Can Digsby find its way back into the light?

These days, a single blog post can threaten a small business' existence. A good example is dotSyntax, which makes the multiprotocol IM client Digsby. An entry in Lifehacker entitled Digsby Joins the Dark Side, Uses Your PC to Make Money has ignited a small storm among Digsby users -- and probably within the dotSyntax offices as well.

First, an admission: I use Digsby on a daily basis as an IM client and have, on the whole, been quite satisfied with it. I moved to Digsby because, unlike my previous client Trillian, it offered a way to monitor my e-mail and Facebook feeds as well. (Note: Trillian has recently begun beta testing a new version with those features.) So I'm not a completely objective viewer.

Lifehacker's blog post, which went live yesterday afternoon, urged its readers to uninstall Digsby if they used it because the product not only prompted people to accept six pieces of third-party applications during the install, but used the processing power of users' computers to run research projects without informing their users. "The only way you are definitely going to avoid greedy software developers exploiting you is to stick with open source," the blog post concludes, "make sure to donate to your favorite open source projects, and stop installing software with bundled crapware."

User reaction was immediate. Many, quite naturally, declared that they were going to abandon Digsby in Lifehacker comments, on Twitter, and no doubt on other forums.

However, the reaction from dotSyntax was immediate as well.

Early this morning, the company published a long (and, I've got to say, well-written) blog entry explaining of how it had tried to avoid the typical small-company revenue model of "free version with ads, paid version without" by placing the third-party offers in the installer and by employing the research module. The entry went on to explain how dotSyntax had erred by not being open about the module (it had been mentioned it in the company's blog and there was a paragraph about it in the EULA, hardly obvious places), and what changes were immediately being put in place.

The company ended with a poll and a solicitation of comments on what kind of revenue model its users would prefer: The current one? An ad-based one? Or something they haven't thought of?

By responding so quickly, and by being respectful of its users' feelings on the matter (rather than simply being defensive), dotSyntax may have succeeded in pulling the fat out of the fire. Among the angry posts and vows to uninstall Digsby on  Lifehacker's comments page and on the Twitter feed are others pointing to the Digsby blog entry. And the comments on the Digsby blog show a variety of opinions.

My thoughts? Considering that a large number of their users are fairly tech savvy, it was unwise, to say the least, for the folks at Digsby to introduce the research module without letting everyone know. The company pushes announcements to its users every time there's a major change; this should definitely have been one of them. And as far as the third-party "offers" during installation (which were instituted after I began using Digsby) -- they may add to the company's bottom line, but they also add an air of sleaziness (especially since many of those apps aren't much better than malware).

That being said, from what I can see, dotSyntax has met this crisis well -- it has immediately taken steps to rectify the situation by making the opt-out for the research module more obvious (according to the blog, it plans to push through an update later today that will make these changes), and is actively soliciting its users' advice.

As a result, I'm going to keep using Digsby -- at least, for now. Everyone makes mistakes; it's how they respond to those mistakes that can sometimes be even more informative.