IMHO the colors and the php name is better then some oval without text. This favicon resembles the font of the logo, and the color. And it is more readable. IMHO it looks better in bookmarks listings and on the personal toolbar in the browser too. The oval version had a white background behind, which was not that nice IMHO.
I'm sharing Collin's mind, the favicon doesn't corrspond to the PHP Logo. What about turning the "font" used italic and bold (to have less white and more black) ?
I realize that drawing anything meaningful in 1 16x16 block of pixels is pretty much impossible. :)
So maybe we forget the oval and the "php" text completely and just have this:
<?
in white or black text on a purple background?
Well, this is not closer to PHP IMHO :) This short syntax is depreciated (or if not, than it is not supposed to be used anymore), and resembles an XML processing instruction instead, which is a bit more general, than what we would like to express here, don't you think?
Goba