a version with an embedded regular monitor (smaller than the Sony's) or $399 for the flat-panel version I tested. In addition, there's a $22 a month fee for MSN service, but you get six months of service free and you don't have to sign a multiyear contract. Starting Saturday, Compaq will offer the $399 flat-panel model for just $299, and will throw in a printer, if you buy it via TV's Home Shopping Network.

Also, the new version allows up to nine users to share the machine, each with his or her own private e-mail accounts. And you can share a single MSN account between the iPAQ and a PC, accessing your e-mail from either.

Another big change: You can now hook the iPAQ home appliance up to a high-speed broadband connection, such as a DSL line or a cable modem, if you buy a $50 adapter. I hooked my test model up to my DSL line in under five minutes and it really sped up the loading of Web pages and the retrieval of e-mail. But the machine still worked much more slowly than a modern PC connected to broadband.

There are still some drawbacks to the iPAQ. Because of Microsoft's business rivalries, the unit won't support common Web technologies from competing companies like RealNetworks or Sun. That means you can't play back most of the streaming audio and video on the Web, or use sites that employ Sun's Java language. The machine still won't allow you to create group e-mail addresses, or read and compose e-mail while offline.

But the iPAQ gets the basics right at a reasonable price. It works, and would be a good choice for a novice who can't afford or doesn't want a PC, or as a sort of secondary e-mail and e-commerce terminal in the kitchen or family room, even in a home that has a PC.