Blue may not like what Burch has to say about her online, but when does obsessive Wikipedia editing cross the line into stalking? She'd have good grounds for a libel suit if it were standard defamation. Or if it were false — one of Burch's claims is that her legal name has not always been Violet Blue, but Wendi Sullivan Blue. But she's not claiming libel, and Blue's Internet presence extends way beyond a paltry Wikipedia entry about her.

Let's guess how it will play out: Armed with a posse of Internet yaysayers, Blue will complain that no, really, she's so threatened by a single page on the Internet that she's willing to go to court to block anyone whose edits upset her. We may as well give her a SXSW panel now.

Violet Blue's complaint:

(Photo via Violet Blue)

Sam Altman, Loopt's CEO and chief popped-collars officer, apologized — "Sorry, everyone. My bad". This morning, Loopt had kept the offending friend-adding feature turned off, and promised a new release that would make sifting the real friends you want to track obsessively from the chaff you just keep on your contacts' list just so caller ID can help you avoid their calls. Those Loopt pre-launch test cases must have assumed we were all way tighter than that.

(Photos by misbehave/Graham Ballantyne)

Yang simply does not want to sell of his search business wholesale and wants a second chance to try to revive Yahoo, with him or people picked by him and the board, despite his inability to do so thus far. He would sell Yahoo whole if that’s the only choice.

But while Yang "simply does not want to sell of his search business" Microsoft said yesterday that

Mr. Bostock called Steve Ballmer’s office to arrange a call. On that subsequent call, Mr. Bostock told Mr. Ballmer that “with substantial guarantees on the table and an increase in the TAC (traffic acquisition cost) rate, there are the pillars of a search only deal to be done.”

After hardly participating in negotiations with Microsoft at all during the first few months of this ordeal — and subsequently watching Yang blow the negotiations — Bostock now seems to be the only guy at Yahoo talking to Microsoft. Problem is, he can't convince the co-founder and CEO Yang to go along with any of his ideas. What with corporate raider Carl Icahn trying to have his way too, no wonder Microsoft wants a new Yahoo board and new Yahoo management. Microsoft CEO Steve Ballmer can be a little tyrannical, but he's no Kim Jong-il in need of six-party talks. (We would love to see him wearing the shades.)

That's precisely why Facebook hired her as COO — to address similar problems, as Facebook's advertisers have grown more and more noisy in their complaints about the site's broken billing systems. How cleverly devious of Armstrong: He gets to puff his chest out and claim he's solving Google's problems, while quietly casting the blame on an internal rival who departed for the competition.

As early as September 2007 — when analysts began wondering how long it would be before VMware's market capitalization would outgrow EMC's — rumor had it a rivalry of intense personal animosity was brewing between Greene and Tucci. Tucci supposedly disdained Greene's intense managerial style, one that would, according to Vance, have employees "going into meetings with Greene and crawling into their foxholes, hoping to avoid being struck by criticism or worse, a tirade." Vance posits that as VMware grew to be EMC's growth engine, Greene got too heady in her power and turned some of that intensity toward her sort of, kind of, not-really-because-he-needs-me-more-than-I-need-him boss, Tucci. If so, it's hard to think of anyone more deserving, since Tucci's no wallflower himself. Anyone have good Greene stories? Or Tucci tales? Send them in. (Photo by AP/Risberg)

I'd make a "so meta" joke here, but apparently you pseudomodernists are beyond that by now. In a further twist, site creator Ed Hunsinger is perfectly within his rights to un-unpublish work from Boing Boing under the site's Creative Commons license noncommercially, as long as it's properly attributed — though that does shut him out of turning his traffic into pageview gold with ads brokered by, say, Boing Boing band manager John Battelle's Federated Media. Yes, the wheel in the sky keeps on turning.

As a human being with a soul in there somewhere, I've avoided blogging about the Xeni-Violet scandal. But as a wannabe comedy writer, I found myself obsessively poring over the 1,200-plus Metafilter comments on our report. I'd forgotten why I love-hated Metafilter: It's a boyzone of spiteful, pseudonymous insult comics, but many are snappy with the English language. "Instead of calling it what it is, they're going to clown us with semantics." Red meat for you guys at MeFi: The "homophobic" headline on yesterday's post was added by big gay Owen Thomas himself. Discuss.

2001 and 2002: With the emergence of "the warbloggers" post-9/11, as they were called, everyone feuded with everyone. Seriously. Everyone! (N.B. that account includes some serious misreading.) It was sheer chaos, a mass freakout that distended psychoanalytic space and time. There were even Denial of Service attacks. Dave Winer, the feudiest of all internetters, took on the world, briefly.

You won't click all those links, so just read the one where Instapundit agrees with Denton.

(Photo via Wonkette)

As new media gets big, it remains small at heart — and not in a good way. Boing Boing, the popular tech-culture blog, has offered a tardy defense of its mass deletion of posts mentioning a sex blogger from its archive, and it amounts to this: Because Boing Boing started as a personal blog, it's entitled to be as petty, as hypocritical, and as inconsistent as a 14-year-old girl with a MySpace page. Never mind the fussing about so-called "censorship" — though one would be sure that, had this happened at another website, we'd be reading all about it at Boing Boing, with its editors in a righteous nerd froth. The excuse that "it's personal" would ring more true if we weren't talking about a media enterprise whose audience exceeds that of Conde Nast's Epicurious.com, or the publicly traded finance site TheStreet.com. While Boing Boing's revenues are unknown, the site formed the cornerstone of Federated Media, an online-advertising startup which has already made founder John Battelle — Boing Boing's "band manager" — a multimillionaire. Oh, and did we mention that Violet Blue, the sex blogger in question (and contributor to Gawker Media's Fleshbot), shown here at right, used to be the lover of Boing Boing editor Xeni Jardin, left?

Some have speculated a love triangle or some other romantic crash-up might be at the heart of the blog spat. The only name in circulation is Kevin Sites, a war reporter that Boing Boing's Xeni Jardin got into blogging in 2003. Did Blue have her eye on Sites? Given that she blogs her own love affairs, including her own despair that she can't blog more about them, and her love affair with Jardin herself, it's doubtful that this triangle is so well-concealed the prolific Blue wouldn't have dropped a Flickr of a hint somewhere.

A more likely inspiration, though more pedestrian, is that Blue's move to trademark "Violet Blue," once her pseudonym and now her legal name, ran afoul of Boing Boing editor Cory Doctorow's self-avowed obsession with destroying intellectual property law as we know it. A Northern District of California Court granted author Blue an injunction against the porn performer Violet Blue at the end of May 2008, but the trademark filing itself was in 2007 — about a year ago, which is when Boing Boing claims that the posts mentioning Blue were first unpublished.

But there's one more very likely reason why Boing Boing's editors might have decided to wash their hands of Blue: Her desperate coattail-riding. Before this dispute, Blue had been known to call herself "the fifth Boing Boinger." That's more than a stretch. A crucial point lost in the discussion is that the posts in question, save one, were not actually written by Violet Blue, a fact that bolsters Jardin's take:

This is a directory of wonderful things. If we no longer think something is wonderful, we have every right to remove it from this directory.

A bit harsh, maybe. But reputations have been made on the backs of a Boing Boing link, and Blue is no exception. Even this controversy is now serving to further her career.

This last explanation seems to fit best. But if Blue's ladder-climbing was the issue, why not say that? That hardly seems personal; it's simply business. As it stands, Boing Boing's editors come off looking foolish with their vague pomposities: "Violet [Blue] behaved in a way that made us reconsider whether we wanted to lend her any credibility or associate with her." They want to retain the authenticity of a "personal" blog, with all its quirkiness, to attract an audience discontented with impersonal big media, while claiming that it's too "personal" to explain an editorial decision to that audience. If Boing Boing's readers expect better of it, its editors only have themselves to blame.

(Photo by Jacob Appelbaum)

Had an email last night from someone who I really respect chewing me out completely due to a business deal with a competitor. To be precise, not just chewing me out, full blown FU I'll never talk to you again.

Sounds like "Bang Bang" Michael's silver banhammer strikes again.(Photo by Sue Waters)

Zivity has been accused of using female sexuality as a ploy to get attention. A ploy, or a business model, one might ask. Mary Hodder, founder of online video startup Dabble, wrote, "It's not that we object to porn, just to the using (or appearance of using) girl geeks to get back their cred. Even if that's not what's happening from their perspective, the rest of us who would like to *not* be sexualized and objectified in our work lives really find the Zivity association disconcerting."

So maybe it is impossible to separate selling images of female sexuality from the sexist tech scene, but when it comes to the question of objectification, Banister objects. "I don't think the opinion that Zivity demeans anybody is one that's held by the majority," she told Valleywag. "I'm a tech vet, and I used to be very similar — you want to strip your sexuality and just live in your brain, and be a talented, smart individual so you can compete in a male-dominated space. You become sexless — but why can't I be both? Why can't I be beautiful and sexy and be smart?"

And a legitimate executive. Zivity isn't just another porn site aping MySpace, which is precisely why it's threatening. Zivity has a Silicon Valley pedigree, which means for the first time, a company that openly embraces female sexuality is rubbing shoulders with Valley oldtimers and chasing Valley money — $8 million in venture capital so far. When female entrepreneurs feel as if they have to fight for equal time as it is, sharing space with Zivity is tantamount to being asked to sleep with the enemy.

But for women, the enemy in this case isn't porn: It's turning against each other based on what's between our own legs. Is it any woman's fault that tech pundits don't give women a fair shake? "I think there's a lot of resentment for how much coverage we get," said Banister. "But we did place at TechCrunch40, and we're venture funded — and it's not just because I took my top off. The investors and the press aren't that naive."

Nor are we. Banister didn't mention it, but Banister's husband Scott was an early employee at PayPal, and some of the funding came from Peter Thiel, Scott's former boss. Part of Zivity's assumption-challenging reality: The Valley's most prominent gay venture capitalist is helping women make money undressing.

Banister told us that though she offered to bow out of the speaking opportunity, the Bay Area Girl Geeks asked her to stay. Dinner organizer Angie Chang told a San Jose Mercury News blogger:

We invited Cyan to give a 3-5 minute introduction as she was voted Sexiest Geek Alive in 2000 (just like Ellen Spertus of Google won the award in 2001 — Ellen was invited by Google to give the intro talk at the first Bay Area Girl Geek Dinner). Cyan is also the cofounder of a Series A funded technology startup, which I respect greatly as a female tech entrepreneur myself.

That is, if embracing women in tech is really about changing the rules, then all women have to have a seat at the dinner party. Even if you don't approve of what they do for a living.

(Photo via takeitez)

Commagere, in the past, hasn't helped clarify matters. Last year, he told GigaOm that RockYou hosted his applications and provided some cross-promotion, then hastened to give the company more credit:

At this point I’ve partnered with them on the app and they are contributing far more resources than just infrastructure. It’s eased my pain of looking for more programmers and I’m now enjoying being able to focus more on the creative aspect of it.

He must now regret those comments, which won't help his case in breaking free from RockYou — if that's even his goal. Talk about your words coming back to bite you.

Kind of like that anonymous complaint about eBay's anticompetitive practices in Australia "accidentally" displaying data which identified Google as the author. If the conspiracy theorists are right about Google blocking access to PayPal through App Engine intentionally, then why not just say that turnabout is fair play after eBay pulled similar stunts to keep Google Checkout off the auction site? That seems easier.

1. Given the growing reliance on online activism by civic organizations, how will Google ensure that it does not abuse the near 90% share of the search market it will most certainly control if it aligns with Yahoo!, which could allow the company to control how Americans access information on key issues?

2. Google has in the past been accused of using its search algorithms to favor certain search results over others. Such accusations are of particular concern to Hispanic-owned small businesses that rely on Internet search for a competitive equalizer in a marketplace dominated by large corporations. How will a company with 90% control of the search market allay fears that small businesses will lose this valuable economic resource?

3. Privacy advocates such as the Electronic Privacy Information Center and consumer groups like US PIRG have raised serious concerns about Google's privacy policies and practices - concerns that are doubled by the proposed deal that would give Google near-total control of the online search market. For Latinos considering subscribing to broadband services, worries about privacy - along with child safety and content filtering - are determining factors. How quickly will Google move to address these concerns?

4. During review of its acquisition of DoubleClick, Google pledged to alter several of its information-gathering techniques to address privacy concerns, including its use of "cookies" to track users' surfing habits. And yet the company has opposed an array of privacy regulations ranging from state laws in New York and elsewhere to adoption of FTC self-regulatory principles. Is Google now backing away from the pledges it made to usher along the approval of the DoubleClick deal, and will it take a similar tack when attempting to gain antitrust approval for the Yahoo! pact?

5. Cyberlaw scholars have noted that Google's disclosure of its privacy policy, which is not easily accessible from the company's home page, may be in violation of California state law. For Hispanic Internet users - the fastest-growing online population in the country - it is critical that privacy policies and other terms of use are readily disclosed, particularly to users who are new to the Internet. How will Google ensure that its disclosures comply with basic common-sense consumer protection principles?

From: Matthew Greeley

Sent: Wednesday, June 04, 2008 6:04 PM

To: BI_MAILALL

Subject: Salesfarce Waddles into the Innovation Management Market...

Dear BI Team,

This week, Salesforce.com began their push in earnest, to cut into our market share of the On-Demand Innovation Management market, including running print ads in the Wall Street Journal and BusinessWeek. This comes as no surprise to our executive team, as our internal intelligence group has been expecting this since mid 2007.

We've also heard that salesfarce ground troops are requesting conversations and sit downs around “Collaboration Initiatives”, at several of our clients. They may be in for a surprise when they get there and learn we have already locked-in multi-year subscription deals, negotiated enterprise licensing and that our customers actually like us.

Salesfarce, is not the juggernaut it once was, as a few recent developments point out:

- Their ex-Chief Strategy Officer Tien Tzuo, aka "Benioff's Brain" resurfaced this week as the CEO a new start-up (Zuora). Tzuo is largely credited as the marketing genius behind much of sfdc’s growth and past success.

- On the Q1 conference call, they announced Differed Revenue was down sequentially for the first time in company history. This single metric is strongest leading indicator about the future of a subscription business. (By contrast our diff revs grew over 50% during the same period).

- Their Innovation Management solution is a set of generic project management widgets cobbled together to try to cover the areas our best-of-breed products address. These widgets have no interaction, and the design is based on little or no knowledge about the actual process of innovation. Even if they get it to work at some point, they are skating to where the puck was, instead where it's going to be.

You can expect their uber-slick sales force (pun intended) will be quick to brew up some ugly batches of fear, uncertainty and doubt about BI. In fact, we already have reports of them making false claims about us in the marketplace. This is the classic tactic of a company that has gotten too big for their own good. Covering up an inability to innovate by intimidating customers spending more on marketing.

Fortunately, for us, our customers are innovators themselves, and the ability to see things as they really are, often comes with the job title.

Please let your clients know that we welcome a side by side comparison. Our products are NOT apples to apples. This month I have heard feedback — literally from around the globe — that WebStorm 5 is the most advanced tool of its kind available today. Our outsourced datacenters deliver the same standard SAS70 Type II reliability and disaster recovery at a third a cost of their proprietary systems, and we have more customers, more deployments, more revenue and faster growth in this category than any other vendor.

Salesfarce has gotten fat and happy with their past success in SaaS, and like any over-reaching empire, they have eroded from within. Their twilight has come. I believe a slight nudge is all that will be necessary to send this rotted shell of a business —devoid of the virtue of true innovation— crashing into the ground.

I hope you will join me in delivering that nudge over the coming months,

Matt

________________________________________________________

Matt Greeley

President & CEO

Brightidea.com :: Powering Ideas to Reality™

www.brightidea.com

But it's clear they're talking about Cook, who they identify, rather insultingly, as "a former systems administrator." The post brags about "a recently enhanced staff of amazing systems engineers formerly of Google, IBM, and other high-profile technology companies." That, too, is an obvious dig at Cook, who's mostly worked at startups.

But the friend of Blaine who emailed us about Twitter's outage puts the blame on an "operations guy" at Twitter, whom he describes as a "fucking moron." He writes:

The whole story is that it takes more than just Blaine to keep Twitter up and running and whether servers are up, properly configured and not running hot definitely doesn't fall under the developers' responsibilities.

The other part of the dispute was whether Twitter needed to be rewritten in another programming language. Perhaps, but that wasn't the real issue in scaling, according to the Cook camp.

We're utterly unqualified to evaluate the technical arguments here. But the back-channel badmouthing that's going on here? We're experts at that, and we rate it utterly delicious. As fingerpointing goes, this Twitter battle takes the prize.

The file had an electronic stamp showing it was generated from a Microsoft Word document titled ""ACCC Submission by Google re eBay Public 2.DOC." So much for the secret jab. Google runs its own payments service, Google Checkout, and the PayPal rivalry is often intense. Last summer, Google planned a Boston Tea Party to promote Checkout to merchants during the eBay Live conference in Boston. eBay complained and, even though Google canceled the event, eBay pulled its advertising from the site for several weeks.

Schrage, we hear, strongly opposed Simon's hiring as a consultant for the launch of the then-secret Googlephone — the collection of wireless software now known as Android. And Schmidt's extramarital relationships, first with Simon and later with Kate Bohner, were a source of friction between him and Schrage, not because Schrage disapproved, but because it hurt the company's image. Or so I've heard. I've run into Schrage twice at the conference, and he's made noises about talking to me, at which point I'll ask him directly about all this.

That's not the only run-in Schrage and Simon have had, though. Before taking her current gig at Thomson Reuters — one that Thomson Reuters PR staff are not very happy about — Simon made a strong play to take over PR at Facebook. She was not very gently rebuffed, and Schrage landed the job instead.

And yet here we see Schrage, smiling, or faking a smile, as he catches up on email as Simon and Wojcicki catch up. His new bosses at Facebook should be pleased they've hired someone so skilled at putting on appearances.

We do have a no video policy inside the ballroom as we don't have video rights to all stuff we show, so we have to do that. but we say it explicitly in the program and in notes to reporters and bloggers, so they should know. It's easier to gin up a controversy.

Waldman's complaint: Using a (now-offline) anonymous Twitter account, @confess, a user called Waldman a "crack-whore," and mockingly congratulated her for having "graduated to soft-core lesbian porn!" When Waldman asked Twitter's team to warn or remove the user, founder Jack Dorsey declined, on the grounds that "we've reviewed the matter and decided it's not in our best interest to get involved." Waldman believes Twitter owes it to their community to do just that, and got them involved instead.

She took the dispute to her blog, instantly become a cause célèbre — with 700 comments, 2,000 Diggs, and a raging debate on customer-service discussion board Get Satisfaction.

As CNET's Caroline McCarthy observed, "in the bubble-like culture of Web 2.0, Waldman is a sort of celebrity — and with celebrity comes scrutiny and often ugly commentary." Attention magnifies attention. Now Waldman's an even larger public figure, and therefore target — and sure enough, she's been called a whore a whole lot more after the incident than before.

Being called a "whore" online is one thing, but being called one in connection with one's search results? This may be Waldman's deeper gripe. "Anyone can use Twitter to consistently harass you and ruin search results for your identity," she writes. Twitter enjoys a stratospheric rank in Google's search results, making it a favorite in the world of social media marketers — the world in which Waldman works. But the spat has only strengthened the associations between Waldman's good name and the bad ones she's been called, from the all-powerful Google algorithm's point of view.

For a few, this reporter included, getting the mantle of "whore" tossed atop one's search results might be a value add, but for most, it's a detractor from the business at hand. What hurts Waldman as much as the misogynist namecalling is that potential business partners will see a social-media expert who's bad-mouthing a rival service to shame it into managing her online reputation for her.

(Photo by adactio)

"We had a feast and all turned out well," reports CollegeHumor cofounder Ricky Van Veen, who described the buffet as "pizzas, mozz sticks, and wings". Nobody tell Facebook's ex-Google chef Josef Desimone, though, as we have a sneaking opinion the mozzarella wasn't organic and locally sourced from within a 100-mile radius. (Photo by Ricky Van Veen)

We've been known creative tagging for comedic purposes ourselves, but in this case, doth Wired protest too much? Perhaps so. Asked if "ButtMunch" was Wired's internal nickname fro Arrington's site, business editor Dylan Tweney said, "I don't think it has come into general usage around the Wired.com office. We can always hope, though."

When eBay's then-CEO Meg Whitman was wooing Craigslist founder Craig Newmark and CEO Jim Buckmaster, she was so nice! She even promised that they'd get lots of playdates on the board with dreamy eBay founder Pierre Omidyar, and Newmark and Buckmaster believed her when she said Omidyar held the same Sunday-school values they did:

Mr. Newmark and Mr. Buckmaster were impressed by Ms. Whitman's presentation; most notably the importance to eBay of its community and eBay's dedication to Pierre Omidyar's Community Values — particularly the values that "We believe that people are basically good;" "We believe than an honest, opn environment can bring out the best in people;" and "We encourage you to treat others the way you want to be treated." These were very similar to craigslist's own principles and, in reliance on eBay's expressed commitment to these principles, along with Ms. Whitman's representations, craigslist agreed to resume discussions.

At the time, eBay did not disagree with Craig's impression, but instead enthusiastically embraced it. For example, when Mr. Price [Ed. Note: Garrett Price, VP of new ventures] of eBay (who witnessed virtually all of the negotiations involving the transaction) was provided a late draft of Craig's blog entry, his response was "[I] Love it." However, eBay did not post a link to Craig's blog entry on its own website once the transaction had closed, as eBay had promised it would.

And that was only the start of eBay's bullying behavior. Included in the complaint is a screenshot of text ads on Google that Craigslist offered as evidence of eBay's trademark infringement, false advertising and anti-competitive practices.

Of course, none of this will be settled any time soon — a case management conference isn't scheduled until October 10. And based on how nasty this is getting, I doubt a settlement — at least one not involving lollipops — will be reached anytime soon.(Photo by AP/Jeff Chiu)

May 3, 2008

Mr. Jerry Yang
CEO and Chief Yahoo
Yahoo! Inc.
701 First Avenue
Sunnyvale, CA 94089

Dear Jerry:

After over three months, we have reached the conclusion of the process regarding a possible combination of Microsoft and Yahoo!.

I first want to convey my personal thanks to you, your management team, and Yahoo!'s Board of Directors for your consideration of our proposal. I appreciate the time and attention all of you have given to this matter, and I especially appreciate the time that you have invested personally. I feel that our discussions this week have been particularly useful, providing me for the first time with real clarity on what is and is not possible.

I am disappointed that Yahoo! has not moved towards accepting our offer. I first called you with our offer on January 31 because I believed that a combination of our two companies would have created real value for our respective shareholders and would have provided consumers, publishers, and advertisers with greater innovation and choice in the marketplace. Our decision to offer a 62 percent premium at that time reflected the strength of these convictions.

In our conversations this week, we conveyed our willingness to raise our offer to $33.00 per share, reflecting again our belief in this collective opportunity. This increase would have added approximately another $5 billion of value to your shareholders, compared to the current value of our initial offer. It also would have reflected a premium of over 70 percent compared to the price at which your stock closed on January 31. Yet it has proven insufficient, as your final position insisted on Microsoft paying yet another $5 billion or more, or at least another $4 per share above our $33.00 offer.

Also, after giving this week's conversations further thought, it is clear to me that it is not sensible for Microsoft to take our offer directly to your shareholders. This approach would necessarily involve a protracted proxy contest and eventually an exchange offer. Our discussions with you have led us to conclude that, in the interim, you would take steps that would make Yahoo! undesirable as an acquisition for Microsoft.
We regard with particular concern your apparent planning to respond to a "hostile" bid by pursuing a new arrangement that would involve or lead to the outsourcing to Google of key paid Internet search terms offered by Yahoo! today. In our view, such an arrangement with the dominant search provider would make an acquisition of Yahoo! undesirable to us for a number of reasons:

•
First, it would fundamentally undermine Yahoo!'s own strategy and long-term viability by encouraging advertisers to use Google as opposed to your Panama paid search system. This would also fragment your search advertising and display advertising strategies and the ecosystem surrounding them. This would undermine the reliance on your display advertising business to fuel future growth.

•
Given this, it would impair Yahoo's ability to retain the talented engineers working on advertising systems that are important to our interest in a combination of our companies.

•
In addition, it would raise a host of regulatory and legal problems that no acquirer, including Microsoft, would want to inherit. Among other things, this would consolidate market share with the already-dominant paid search provider in a manner that would reduce competition and choice in the marketplace.

•
This would also effectively enable Google to set the prices for key search terms on both their and your search platforms and, in the process, raise prices charged to advertisers on Yahoo. In addition to whatever resulting legal problems, this seems unwise from a business perspective unless in fact one simply wishes to use this as a vehicle to exit the paid search business in favor of Google.

•
It could foreclose any chance of a combination with any other search provider that is not already relying on Google's search services.

Accordingly, your apparent plan to pursue such an arrangement in the event of a proxy contest or exchange offer leads me to the firm decision not to pursue such a path. Instead, I hereby formally withdraw Microsoft's proposal to acquire Yahoo!.

We will move forward and will continue to innovate and grow our business at Microsoft with the talented team we have in place and potentially through strategic transactions with other business partners.

I still believe even today that our offer remains the only alternative put forward that provides your stockholders full and fair value for their shares. By failing to reach an agreement with us, you and your stockholders have left significant value on the table.

But clearly a deal is not to be.

Thank you again for the time we have spent together discussing this.

Sincerely yours,

Steven A. Ballmer
Chief Executive Officer
Microsoft Corporation

But her dismissive tone strikes me as disingenuous. Had Lacy landed an exclusive with Twitter cofounder Evan Williams on the financing, wouldn't we be reading a breathless analysis in BusinessWeek on how microblogging is the next big thing? Perhaps there's something else going on here: Lacy was much abused by Twitter users during a poorly received keynote at the SXSW conference. Can one blame her if she's now shooting the messenger?

As a bonus, the 100-word version of Lacy's post:

Twitter has raised between $15 m and $20 m according to CNET. Scrambling around trying to get the scoop. I haven't. Twitter raising a fat round of venture capital is in no way surprising. As I've reported, anyone who has a good Web business is bulking up on cash. If you read between the lines Evan Williams has essentially previewed this deal. Anyone even bringing up the lack of business model has no basic understanding of how Silicon Valley works right now. As is written about to death in my book. At any price, a stake in Twitter — not to mention a chance to cozy up to a true Web visionary in Evan Williams — is a steal. I've wasted a long post telling you why.

Zuckerberg and Moskovitz are both known to be stubborn and to argue vociferiously for their ideas. It's hard to imagine a disagreement that would cause a permanent rift.

This split appears to have something to do with the pair's Harvard history. A clue lies in a 2005 Denver University newspaper article about Facebook. In it, Moskovitz's title is given as "No Longer Expendable Programmer." Clearly an inside joke, but where did it come from? We hear that Zuckerberg referred to Moskovitz as "expendable" and "a soldier" in IM conversations turned up during Facebook's long-running lawsuit with the founders of rival social network ConnectU.

That lawsuit was reportedly settled earlier this month. Moskovitz was clearly familiar with the "expendable" remark. The feud is, insiders tell me, only goes back a month. How to explain these facts? Here's a theory: Back in 2005, Zuckerberg must have convinced Moskovitz to laugh off the slight. Could the final stages of the legal process turned up evidence that persuaded Moskovitz Zuckerberg wasn't joking?

If so, Zuckerberg may face a lonely future. Chris Hughes, the only other person Zuckerberg acknowledges as a cofounder, left Facebook to work on Barack Obama's campaign. Andrew McCollum and Eduardo Saverin, two Harvard classmates sometimes identified as cofounders, have long been out of hte picture. Moskovitz is the only person who has been with Zuckerberg since the beginning, the only comrade who remembers Facebook's long march out of collegiate obscurity.

Google's Larry Page and Sergey Brin made a pact to work with each other for 20 years. In two decades, who will Zuckerberg have in his trusted inner circle? Or does he view everyone around him, as he once labeled Moskovitz, as "expendable"?

Before he left, Pann rewarded his team for all of Panama's renowned successes with promotions for one and all. Now Morrissey is stuck with power-tripping incompetents, our tipster suggests, who "rarely spoke to any customer during Panama and caused disaster."