diff --git a/services/sync/modules/engines.js b/services/sync/modules/engines.js
index b4f4062f1e7c..f89112b32889 100644
--- a/services/sync/modules/engines.js
+++ b/services/sync/modules/engines.js
@@ -35,7 +35,7 @@
  *
  * ***** END LICENSE BLOCK ***** */
 
-const EXPORTED_SYMBOLS = ['Engines', 'Engine', 'SyncEngine', 'FileEngine'];
+const EXPORTED_SYMBOLS = ['Engines', 'Engine', 'SyncEngine', 'BlobEngine'];
 
 const Cc = Components.classes;
 const Ci = Components.interfaces;
@@ -322,48 +322,30 @@ SyncEngine.prototype = {
       return;
     }
 
-    if (this._remote.status.data.GUID != this._snapshot.GUID) {
-      this._log.debug("Remote/local sync GUIDs do not match.  " +
-                     "Forcing initial sync.");
-      this._log.trace("Remote: " + this._remote.status.data.GUID);
-      this._log.trace("Local: " + this._snapshot.GUID);
-      yield this._store.resetGUIDs(self.cb);
-      this._snapshot.data = {};
-      this._snapshot.version = -1;
-      this._snapshot.GUID = this._remote.status.data.GUID;
-    }
-
-    this._log.info("Local snapshot version: " + this._snapshot.version);
-    this._log.info("Server maxVersion: " + this._remote.status.data.maxVersion);
-
-    if ("none" != Utils.prefs.getCharPref("encryption"))
-      yield this._remote.keys.getKeyAndIV(self.cb, this.engineId);
-
     // 1) Fetch server deltas
 
     this._os.notifyObservers(null, "weave:service:sync:status", "status.downloading-deltas");
-    let server = {};
-    let serverSnap = yield this._remote.wrap(self.cb, this._snapshot);
-    server.snapshot = serverSnap.data;
-    this._core.detectUpdates(self.cb, this._snapshot.data, server.snapshot);
-    server.updates = yield;
+    let serverSnap = yield this._remote.wrap(self.cb);
+    let serverUpdates = yield this._core.detectUpdates(self.cb,
+                                                       this._snapshot.data, serverSnap);
 
     // 2) Generate local deltas from snapshot -> current client status
 
     this._os.notifyObservers(null, "weave:service:sync:status", "status.calculating-differences");
-    let localJson = new SnapshotStore();
-    localJson.data = this._store.wrap();
-    this._core.detectUpdates(self.cb, this._snapshot.data, localJson.data);
+    let localSnap = new SnapshotStore();
+    localSnap.data = this._store.wrap();
+    this._core.detectUpdates(self.cb, this._snapshot.data, localSnap.data);
     let localUpdates = yield;
 
-    this._log.trace("local json:\n" + localJson.serialize());
+    this._log.trace("local json:\n" + localSnap.serialize());
     this._log.trace("Local updates: " + this._serializeCommands(localUpdates));
-    this._log.trace("Server updates: " + this._serializeCommands(server.updates));
+    this._log.trace("Server updates: " + this._serializeCommands(serverUpdates));
 
-    if (server.updates.length == 0 && localUpdates.length == 0) {
-      this._snapshot.version = this._remote.status.data.maxVersion;
+    if (serverUpdates.length == 0 && localUpdates.length == 0) {
       this._os.notifyObservers(null, "weave:service:sync:status", "status.no-changes-required");
       this._log.info("Sync complete: no changes needed on client or server");
+      this._snapshot.version = this._remote.status.data.maxVersion;
+      this._snapshot.save();
       self.done(true);
       return;
     }
@@ -372,8 +354,7 @@ SyncEngine.prototype = {
 
     this._os.notifyObservers(null, "weave:service:sync:status", "status.reconciling-updates");
     this._log.info("Reconciling client/server updates");
-    this._core.reconcile(self.cb, localUpdates, server.updates);
-    let ret = yield;
+    let ret = yield this._core.reconcile(self.cb, localUpdates, serverUpdates);
 
     let clientChanges = ret.propagations[0];
     let serverChanges = ret.propagations[1];
@@ -393,20 +374,15 @@ SyncEngine.prototype = {
           clientConflicts.length || serverConflicts.length)) {
       this._os.notifyObservers(null, "weave:service:sync:status", "status.no-changes-required");
       this._log.info("Sync complete: no changes needed on client or server");
-      this._snapshot.data = localJson.data;
+      this._snapshot.data = localSnap.data;
       this._snapshot.version = this._remote.status.data.maxVersion;
       this._snapshot.save();
       self.done(true);
       return;
     }
 
-    if (clientConflicts.length || serverConflicts.length) {
+    if (clientConflicts.length || serverConflicts.length)
       this._log.warn("Conflicts found!  Discarding server changes");
-    }
-
-    let savedSnap = Utils.deepCopy(this._snapshot.data);
-    let savedVersion = this._snapshot.version;
-    let newSnapshot;
 
     // 3.1) Apply server changes to local store
 
@@ -414,29 +390,27 @@ SyncEngine.prototype = {
       this._log.info("Applying changes locally");
       this._os.notifyObservers(null, "weave:service:sync:status", "status.applying-changes");
 
-      // Note that we need to need to apply client changes to the
-      // current tree, not the saved snapshot
+      // apply to real store
+      yield this._store.applyCommands.async(this._store, self.cb, clientChanges);
 
-      localJson.applyCommands.async(localJson, self.cb, clientChanges);
-      yield;
-      this._snapshot.data = localJson.data;
-      this._snapshot.version = this._remote.status.data.maxVersion;
-      this._store.applyCommands.async(this._store, self.cb, clientChanges);
-      yield;
-      newSnapshot = this._store.wrap();
+      // get the current state
+      let newSnap = new SnapshotStore();
+      newSnap.data = this._store.wrap();
 
-      this._core.detectUpdates(self.cb, this._snapshot.data, newSnapshot);
-      let diff = yield;
+      // apply to the snapshot we got in step 1, and compare with current state
+      yield localSnap.applyCommands.async(localSnap, self.cb, clientChanges);
+      let diff = yield this._core.detectUpdates(self.cb,
+                                                localSnap.data, newSnap.data);
       if (diff.length != 0) {
         this._log.warn("Commands did not apply correctly");
         this._log.trace("Diff from snapshot+commands -> " +
                         "new snapshot after commands:\n" +
                         this._serializeCommands(diff));
-        // FIXME: do we really want to revert the snapshot here?
-        this._snapshot.data = Utils.deepCopy(savedSnap);
-        this._snapshot.version = savedVersion;
       }
-      this._snapshot.save();
+
+      // update the local snap to the current state, we'll use it below
+      localSnap.data = newSnap.data;
+      localSnap.version = this._remote.status.data.maxVersion;
     }
 
     // 3.2) Append server delta to the delta file and upload
@@ -445,10 +419,10 @@ SyncEngine.prototype = {
     // current client snapshot.  In the case where there are no
     // conflicts, it should be the same as what the resolver returned
 
-    this._os.notifyObservers(null, "weave:service:sync:status", "status.calculating-differences");
-    newSnapshot = this._store.wrap();
-    this._core.detectUpdates(self.cb, server.snapshot, newSnapshot);
-    let serverDelta = yield;
+    this._os.notifyObservers(null, "weave:service:sync:status",
+                             "status.calculating-differences");
+    let serverDelta = yield this._core.detectUpdates(self.cb,
+                                                     serverSnap, localSnap.data);
 
     // Log an error if not the same
     if (!(serverConflicts.length ||
@@ -462,46 +436,38 @@ SyncEngine.prototype = {
 
     if (serverDelta.length) {
       this._log.info("Uploading changes to server");
-      this._snapshot.data = newSnapshot;
-      this._snapshot.version = ++this._remote.status.data.maxVersion;
+      this._os.notifyObservers(null, "weave:service:sync:status",
+                               "status.uploading-deltas");
 
-      // XXX don't append delta if we do a full upload?
-      if (this._remote.status.data.formatVersion != ENGINE_STORAGE_FORMAT_VERSION)
-        yield this._remote.initialize(self.cb, this._snapshot);
-
-      let c = 0;
-      for (GUID in this._snapshot.data)
-        c++;
-
-      this._os.notifyObservers(null, "weave:service:sync:status", "status.uploading-deltas");
-
-      this._remote.appendDelta(self.cb, this._snapshot, serverDelta,
-                               {maxVersion: this._snapshot.version,
-                                deltasEncryption: Crypto.defaultAlgorithm,
-                                itemCount: c});
-      yield;
+      yield this._remote.appendDelta(self.cb, localSnap, serverDelta,
+                                     {maxVersion: this._snapshot.version,
+                                      deltasEncryption: Crypto.defaultAlgorithm});
+      localSnap.version = this._remote.status.data.maxVersion;
 
       this._log.info("Successfully updated deltas and status on server");
-      this._snapshot.save();
     }
 
+    this._snapshot.data = localSnap.data;
+    this._snapshot.version = localSnap.version;
+    this._snapshot.save();
+
     this._log.info("Sync complete");
     self.done(true);
   }
 };
 
-function FileEngine() {
+function BlobEngine() {
   // subclasses should call _init
   // we don't call it here because it requires serverPrefix to be set
 }
-FileEngine.prototype = {
+BlobEngine.prototype = {
   __proto__: new Engine(),
 
   get _profileID() {
     return ClientData.GUID;
   },
 
-  _init: function FileEngine__init() {
+  _init: function BlobEngine__init() {
     // FIXME meep?
     this.__proto__.__proto__.__proto__.__proto__._init.call(this);
     this._keys = new Keychain(this.serverPrefix);
@@ -510,8 +476,9 @@ FileEngine.prototype = {
     this._file.pushFilter(new CryptoFilter(this.engineId));
   },
 
-  _initialUpload: function FileEngine__initialUpload() {
+  _initialUpload: function BlobEngine__initialUpload() {
     let self = yield;
+    this._log.info("Initial upload to server");
     yield this._keys.initialize(self.cb, this.engineId);
     this._file.data = {};
     yield this._merge.async(this, self.cb);
@@ -520,7 +487,7 @@ FileEngine.prototype = {
 
   // NOTE: Assumes this._file has latest server data
   // this method is separate from _sync so it's easy to override in subclasses
-  _merge: function FileEngine__merge() {
+  _merge: function BlobEngine__merge() {
     let self = yield;
     this._file.data[this._profileID] = this._store.wrap();
   },
@@ -531,7 +498,7 @@ FileEngine.prototype = {
   // 3) Upload new merged data
   // NOTE: a version file will be needed in the future to optimize the case
   //       where there are no changes
-  _sync: function FileEngine__sync() {
+  _sync: function BlobEngine__sync() {
     let self = yield;
 
     this._log.info("Beginning sync");
@@ -548,12 +515,45 @@ FileEngine.prototype = {
       yield this._file.put(self.cb);
 
     } catch (e if e.status == 404) {
-      this._log.info("Initial upload to server");
       yield this._initialUpload.async(this, self.cb);
     }
 
     this._log.info("Sync complete");
-    this._os.notifyObservers(null, "weave:service:sync:engine:end", this.name);
+    this._os.notifyObservers(null, "weave:service:sync:engine:success", this.name);
     self.done(true);
   }
 };
+
+function HeuristicEngine() {
+}
+HeuristicEngine.prototype = {
+  __proto__: new Engine(),
+
+  get _snapshot() {
+    let snap = new SnapshotStore(this.name);
+    this.__defineGetter__("_snapshot", function() snap);
+    return snap;
+  },
+
+  _resetClient: function SyncEngine__resetClient() {
+    let self = yield;
+    this._log.debug("Resetting client state");
+    this._snapshot.wipe();
+    this._store.wipe();
+    this._log.debug("Client reset completed successfully");
+  },
+
+  _initialUpload: function HeuristicEngine__initialUpload() {
+    let self = yield;
+    this._log.info("Initial upload to server");
+    this._snapshot.data = this._store.wrap();
+    this._snapshot.version = 0;
+    this._snapshot.GUID = null; // in case there are other snapshots out there
+    yield this._remote.initialize(self.cb, this._snapshot);
+    this._snapshot.save();
+  },
+
+  _sync: function HeuristicEngine__sync() {
+    let self = yield;
+  }
+};
diff --git a/services/sync/modules/engines/tabs.js b/services/sync/modules/engines/tabs.js
index 0f6a2682de08..25c22a17c23c 100644
--- a/services/sync/modules/engines/tabs.js
+++ b/services/sync/modules/engines/tabs.js
@@ -55,7 +55,7 @@ function TabEngine(pbeId) {
 }
 
 TabEngine.prototype = {
-  __proto__: new FileEngine(),
+  __proto__: new BlobEngine(),
 
   get name() "tabs",
   get displayName() { return "Tabs"; },
diff --git a/services/sync/modules/remote.js b/services/sync/modules/remote.js
index 81c43d079f8c..37f5bf61dea0 100644
--- a/services/sync/modules/remote.js
+++ b/services/sync/modules/remote.js
@@ -429,10 +429,17 @@ function RemoteStore(engine) {
   this._log = Log4Moz.Service.getLogger("Service.RemoteStore");
 }
 RemoteStore.prototype = {
-  __proto__: new Store(),
   get serverPrefix() this._engine.serverPrefix,
   get engineId() this._engine.engineId,
 
+  __os: null,
+  get _os() {
+    if (!this.__os)
+      this.__os = Cc["@mozilla.org/observer-service;1"]
+        .getService(Ci.nsIObserverService);
+    return this.__os;
+  },
+
   get status() {
     let status = new Resource(this.serverPrefix + "status.json");
     status.pushFilter(new JsonFilter());
@@ -462,7 +469,7 @@ RemoteStore.prototype = {
     return deltas;
   },
 
-  _openSession: function RStore__openSession() {
+  _openSession: function RStore__openSession(lastSyncSnap) {
     let self = yield;
 
     if (!this.serverPrefix || !this.engineId)
@@ -472,6 +479,7 @@ RemoteStore.prototype = {
     this.keys.data = null;
     this._snapshot.data = null;
     this._deltas.data = null;
+    this._lastSyncSnap = lastSyncSnap;
 
     let ret = yield DAV.MKCOL(this.serverPrefix + "deltas", self.cb);
     if (!ret)
@@ -491,9 +499,24 @@ RemoteStore.prototype = {
                       ENGINE_STORAGE_FORMAT_VERSION);
       throw "Incompatible remote store format";
     }
+
+    if (this.status.data.GUID != lastSyncSnap.GUID) {
+      this._log.trace("Remote GUID: " + this.status.data.GUID);
+      this._log.trace("Local GUID: " + lastSyncSnap.GUID);
+      this._log.debug("Server wipe since last sync, resetting last sync snapshot");
+      lastSyncSnap.wipe();
+      lastSyncSnap.GUID = this.status.data.GUID;
+      // yield this._store.resetGUIDs(self.cb); // XXX not sure if this is really needed (and it needs to be done from the engine if so)
+    }
+
+    this._log.info("Last sync snapshot version: " + lastSyncSnap.version);
+    this._log.info("Server maxVersion: " + this.status.data.maxVersion);
+
+    if ("none" != Utils.prefs.getCharPref("encryption"))
+      yield this.keys.getKeyAndIV(self.cb, this.engineId);
   },
-  openSession: function RStore_openSession(onComplete) {
-    this._openSession.async(this, onComplete);
+  openSession: function RStore_openSession(onComplete, lastSyncSnap) {
+    this._openSession.async(this, onComplete, lastSyncSnap);
   },
 
   closeSession: function RStore_closeSession() {
@@ -501,6 +524,7 @@ RemoteStore.prototype = {
     this.keys.data = null;
     this._snapshot.data = null;
     this._deltas.data = null;
+    this._lastSyncSnap = null;
   },
 
   // Does a fresh upload of the given snapshot to a new store
@@ -511,7 +535,6 @@ RemoteStore.prototype = {
     yield this.keys.initialize(self.cb, this.engineId);
     this._os.notifyObservers(null, "weave:service:sync:status", "status.uploading-snapshot");
     yield this._snapshot.put(self.cb, snapshot.data);
-    //yield this._deltas.put(self.cb, []);
 
     let c = 0;
     for (GUID in snapshot.data)
@@ -533,6 +556,7 @@ RemoteStore.prototype = {
   },
 
   // Removes server files - you may want to run initialize() after this
+  // FIXME: might want to do a PROPFIND instead (to catch all deltas in one go)
   _wipe: function Engine__wipe() {
     let self = yield;
     this._log.debug("Deleting remote store data");
@@ -550,57 +574,58 @@ RemoteStore.prototype = {
   // (snapshot + deltas)
   _getLatestFromScratch: function RStore__getLatestFromScratch() {
     let self = yield;
-    let status = this.status.data;
 
     this._log.info("Downloading all server data from scratch");
     this._os.notifyObservers(null, "weave:service:sync:status", "status.downloading-snapshot");
 
     let snap = new SnapshotStore();
     snap.data = yield this._snapshot.get(self.cb);
-    snap.version = status.maxVersion;
 
+    this._os.notifyObservers(null, "weave:service:sync:status", "status.downloading-deltas");
+    let status = this.status.data;
     for (let id = status.snapVersion + 1; id <= status.maxVersion; id++) {
       let delta = yield this._deltas.get(self.cb, id);
       yield snap.applyCommands.async(snap, self.cb, delta);
     }
 
-    self.done(snap);
+    self.done(snap.data);
   },
 
   // Gets the latest server snapshot by downloading only the necessary
   // deltas from the given snapshot (but may fall back to a full download)
-  _getLatestFromSnap: function RStore__getLatestFromSnap(lastSyncSnap) {
+  _getLatestFromSnap: function RStore__getLatestFromSnap() {
     let self = yield;
     let deltas, snap = new SnapshotStore();
     snap.version = this.status.data.maxVersion;
 
-    if (lastSyncSnap.version < this.status.data.snapVersion) {
-      this._log.trace("Getting latest from snap --> scratch");
-      snap = yield this._getLatestFromScratch.async(this, self.cb);
-      self.done(snap);
+    if (!this._lastSyncSnap ||
+        this._lastSyncSnap.version < this.status.data.snapVersion) {
+      this._log.trace("Getting latest from scratch (last sync snap too old)");
+      snap.data = yield this._getLatestFromScratch.async(this, self.cb);
+      self.done(snap.data);
       return;
 
-    } else if (lastSyncSnap.version >= this.status.data.snapVersion &&
-               lastSyncSnap.version < this.status.data.maxVersion) {
+    } else if (this._lastSyncSnap.version >= this.status.data.snapVersion &&
+               this._lastSyncSnap.version < this.status.data.maxVersion) {
       this._log.debug("Using last sync snapshot as starting point for server snapshot");
-      snap.data = Utils.deepCopy(lastSyncSnap.data);
+      snap.data = Utils.deepCopy(this._lastSyncSnap.data);
       this._log.info("Downloading server deltas");
       this._os.notifyObservers(null, "weave:service:sync:status", "status.downloading-deltas");
       deltas = [];
-      let min = lastSyncSnap.version + 1;
+      let min = this._lastSyncSnap.version + 1;
       let max = this.status.data.maxVersion;
       for (let id = min; id <= max; id++) {
         let delta = yield this._deltas.get(self.cb, id);
         deltas.push(delta);
       }
 
-    } else if (lastSyncSnap.version == this.status.data.maxVersion) {
+    } else if (this._lastSyncSnap.version == this.status.data.maxVersion) {
       this._log.debug("Using last sync snapshot as server snapshot (snap version == max version)");
       this._log.trace("Local snapshot version == server maxVersion");
-      snap.data = Utils.deepCopy(lastSyncSnap.data);
+      snap.data = Utils.deepCopy(this._lastSyncSnap.data);
       deltas = [];
 
-    } else { // lastSyncSnap.version > this.status.data.maxVersion
+    } else { // this._lastSyncSnap.version > this.status.data.maxVersion
       this._log.error("Server snapshot is older than local snapshot");
       throw "Server snapshot is older than local snapshot";
     }
@@ -613,23 +638,21 @@ RemoteStore.prototype = {
       this._log.warn("Error applying remote deltas to saved snapshot, attempting a full download");
       this._log.debug("Exception: " + Utils.exceptionStr(e));
       this._log.trace("Stack:\n" + Utils.stackTrace(e));
-      snap = yield this._getLatestFromScratch.async(this, self.cb);
+      snap.data = yield this._getLatestFromScratch.async(this, self.cb);
     }
 
-    self.done(snap);
+    self.done(snap.data);
   },
 
   // get the latest server snapshot.  If a snapshot is given, try to
   // download only the necessary deltas to get to the latest
-  _wrap: function RStore__wrap(snapshot) {
+  _wrap: function RStore__wrap() {
     let self = yield;
-    if (snapshot)
-      self.done(yield this._getLatestFromSnap.async(this, self.cb, snapshot));
-    else
-      self.done(yield this._getLatestFromScratch.async(this, self.cb));
+    let ret = yield this._getLatestFromSnap.async(this, self.cb);
+    self.done(ret);
   },
-  wrap: function RStore_wrap(onComplete, snapshot) {
-    this._wrap.async(this, onComplete, snapshot);
+  wrap: function RStore_wrap(onComplete) {
+    this._wrap.async(this, onComplete);
   },
 
   // Adds a new set of changes (a delta) to this store
@@ -641,8 +664,12 @@ RemoteStore.prototype = {
         this.status.data[key] = metadata[key];
     }
 
-    // FIXME: we should increment maxVersion here instead of in Engine
-    let id = this.status.data.maxVersion;
+    let c = 0;
+    for (item in snapshot.data)
+      c++;
+    this.status.data.itemCount = c;
+
+    let id = ++this.status.data.maxVersion;
 
     // upload the delta even if we upload a new snapshot, so other clients
     // can be spared of a full re-download