NewsGator, the company behind the popular FeedDemon and NetNewsWire feed readers, just announced that it will shut down the NewsGator Online Reader on August 31, 2009. The company will provide users with instructions on how to migrate to Google Reader. NewsGator’s desktop and mobile feed readers already support synchronization with Google Reader. Until today, though, users could choose between syncing with NewsGator or Google Reader. New versions of FeedDemon and NetNewsWire for the Mac will be available today. A new version of NewsGator’s iPhone app will also arrive in the App Store soon.

NewsGator Focuses on the Enterprise

This move probably makes a lot of sense for NewsGator, as the company can now focus more on working with its enterprise and government customers. Running an online RSS reader is pretty resource intensive. For the most part, NewsGator was only duplicating Google Reader’s features anyway, though it did offer a number of features that Google doesn’t yet offer in its online RSS reader.

The most important part of the announcement actually comes at the end of the FAQ about the transition. NewsGator argues that its enterprise products have grown at a record pace in the last 18 months. The company also announced that its Social Sites product already has over a million paying users. Under these circumstances, offering a free online news reader probably didn’t make any sense for NewsGator anymore.

Free Desktop Readers Will Live On

It’s important to note that the company will continue to develop and support its free desktop and mobile readers, though NewsGator Go! for BlackBerry and Windows Mobile will no longer be available for consumers after August 31. NewsGator’s browser toolbar and desktop notifier will also be discontinued.

This guest post is written by Marcelo Calbucci, the founder and CTO of Sampa — a personal homepage creator that will be shutting down next month. He’s writing a series of posts about the lessons learned from the venture at http://blog.calbucci.com. He’s also the publisher of Seattle 2.0, a web resource for tech entrepreneurs and startups in Seattle.

Consumer startups are tough. You have two basic choices: A paid offering or a free offering (or freemium). If you charge people a penny, you’ll turn off the bulk of your visitors. If you offer free services, you might grow to be the next YouTube, Wordpress or Facebook. Most entrepreneurs are not risk-averse and the dream of being big is just too appealing and the majority of us take the “free-route”.

Once you offer something for free, all shades of people will try to benefit from your service. You’d think a service like Sampa with a strong family and baby branding would just repel small business, teenagers, criminals, etc. but that’s not the case at all. And I suspect most blogging services; photo-sharing or web-site building solutions face the exact same issue we did.

Most entrepreneurs and investors will look at data analysis and talk about averages or totals: Averages number of blog posts per user per week, average number of sign-ins per user per month, viral coefficient, total number of active users, etc. Entrepreneurs who are more sophisticated will split their “averages” and “totals” in two or three groups. For example, fixing one of the dimensions into users that sign-in 30 or more times per month (very engaged), between 10 and 29 times per month (engaged), and between 0-9 times per month (on the brink of leaving) and then run the averages and totals for the different groups (e.g. “very engaged users upload 25 pictures/month, engaged users upload 7 pictures/month, etc.”)

Very few startups actually look at demographic and psychographic data as a way to group their users. Primarily, because it’s hard to get gender, age, income, interests and intentions without asking the user, and once you ask them you might just scare them way or get the wrong information.

One time we went to pitch Sampa to a VC in Seattle, and out of the blue he mentions this other startup growing amazingly fast – had nothing to do with our business. After the meeting I went to check the startup website. Their Compete and Alexa growth was just amazing. Their website contained profiles of all users since it was a public social network. So I clicked on the profile of the 20 people featured on their homepage (“most recent users to join”). Of those, about 75% were girls between the age of 9 and 13 – likely the worst demographic to make any revenue from.

Did the startup know about this? Oh, yeah. Did that VC that was looking at investing on them? Likely not.

In the middle of 2008 we decide to do a qualitative analysis of our user base. People of all kinds were creating sites on Sampa. There wasn’t an automated way to know if it was a baby site, a family site, a small business, a technology blog, etc. We looked at more than 300 sites, randomly selected and created a spreadsheet with the category, the demographic of the author (if we could figure out) and we plugged that into our own analytic system to split our averages and totals for each site category. The results sucked!

Just 20% of our users were on the target audience. That meant 80% were not building any kind of family or baby site. Ok, maybe we can live with that. But it turned out that more than 25% were by pre-teens. There are two problems with that: First, It’s actually illegal in the US and most countries to allow a younger than 13-year-old to sign up to your service without parental consent. Second, pre-teens are not a great audience to build an advertising-based business model.

However the data showed an even worse picture. Pre-teens were a quick burning flame. They would come, upload lots of pictures, write lots of blog posts, “bling” their site, invite 20+ friends and they would be completely gone in a month. That behavior skewed our data enough that once we looked at our growth, viral rates, and everything else, our business didn’t look so great.

Being Proactive Can Backfire

Can you force users to comply with your Terms-Of-Service and still be successful on a UGC service? Yes, you can. Facebook manage to be very aggressive on the enforcement of their TOS, and so did Flickr. However, if you look at most Web 2.0 startups, they are not doing that at all. The most prominent case is YouTube, which allowed copyright infringement on their website and can plot a $1.6B exit based on their “turn a blind eye” strategy.

We didn’t do that at Sampa, and I’m sure we could have seen 2 or 3 times more growth if we had used the same strategy. We proactively removed pre-teens websites. They weren’t easy to find, but every time we found one, we would remove the website and notify the owner she was 12-years-old. They would be mad at us and tell that “Jamie, Emily and Sally also have a website on Sampa”, and we would say thank you and delete all their friends websites too.

We would also proactively delete porn websites. There is nothing wrong with porn. It’s not illegal or immoral in my view, but it didn’t go well with our family-oriented business proposition. Also, most UGC porn sites are infringing in someone else copyright and we just didn’t want to deal with DMCA or lawyers.

We also found criminal websites, from people trying to steal credit-card and passwords to the ugly side of online pedophilia. We had the FBI come over twice to collect evidence.

And let’s not forget link-farms. Although we had CAPTCHA and email confirmation for new websites, every once in a while someone managed to create dozens of websites in a single day all full of links to some bank, real estate agent, mortgage broker, auto dealer, etc. I’m sure the business that were benefiting from it didn’t know they hired a “black-hat” SEO.

Pretty much every Social Network-builder, website builder or content sharing site deals with the same issues we dealt with. A good number of entrepreneurs (and most investors) will be oblivious to those facts and just think that everything is going great and the growth is sustainable and proof they are creating great value and soon will be able to turn a huge profit or to sell for hundreds of millions of dollars, until someone takes the time to figure out what people are using their service for and finds out it’s really not what they thought it was.

EBay is working on software to replace the guts of Skype but is worried that it may not succeed, may lose a court battle with Skype’s founders over rights to the core technology and may need to do something drastic in the next few years. The company said in a regulatory filing yesterday that if it fails in both the legal and technical avenues it’s pursuing then “continued operation of Skype’s business as currently conducted would likely not be possible.”

Joltid, a company owned by Skype’s founders, merely licensed some of the system’s core technology to eBay when it sold Skype to the auction giant in 2005. Joltid now says that the license has been revoked and eBay is infringing on its rights by continuing to use the technology. The case is scheduled to go to court in June of 2010 but eBay is trying to replace the technology in the meantime. It may not succeed.

Joseph Galante at Bloomberg News cites Jayanth Angl, an analyst at Info-Tech Research Group, who argues that replacing the technology will not be easy. “It would be quite difficult to replace what they already have as the underlying component to their service,” Angl told Bloomberg. “There are a number of barriers to that, not the least of which are legal barriers.” The creation of another global P2P VOIP and video network that doesn’t infringe on existing patents is no small task.

Skype is one of the shiniest stars in eBay’s portfolio of companies and is aimed to spin out as an independent company that can sell its own stock in an IPO sometime soon. That’s unlikely to happen until this most important of several lawsuits the company faces is somehow resolved.

This Spring we reported that Skype’s founders were also interested in raising enough capital to buy Skype back from eBay. It’s been three months since that news was first disclosed and there have been no updates on the effort that we’re aware of.

Skype continues to grow very quickly. Now with 480 million users around the world, it is twice the size of Facebook and adding users almost as fast. Skype being gutted would cause substantial disruption to the communication of millions of families around the world.

Well, the world didn’t come to an end after the demo of the SMS bug in the iPhone yesterday by a bunch of hackers. Actually, nothing seems to have happened at all. My guess is that the hackers demoed the bug to a small audience instead of hacking hundreds of iPhones, which would have probably led to legal issues.

The good thing about this is that Apple is said to release a patch for the bug sometimes this weekend, according to the UK network operator 02.

An O2 spokesperson said the patch would be available Saturday through iTunes.

The hackers had tried to warn Apple of the consequences, and as usual, Apple had completely ignored them. Put on the spot, Apple didn’t have much choice but react and release a patch…

What’s this patch going to be? 3.1 or 3.0.1? If it is true that Apple will release a patch tomorrow, I bet that it’s going to be version 3.0.1 as I think it’s still a little early for Apple to release version 3.1. But hey, I might be totally way off.

As usual, in the event that a software update would be available this weekend, jailbreakers and unlockers should NOT update as it will remove the jailbreak/unlock.

Thank you Twitter follower @lambsypie for the tip.

“iPhone OS 3.1 Coming This Weekend?” is an article by the iPhone Download Blog sponsored by the iPhone Store. Feel free to leave a comment or discuss this topic in the forum. For the latest iPhone info, don’t forget to follow me on Twitter.

Apple recently countered against the Electronic Frontiers Foundation’s request to the US Copyright Office to make an exemption to the DMCA and permit iPhone jail breaking. Apple claims an exemption would leave a phone’s baseband processor (BBP) open to malicious hackers. From here, hackers could then circumvent data and call payments, make anonymous phone calls “desirable to drug dealers” and even initiate commands to render cell towers inoperable. The argument that phone hacking is particularly “desirable to drug dealers” and corporate terrorists is an amusing one given that Apple’s co-founders are themselves known to have experimented with phone phreaking in their youth.

It’s well-documented that Apple co-founders Steve Wozniak and Steve Jobs not only considered themselves “hackers” but also committed a number of illegal phone hacks in their early days after being inspired by John “Captain Crunch” Draper.

Draper earned his “Captain Crunch” nickname after he realized that the toy whistles packaged in boxes of Cap’n Crunch cereal created the perfect 2600 Hz tone – the same tone used on telephones with single frequency controls. From here, Draper was able to create a “blue box” that mimicked the tones used by various phone companies and was able to take control of the international phone network to make free long-distance calls.

After reading an Esquire article about Draper in 1971, Wozniak admits he then went on to create his own devices to emit similar tones and even went so far as to make a prank call to the Pope. A number of articles including one quoting John Draper go on to suggest that Wozniak and Jobs sold blue boxes out of their dorm rooms for money.

So how on earth has Apple’s playful hacker spirit manifested into such a culture of fear? While it’s true that phone hacks can be well utilized by unsavory criminals, the vast majority of iPhone jail breakers simply want to utilize 3rd party applications that are not available in the App Store. ReadWriteWeb has already covered a number of reputable applications in this category including Spotify and Google Voice.

Says EFF spokesperson Fred von Lohmann,” The culture of tinkering (or hacking, if you prefer) is an important part of our innovation economy. Many iPhone owners will be happy to choose solely from the applications that Apple is willing to approve…but if you want to pop the hood, the DMCA surely shouldn’t stand in your way.”

Photo credit for Steve Wozniak’s Blue Box at the Computer History Museum: Wikipedia User RaD man

Yesterday, Swedish music service Spotify announced their application’s submission to Apple iTunes App Store. Spotify, which already boasts over 6 million users in Europe, is somewhat of an iTunes alternative – albeit with streaming tracks instead of downloads. However, the similarity between the two services leads some to believe that Apple, notorious for booting apps that duplicate iTunes functionality, won’t approve the new Spotify iPhone application. And in another example of Apple’s totalitarianism, the company also just pulled Google Voice and other third-party Google Voice applications from the App Store.

Luckily for jailbreakers, problems like those above are less of an issue. There’s currently an open source Spotify client app available for download and the third-party GV Mobile app for Google Voice is coming soon.

Spotify for iPhone Jailbreakers

Like the official Spotify iPhone client, the third party client app called Spot, available from Cydia, also requires a Premium account in order to work. Also like the official app, Spot lets you search for songs and build playlists. However, where the official client will let you cache playlists to listen to when the AT&T; network fails or you lose your connection, the Spot application has yet to implement this type of feature according to a forum posting. That’s a big drawback, unfortunately, since the caching ability is precisely what makes Spotify feel less like a streaming service and more like a real iTunes alternative.

[youtube=http://www.youtube.com/watch?v=JR8wGK9xhfY]

There’s also another major issue for jailbreakers here in the U.S. looking to get on board with Spotify – the premium account. In order to run Spot, you need a premium account to sign into the app. However, in order to get a premium account, you have to sign up at Spotify.com, a site which currently prevents you from doing so because Spotify is not available in this country yet. So what good is an open source app if you don’t have a premium account, right?

Fortunately, there are a few workarounds for this issue. For one, you could access the Spotify web site using a UK-based (or other European country-based) proxy server. A quick Google search presented us with several options for doing so, although we won’t point to any exact resources since this isn’t exactly the most legal way of going about things. Let’s just say this: we got to the sign up page and it was only a matter of putting in our name and account details.

Another option is to purchase an account from an overseas friend who has access to the service in their country. Have them purchase the account and you pay them back after they give you the username/password. (Obviously, you’d want to go with a real friend you trust here, not some random stranger from the internet.)

Either way, getting access to Spotify via Spot is a bit more difficult than we hoped it would be, but it’s not impossible if you’re really motivated.

GV Mobile Coming to Cydia

Although there aren’t any Google Voice alternatives available just yet, we hear that one in particular is coming soon. The third-party client application GV Mobile was among the Google Voice apps just pulled from the App Store. According to a tweet from the developer Sean Kovacs, he plans to upload the latest version of the application to Cydia (“or similar”…perhaps referring to Icy) soon. You may want to follow his Twitter account for more details as to when that occurs.

For more details on jailbreaking, check out our how-to guide here.

Twitter just announced its new home page redesign complete with trending topics and search. Publicly launched at the 2006 South by South West interactive festival, users first flocked to the site as a way to communicate with friends and festival attendees. However, as we’ve seen in the past few years, the site has evolved into a multifaceted real-time tool. The community has given timely updates on earthquakes, the Iran election and we’ve even seen professional poker players bluff in real-time Tweets. Twitter has evolved into a community where users can discover breaking news and trends and the new home page certainly matches that.

Says Twitter cofounder Biz Stone in a blog post , “Demonstrating the power of Twitter as a discovery engine for what is happening right now through our Search and Trends often awakens a sense of wonder which inevitably leads to a much more compelling question, “How do I get involved?”

And it seems at this point, if you haven’t gotten involved you’ve been living under a rock. While the site always contained the ability to search and discover trends, these features were buried. Today, with the new design, all of those television viewers who refused to give into the peer pressure of Oprah and Ashton Kutcher’s hour-long Twitter tutorial will finally understand the value of the service. Twitter isn’t just an emotional weather report generator, it’s a taste of zeitgeist.

In some cases, the spirit of our times is simply our lust to win an iPhone in a Twitter sweepstakes or our willingness to spam our friends with Spymaster, and in other cases it is breaking news about the events, companies and issues that effect our lives. One of the interesting aspects of the new trends section is that unlike real-time search engine One Riot, Twitter not only offers the list of related-tweets, but it also offers a short rationale for a topic’s popularity. This contextualization makes it particularly useful for news discovery.

Those who’ve abandoned their Twitter accounts might point to the frivolity of some of the home page’s current trending topics; however, Twitter’s ebb and flow is only as silly or intelligent as our society dictates. When the President of the United States encourages you to tweet your senator to support health insurance reform, you know you should probably continue to keep an eye on this micro blogging superstar.

Available In: Cydia

Price: Free

Apple has recently started blocking applications from the App Store that allow your iPhone to use your Google Voice account with calls, text messaging, and voicemail. It seems that one developer has taken this to the next level by releasing an app in Cydia for free. I’d write all about the drama but the fact is, right now, here’s a sweet way to get a Google Voice app on your iPhone. For the record, this app is not made by Google.

The app is called GV Mobile and it’s free! The first version was crashing for me when I would log in but now, after an update, it’s working great! To make an outgoing call you dial the number or find it in your contact list. Once you send the call, your iPhone’s stock Phone app will ring. Once you answer, it will automatically call the number you called but come from your Google Voice number.

The best features of this app are access to text messaging and voicemail. I was very impressed how both apps work just like the stock Messages and Phone apps. What’s nice is the SMS feature doesn’t use up your normal text messages and even better? You can use this on a fake activated iPhone that doesn’t have service. You can’t make calls, but you can access voicemail and text messaging as long as you’re on wifi! If you try to make a call, it will ring your actuall line set up on the account and connect the call. Let us know if this will install on an iPod Touch.

Here’s a couple things I’ve noticed that could be changed. If you’re on a non activated iPhone or just on wifi, you will get no pop up alert. Also, if you don’t have a contact in your Google Voice account but you do have it on your iPhone, it won’t show up in the Google Voice app when receiving a text message. Another thing is you can’t copy or forward SMS messages. You also can’t move around with the magnifying glass when typing a text, so if you mess up, you have to delete all the way back… I’m sure they’ll get this cleared up eventually. We’ll see how Apple & Google respond to this.

My Name is E appeared earlier this year with a product which sounded familiar to most. It enables you to collect all your social and contact accounts – on Facebook, LinkedIn, Twitter and any other network – in one spot. However, the twist was that you could share them in real life with people you met over the mobile web or their “Connector”, the USB product they also sell. Today they’ve released an app for the iPhone which lets you share your card with the flick of your iPhone-holding hand. Could this be the final death of the business card? I doubt it, but this is going to be a pretty interesting product to watch.
The Connector is not dissimilar to Poken in some respect, but as well as the wireless USB device it also lets you exchange cards between any mobile via the mobile web. The new iPhone application allows card sharing through a simple flick of the wrist towards another iPhone with the app. E then connect both users and make sure they get automatically connected on the selected social networks as well.

A few months from now, Yahoo’s search engine will be “powered by Bing.” After months of back and forth between Microsoft and Yahoo, the two companies finally announced a deal today that will bring Microsoft’s search engine to Yahoo’s properties, while Yahoo will become the sales force for both companies’ premium search advertisers. Barring any roadblocks from industry and government regulators, this deal will grant Microsoft an exclusive license to Yahoo’s core search technologies for 10 years. Yahoo expects that this deal will increase the company’s cash flow by about $275 million.

Microsoft Gains Market Share for Bing, But What’s in it for Yahoo?

At its core, this agreement means that Yahoo has given up on its search engine business. Microsoft will be able to increase its market share in the search engine and search advertising market. Yahoo will receive revenue from Bing searches generated on Yahoo’s sites and become “the exclusive worldwide relationship sales force for both companies’ premium search advertisers.” What remains to be seen, though, is what will happen to Yahoo’s investments in interesting search technologies like BOSS and Search Monkey. Integrating these technologies, which are tied to Yahoo’s search engine, could prove rather difficult for Microsoft. We will also have to wait and see what’s going to happen to Yahoo’s search APIs.

If anything, the Yahoo Search team will probably not be too happy to hear Yahoo suggest on its blog that Yahoo used to offer a “great” search experience but that Bing will offer an “awesome” one. In a call earlier this morning, Yahoo CEO Carol Bartz announced that some employees from the Yahoo search team will move to Microsoft, while others will move to the display business.

Creating Competition for Google

As we pointed out before, we think Bing is a worthy competitor to Google’s search engine, which both Microsoft and Yahoo try not to mention in all their press materials but whose shadow obviously looms large over this deal. Advertisers aren’t likely to spend a lot of money on a search engine that only commands less than 10% of the market, but once combined with Yahoo Search, Bing could easily reach 20% or more. At this point, advertising on Bing becomes far more interesting.

In a taped video statement Microsoft’s CEO Steve Ballmer argues that the agreement will bring choice back to consumers (a Silverlight version is embedded below, a WMV version is available for download here). We can’t help but note that consumers always had lots of choices with regards to search engines – in the past, most just didn’t make the choice Ballmer would have preferred.

It’s important to note, though, that neither Microsoft nor Yahoo seem to have worked out all the details of this deal, and that users won’t see any changes before early 2010. The companies expect the agreement to be reviewed by industry and government regulators before this.

The Details

Here are the details of the search/ad pact between the two companies, according to this morning’s press release:

• The term of the agreement is 10 years;
• Microsoft will acquire an exclusive 10 year license to Yahoo!’s core search technologies, and Microsoft will have the ability to integrate Yahoo! search technologies into its existing web search platforms;
• Microsoft’s Bing will be the exclusive algorithmic search and paid search platform for Yahoo! sites. Yahoo! will continue to use its technology and data in other areas of its business such as enhancing display advertising technology.
• Yahoo! will become the exclusive worldwide relationship sales force for both companies’ premium search advertisers. Self-serve advertising for both companies will be fulfilled by Microsoft’s AdCenter platform, and prices for all search ads will continue to be set by AdCenter’s automated auction process.
• Each company will maintain its own separate display advertising business and sales force.
• Yahoo! will innovate and “own” the user experience on Yahoo! properties, including the user experience for search, even though it will be powered by Microsoft technology.
• Microsoft will compensate Yahoo! through a revenue sharing agreement on traffic generated on Yahoo!’s network of both owned and operated (O&O;) and affiliate sites.
• Microsoft will pay traffic acquisition costs (TAC) to Yahoo! at an initial rate of 88% of search revenue generated on Yahoo!’s O&O; sites during the first 5 years of the agreement.
• Yahoo! will continue to syndicate its existing search affiliate partnerships.
• Microsoft will guarantee Yahoo!’s O&O; revenue per search (RPS) in each country for the first 18 months following initial implementation in that country.
• At full implementation (expected to occur within 24 months following regulatory approval), Yahoo! estimates, based on current levels of revenue and current operating expenses, that this agreement will provide a benefit to annual GAAP operating income of approximately $500 million and capital expenditure savings of approximately $200 million. Yahoo! also estimates that this agreement will provide a benefit to annual operating cash flow of approximately $275 million.
• The agreement protects consumer privacy by limiting the data shared between the companies to the minimum necessary to operate and improve the combined search platform, and restricts the use of search data shared between the companies. The agreement maintains the industry-leading privacy practices that each company follows today.