WHAT'S HOT: A fast 1.8 lens supports better low-light imaging without flash and a greater chance of getting a sharp image of quick-moving subjects under these conditions. Audio recording is another high point. You can record QuickTime movie clips with sound, and you can add audio notes to still shots. Overall, the camera has an uncluttered look and a solid grip.

WHAT'S NOT: The LED status panel on the top of the camera imparts relatively little information. Since it doesn't give exposure settings, you must turn on the main LCD panel to check those numbers. The Camedia C-4040's documentation could be better, too. You get a multiple-language printed manual with basic instructions for using the camera, as well as more-detailed instructions on a CD. Unfortunately, the printed manual omits much of the useful information found on the disc. For example, we couldn't find instructions for performing instant image review and delete or for using the audio memo function. Also, the zoom seems a bit slow.

WHAT ELSE: Based on our test shots, we awarded the Camedia C-4040 an overall image quality score of good. On indoor shots with flash, the camera produced sharp, accurate photos, with warm skin tones. The exposure was just a hair on the dark side. The white balance was off in our indoor shot with daylight-balanced lights. Our neutral-gray background acquired a slight amber tint, and our model's skin was a patchwork of harsh highlights. On the other hand, in shots taken outdoors on a sunny day, the C-4040 produced finely detailed images with accurate highlights and shadows and little visible mottling in a solid blue sky.

Though the Camedia C-4040 includes nearly all the controls you'd expect in a high-end camera, setting its manual controls isn't as quick and easy as with models like the similarly shaped Casio QV-4000 or the Minolta Dimage 7--both of which have spinning selector dials that let you change shutter speeds and apertures very quickly. In contrast, the Olympus relies heavily on menus and on a four-button thumb pad for changing those basic settings. Changing from shutter priority to aperture priority, for example, requires about five button presses. The same is true for changing resolution settings. When in aperture or shutter priority mode, you must pick a setting by repeatedly pressing the up and down navigation buttons. The Camedia C-4040 is one of the few cameras we've seen that make you use menus to turn on the self-timer.

Still, the menus are well organized, and the layout of the exposure settings is clean and efficient, with the aperture, shutter speed, and exposure value data listed together at the top of the LCD display. In aperture mode, the camera instantly updates the shutter speed information (some cameras require you to press the shutter release part way). You can program a commonly used function--such as changing the resolution or exposure control (aperture, shutter, or manual)--into any of the four menu navigation buttons, and the camera offers true exposure lock. Once you press the AEL button, the exposure is locked until you press the button again, no matter how many shots you take in between. (The exposure lock on many digital cameras holds the exposure settings for just one shot.)

The settings for resolution and JPEG compression are not easy to decipher, and the zoom is a bit noisy. If you don't remember to remove the lens cap before switching the camera on, the zoom lens grinds away for a few seconds, the camera beeps at you, and eventually the lens may pop the cover off.

Among the camera's useful extras are a panorama mode, an external-flash sync socket, simple white-balance calibration, a wireless remote shutter release, and Adobe Photoshop LE.

UPSHOT: Full-featured and relatively easy to use, the Camedia C-4040 is a nice fit for a business user looking seeking a simple yet flexible digital camera, or for serious snapshot-takers who don't like to fiddle frequently with camera controls.

SUMMARY

Olympus Camedia C-4040 Zoom 4.1 megapixels, 2272 by 1704 maximum resolution, 35mm-105mm focal range (35mm film equivalent), f1.8-f10 aperture range, shutter speeds from 4 seconds to 1/800 second, optical and LCD viewfinders, USB and video connections, 16MB SmartMedia card, two 3-volt disposable lithium ion batteries, 14.1 ounces with batteries; Camedia Master 2.5, Adobe Photoshop 5.0 Limited Edition software. One-year parts and labor warranty; 13-hour weekday toll-call support. $899 800/622-6372 www.olympus.com