Back in April, we noted that a clueless VC had dumped $40 million into a company that was widely hated for their spyware. Now, in an article that certainly doesn't do any favors for anyone's impressions of the VC industry, a venture capitalist tries to divide the spyware/adware/malware offerings into the "nine levels of hell" and admits that anything above level 3 may be okay for VCs. It's obviously slightly tongue-in-cheek, but the point remains that certain VCs (including the writer of the article) think that even if the way you make money is by tricking users, it's ok. A smart VC with a long-term view would realize that tricking users is never a long-term strategy that will succeed. The point she is really trying to make -- which she unfortunately buries all the way at the end -- is that if users want adware, they should be able to install it themselves. This is the position we've taken here as well. We agree that many of the anti-spyware laws go way too far, in that they confuse two issues: (1) is the spyware being disclosed to the user and (2) should it be able to put ads next to competitor web sites. The real problem with spyware is that first issue. However, for the few people who actually do want to install these programs, they should be free to. Unfortunately, the sneaky tactics most of these programs use, shows just how much real demand they have. It's too bad that this article mostly brushes over how sneaky most spyware programs are in how they are installed, and focuses more on the competitive ad products. In the end, it makes her look like she's defending Claria, when her final hedging shows she would never invest in the company anyway (since Gator is often installed without the user knowing it, and uses popups -- both of which she deems below the levels of hell where she'd invest).
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