"I met Rebecca two years ago," said Ms. Von Furstenburg. "She came to visit me. She told me all about her. She told me how she had to flee her village. So I told her, I have a village too, on the fourth floor."

Evidently, the designer invited Ms. Lolosoli for some fun in the studio, making jewelery that would later be shown on the spring catwalk and sold in stores. Lolosoli, who was in attendance at the conference, didn't seem to be having that much fun on the night. The Observer later overheard her throwing a tantrum to her staff-minder, saying she wanted to skip dinner and conversation with Bill Clinton in favor of a night in her hotel room with the remote control.

Elsewhere, air kisses and smoke-blowing abounded. Fresh off the Newsweek-Daily Beast merger, Ms. Brown was all smiles and adjectives: "We've assembled so many free-thinking firebrands, social revolutionaries, outside agitators, dangerous rabble-rousers in this theatre tonight that I think we have to take out a whole different insurance policy."

Substance arrived in the form of Wajeha H. Al-Huwaider, Saudi journalist, and Dalia Ziada, Egyptian author, who talked up a storm on women's issues in the Middle East.

"Tomorrow is a big day for Saudi Arabia, " said Ms. Al-Huwaider. "For tomorrow's protests, they told women to come in the front row because Saudis don't attack women. We are to protect the men in the back."

"We never thought it would turn into something so big," said Ms. Ziada of the Egyptian revolution. "We just decided to go to the streets on Jan. 25 to give the police a hard day." When they had won, "Our colleagues, the men who had stood beside us the day before, told us ‘go back to your home'; it's not right to talk about women's rights now."

Ms. Brown managed to fit in a gibe at MSNBC's Chris Matthews, who recently pieced together a documentary on Bill Clinton, entitled President of the World. Calling it a "puff piece," she asked the former president: "Where was he when you needed him?"

Perhaps her sour grapes are the result of being scooped. The release of her book, "The Clinton Chronicles" has been delayed indefinitely while she saves the world one major media take-over at a time.

kclarke [at] observer.com

Let's destroy this sham of a technological confabulation once and for all. But before we do that, let's call it what it really is: the Woodstock of our generation. Which is to say, an excuse for unattractive men to disguise themselves as forward-thinking revolutionaries in hopes of getting laid.

But here's the sad truth, South by Southwest fanboy: you're not a revolutionary, and worse, you're not getting laid.

Come to think of it, "SXSW" is less like Woodstock than a revival meeting, but without the virtue. You've got your blind faith, speaking in tongues, fantasies of redemption and plenty of "evangelists."

Can you get an "Amen"? Not from me, suckers.

"WE ARE AT A PIVOTAL MOMENT!" some panelist will preach to a laptop-toting choir. "SOMEONE MUST INTERPRET ALL THIS DATA!" Out on 6th Street, meanwhile, a bunch of drunken mooks pile on top of each other in sweltering heat while the stench of human odor and overused mobile applications permeates the air. Disgusting.

Any value "SXSW" might have had wore off shortly after everyone stopped spelling the whole name out. (Now they call it "South By" and soon it will just be a vague hiss: like "Sssuhhhhh...") But over the years the conference has become a gross parody of its original intentions. Let me break down the daily schedule of the average ding-dong who still goes to this festival:

He comes to on a dorm room floor, breath stinking of Corporate Super-Sponsor Miller Lite. He collects his buttons, stickers and vanity USB sticks. He stumbles into the Austin heat, where someone is handing out samples of Pepsi Max or Brisk Iced Tea or, worst-case, Monster Energy Drink. He bikes over to the Dell Computer Lounge for another panel and the "opportunity" to network with someone who coded some software that makes it easier to identify smells. Which will come in real handy back at the crash pad.

And I cannot stress this enough: No-one has gotten laid.

Why don't you people do something useful? Maybe make an app that allows users to avoid getting beaten by government thugs. Then have your little festival. There's a global famine going on. Make a food replicator like they had on Star Trek, then file for your parade permits.

All this banging on about techno-utopias when so much of the world is so cocked-up makes my ears bleed. Sorry, dorks, but fancy cloud computing isn't going to help us educate our youngsters or take out the trash.

Here's a newsflash, Soup Soup: If you're a real innovator, you're not out in Texas shaking hands with indie bands; you're 15 years old, grinding out the hours in some Connecticut basement, soldering together old Kaypros and giving Steve Jobs the night sweats.

Get rid of South by Southwest. Strangle it with its own lanyard. And save the backslaps for when we really have something to be proud of, like a program that can finally stop my iPhone apps from wiggling.

Grow up, you babies.

mtaylor [at] observer.com | @mbrookstaylor

Ms. Toumei introduced herself to the balladeer as "Lady Catarina" and began to regale him with tales of her upcoming trip to Monte Carlo and Cannes. The talk didn't interest Mr. von Hildebrandt, who after all just needed a publicist. But something was amiss about Lady Catarina. For a titled member of ostensibly European nobility, Ms. Toumei drove an improbably crappy car. She claimed that the battered jalopy, which was damaged at every corner, was a rental. Her jeans and bleached-blond hair didn't exactly scream "possible member of the landed gentry," either. And she was more interested in chatting about her continental connections and aristocratic title than what she would do to earn her proposed fee of $3,000 to $4,000 a month, though Mr. von Hildebrandt had a feeling she needed the money.

After the meeting, Mr. von Hildebrandt emailed Ms. Toumei asking for a résumé. None came. The potential partnership fell through, but that didn't stop Ms. Toumei from listing Mr. von Hildebrandt as one of her "clients" on her Web site, bestsellingwriter.net. It was a small lie on top of a few others--the "rented" car and the pretension to royalty--and one in a long string of fabrications and exaggerations that would ultimately culminate in her arrest on charges of conspiracy to commit fraud by claiming to sell, among other things, a billion dollars' worth of diamonds purportedly belonging to the Guggenheim family. The complaint alleges that Ms. Toumei, along with her co-defendants, Vladimir Zuravel and David Birnbaum, falsely claimed to be members of the famous family in order to "gain access to highly regarded and/or wealthy individuals." 

It's generally unwise to impersonate people, but it's hard to imagine a riskier selection than the Guggenheim family, whose patriarch, Meyer Guggenheim, made his fortune in mining and smelting during the 19th century. The family's imprimatur can be seen on art museums in Berlin, Abu Dhabi, Venice, Bilbao and New York. Meyer's descendants have gone on to take their own respective places in American history. His son, Benjamin, died on the Titanic; Benjamin's brother Solomon is the namesake of the Frank Lloyd Wright-designed art museum on the Upper East Side; Benjamin's daughter Peggy was instrumental in aiding the careers of Jackson Pollock, Salvador Dali, Mark Rothko and many others. Fellow Meyer descendant Harry Frank Guggenheim served as the ambassador to Cuba and co-founded Newsday.

Another reason not to step on Guggenheim toes: Out of the family's private wealth management office has grown New York- and Chicago-based Guggenheim Partners, a $100 billion-plus privately held asset manager with offices in 20 cities across the globe, from London to Singapore. One of the Guggenheim heirs is a managing partner. And they don't take well to impostors.

The many mundane falsehoods that surround Ms. Toumei make it difficult to pinpoint what parts of her life, and which people in it, are authentic. Nevertheless, after consultation of public records, her college yearbook and people who know her, even a skeptic can justifiably believe the following: Catarina Toumei was born Rina Nastopka on Sept. 12, 1966. She grew up in Maryland and graduated from the University of Maryland-College Park with a B.S. in journalism in May of 1987. Also true: Ms. Toumei was married three times: once to a tax attorney; once to a Presbyterian minister turned mortgage broker; and once to a real estate investor. (According to court documents, she falsely claimed to be married to John Ratzenberger of Cheers; according to emails obtained by The Observer, she also claimed to be an ex-fiancée to Prince Albert of Monaco.) The marriages, combined with Ms. Toumei's own penchant for self-reinvention, resulted in a slew of name changes. Rina Nastopka became, by turns: Rina Anastopulos, Rina Nastopela, Rina Twomey, Catarina Twomey, Catarina Frederick, Catarina Toumei and finally, at least for the time being, Lady Catarina Toumei. In keeping with the ostentatious evolution of her name, Ms. Toumei's fanciful online self-portrait crackles with astounding achievements and high-powered connections. On her personal Web site, bestsellingwriter.net, and her LinkedIn profile, she attests to a smattering of impressive achievements--enrollment in graduate programs at Georgetown University and Fuller Seminary, jobs on Capitol Hill and at CNN, not to mention the title of Lady, bestowed on her "by European Royalty, for her humanitarian efforts." On the Internet, Ms. Toumei held herself out as an "Investment Relations Manager and Equity Research Specialist," who in her spare time did both journalism and PR work "for a handful of individuals internationally." 

Of the 24 "Current & Previous Clients" Ms. Toumei lists on her Web site, some (like CNN, Hilton Hotels, KUSI-TV and Coldwell Banker) cannot verify that she had ever done any work for them. Others (the Rancho Santa Fe Review, a newspaper based in the wealthy suburb of San Diego where Ms. Toumei resides; Patrick Rummerfield, a former quadriplegic who willed himself to mobility; the peace-loving Mr. von Hildebrandt; and Ohio State Treasurer Josh Mandel) deny it outright.   

In the declining years of her most recent marriage, Ms. Toumei began to step up her online presence, registering bestsellingwriter.net in 2008 and creating another site, the admirably search-optimized sextradebook.webs.com, to promote Sex Trade. Part Memoir. Part Fantasy. The "fictional thriller" features "A young prostitute accused of murder, a Native-American single mom, an African-American showgirl, and a Harvard-graduate transvestite." According to sextradebook.webs.com, proceeds from sales of the book, which may or may not exist, would pay fees for the establishment of a tax-exempt nonprofit. That organization would in turn direct future funds to "about 14 charitable organizations throughout the world, that physically rescue children from brothels, street corners, and bars." But put away your wallets; the PayPal account attached to the site is currently frozen.  

The sex-trade initiative stands alongside some other projects that Ms. Toumei perhaps should have avoided. In a Jan. 2, 2010, blog post on bestsellingwriter.net, Ms. Toumei excitedly proclaims that she is "invested with" the "fastest-growing privately held company in America and the fastest-growing beverage company in America." Ms. Toumei's enthusiasm was directed at Efusjon, an energy-drink company that was sued in November 2009 for allegedly running a pyramid scheme. The case was settled under undisclosed terms; Efusjon denied wrongdoing. Deana Carter, a close friend of Ms. Toumei's, said that the investment never really paid off for her, despite efforts to sell the beverages on Facebook and distribute them through a local country club.  

Things continued in this haphazard manner until March 2010, when Ms. Toumei made an acquaintance that carried her fantastical Internet voyage from get-rich-quick whimsy into legitimate legal peril. It was then, according to co-defendant Vladimir Zuravel, that Ms. Toumei first reached out to him on Facebook--where, with permission from his purported mentor, "Mr. David B. Guggenheim," he maintained a profile under the name "Vladimir Z. Guggenheim." Mr. Zuravel told The Observer that he was born in the Republic of Moldova to a "respectable Jewish family." There is something of
a Toumei-ish streak to the way Mr. Zuravel presents himself: He spent two years in the Soviet Special Forces instructing soldiers for the war in Afghanistan, before attending military university to become a pilot, and then dropping out to go to medical school. He is a champion martial arts competitor, having trained since he was 4 years old. He knows kung fu, jujitsu, karate and other techniques. He speaks Russian, Ukranian, Moldavian, Polish, Hungarian and Czech. He's a vegetarian, and he never smokes, drinks or does drugs.  

After moving to America in 1992, Mr. Zuravel said, he spent his first 13 or so years here training for seven or eight hours a day. Living in the Edgewater area on Chicago's North Side, he enrolled at the Military Arts Institute of Martial Arts. He studied under Grand Master Shin, swam in Lake Michigan in the winter and ran barefoot through the snow, he says. (A staff member at the Military Arts Institute remembered Mr. Zuravel, and said he had been enrolled there for about three years.) At the institute, Mr. Zuravel said, he became a captain of the demonstration team for Tae Kwon Do and Hap Ki Do. "I was monk," he said. "That was 16 years--no friends, no women. Train, train, train every day." When he wasn't training, he attended several synagogues, including Synagogue Ephraim, and studied the Torah. Despite all that athletic discipline, medical training, military acumen and religious zeal, Mr. Zuravel said he worked odd jobs in Chicago doing construction and driving taxis. He is currently unemployed, but he hopes soon to launch a Web site where he will sell a "patented" exercise system for golfers.  

According to Mr. Zuravel, he met David Birnbaum through a friend five years ago, soon after he moved to New York. Mr. Zuravel said Mr. Birnbaum was very impressed not only with his royal pedigree but also his Russian connections and command of the language. The pair formed a quick bond, and Mr. Zuravel began to serve as Mr. Birnbaum's bodyguard, which is not surprising, given what Mr. Birnbaum was doing at the time. In the years leading up to Mr. Zuravel's arrival, Mr. Birnbaum appears to have been pursuing several large business deals in Russia. An Aug. 23, 2004, article in Kommersant identifies a "David Guggenheim," chairman of Dabir International, as a potential buyer in an auction of the Russian government's 7.59 percent stake in Lukoil, but concludes, "Analysts believe, Guggenheim, whose name is new to the oil industry, may be used by officials in negotiations with ConocoPhillips. However, as a potential buyer he does not seem to be a serious competitor to the other auction participants--analysts predict that Lukoil will not want to have an unknown investor."  

As it turns out, this particular investor was unknown even to the Guggenheims. The following month, a spokesman for the Guggenheim Brothers investment company told The New York Times that the bidder had no ties to the family. The Times was nonplussed: "It is unclear how David Guggenheim, whose address is listed as Ocean Parkway in Brooklyn, is obtaining financing for the minimum Lukoil bid of $1.93 billion."

Mr. Birnbaum's explanation of his extensive capital resources, as recounted by Mr. Zuravel, is as follows: The first thing to realize is that there is another Guggenheim bank--not a company, but a "system of banks." This Guggenheim bank system, which consists of "lots of banks," "transferred" to Deutsche Bank at some point, and then broke up into four or five banks. When Solomon Guggenheim--the real-deal, museum-namesake Guggenheim--died, he created a "small foundation" that somehow disappeared through a series of transactions and transplants. A part of the rogue fund moved through Russia, to Japan, then to China. Another segment of the fund "broke into two pieces." At some point, one such fund came to contain trillions of dollars--a series of transformations rivaled only by those of the defendants. Mr. Birnbaum claimed he was eventually entrusted with the fund, on the condition that he not use the Guggenheim family name.   

Asked why Ms. Toumei might have reached out to him in March, Mr. Zuravel said, "She's a very friendly woman. And she has lots of friends in the world, in the U.S.A. She's a very beautiful and charming woman." He also said that his main goal in maintaining a Facebook page was to meet women.  

It wasn't long after she made initial contact with him, Mr. Zuravel said, that Ms. Toumei had a direct line to Mr. Birnbaum via email and phone. Mr. Zuravel also said he stopped working for Mr. Birnbaum shortly after Ms. Toumei entered the picture.

After making Mr. Zuravel's and Mr. Birnbaum's acquaintance, Ms. Toumei and the pair of purported New York Guggenheims soon embarked on a whirlwind of negotiations with prospective buyers, according to a civil complaint filed in November of last year against the trio and 12 others. The plaintiffs in the multimillion-dollar suit: Guggenheim Partners, manager of more than $100 billion in assets, and its holding company, Guggenheim Capital.   

The alleged deals varied from month to month in what became a 2010 romp through the investing and commodities-dealing community. In May, Ms. Toumei allegedly registered the domain guggenheimadvisors.org, in what may very well have been the pinnacle of her online recklessness. The Guggenheim plaintiffs say that in July, Ms. Toumei, Mr. Zuravel and Mr. Birnbaum solicited purchase contracts for $1 billion to $3 billion worth of crude oil--and attempted a fraudulent purchase of $1 billion in 24-karat gold bars. In August, the trio allegedly shifted gears to try to sell Guggenheim-branded vodka to the Coca-Cola Company. In September, they tried to sell bank guarantees to Standard Holdings CEO Chad Geren and also tried to court Rupert Murdoch for a business deal, according to the complaint. October brought an alleged attempt to solicit a sale of diamonds and a stab at using the Guggenheim name to arrange an introduction to George H.W. and George W. Bush.      

Mr. Birnbaum's lawyer declined make his client available. "He maintains his innocence," said Mr. Birnbaum's lawyer. "There's a process involved here. He's going to go through that process. And he believes that he will be vindicated in connection with any proceeding that might be brought here, but we're not going to have any comment beyond that." The Observer called David Birnbaum's number to seek comment for this story. A man who answered Mr. Birnbaum's phone suggested that we "try him next week."

In a rough-and-tumble business with high stakes and savvy operators, it pays to be smart. The operation Ms. Toumei, Mr. Zuravel and Mr. Birnbaum are accused of running was almost comically stupid. One source who was approached by Ms. Toumei about doing a deal told The Observer he smelled something rotten very early on. "They went so far off bank procedures. That was a red flag."    

A phone call with "Vladimir B. Guggenheim" and "Lady Catarina" did little to persuade the source. "You remember [Rocky and Bullwinkle]? That cartoon with the two Russians?" he asked The Observer. The pair was "like Boris and Natasha." On deciding he had a fraud on his hands, the source says he called lawyers for the Guggenheim family, but continued to play along with Ms. Toumei. "I was kind of fishing. I wanted to see how far they would go along," he said. "I was trying to push them right off a cliff."

Eventually they pushed themselves.

On Jan. 31 of this year, the U.S. attorney's office in the Southern District of New York followed up with fraud allegations against Ms. Toumei and Messrs. Zuravel and Birnbaum. The trio now faces up to 20 years in prison each for a scheme so over the top it should have never seemed believable to anyone.

A sale of $1 billion worth of diamonds is also mind-bogglingly implausible. By way of comparison, DeBeers, the world's largest diamond company, took in $5.88 billi
on in revenue in 2010.

"There's no such thing as a $1 billion rough diamond deal," said the source.  "You just don't swing those deals over the Internet." 

Additional reporting by Amanda Sterling

"Think about it," groused a magazine veteran not connected with the deal. "Anyone who's been at HuffPo that long probably has zero creative fire, talent or editorial ambition. Now these people are cashing seven-figure checks?"

The big winners are "the most boring, non-personality people," according to a former Huffington Post employee who turned down a big job early on.

"There's always regret when you see money being handed out in giant chunks," admitted Rachel Sklar, who worked at the Huffington Post from 2006 to 2008 but says she "never inquired" about equity.

If anything, the deal should "light a fire under people's asses" to build their own media companies, said Melissa Lafsky, another former HuffPo editor who worked for a straight salary. While crediting the site with launching her career, Ms. Lafsky, who now edits the blog Infrastructurist.com, had a warning for young scribes who sign on to new media ventures: "Demand equity."

An original Huffington Post employee who followed that advice and is now sitting on a large payout as a result said the equity incentives helped compensate for a lack of job security during the lean years, when it was far from clear that Ms. Huffington's pet project would survive. People who got equity got it through hard work, the source added.

For her part, Ms. Sklar, now a start-up consultant and editor at large for Mediaite, said she harbored no ill will toward Ms. Huffington and felt working for her had been the right decision. "It was the start of my whole career," she said. Besides, she added, "Arianna started me going on TV."

Andrew Breitbart, who helped create the Huffington Post, did not benefit from the sale, having already cashed in his marbles to fund his own Web site, Breitbart.com. Still, he had no regrets. "Money's not everything," he said. 

Clarification: Ms. Sklar's words, "never inquired," were in reference to equity packages in general at the Huffington Post, not any prospective equity packages for herself. Ms. Sklar declined to discuss her personal financial dealings with the company.

Finally, I'd like to say that Tom encouraged his class to tweet during class. I think that is fantastic. The tweet stream is like publicly available course notes for the class we did yesterday. Every time I talk to a class full of students I am going to call out a hashtag at the start of class and encourage tweeting.

Tweeting in class! Counterintuitive though it may be, we endorse the approach, with some provisos. No at-messaging celebrities; Tweets about technical mishaps with overhead projectors are to be kept to a minimum; no tittering.

mtaylor [at] observer.com | @mbrookstaylor

Founded in 2007, Solvate offers a catalog of pre-screened freelance employees who work in a variety of industries. Mr. Paolucci has characterized his firm as follows:

We are becoming the intermediary between parties who are already related but don't have a clear path to work together. We've standardized the way to describe thousands of services people can perform, as well as a protocol for engagement between talent and clients for work. The mating ritual is governed by interfaces that make it safe, easy, and comfortable to work through the wire.

By the way, for those interested in the provenance of quirky tech names, a solvate is "a more or less loosely bonded complex formed between a solvent and a dissolved species," an appropriate enough metaphor for a scattered network of for-hire workers who dissolve their talents across a broad market, if you will.

mtaylor [at] observer.com | @mbrookstaylor

As interest in startups seems to rise by the day, it's important for investors to convince prospective portfolio companies that they can bring something special to the market. Mr. Herman thinks an ad firm can fulfill an important need in this environment.

A 12-year veteran of the New York technology scene, Mr. Herman has advised 10-odd startups and founded several others. His experience with East Coast technology companies leaves him confident enough to divulge personal quirks on his website, including his lifelong desire to design handbags and his passion for Jenga and the Madden 2007 football video game. 

It's a confidence apparently shared by KBS+P, a New York agency whose clients include Coca-Cola, Church's Chicken, BMW and NetJets. The firm is backing Mr. Herman's plans to do between 10 and 15 early-stage investments of between $50,000 and $150,000 this year, adding Managing Director of Ventures to his existing title. The idea is to follow on rather than lead investment rounds in companies that develop ad technology and display successful integration of design, user experience and presentation with the technology itself.

Cloud computing and other factors are making it easier than ever to launch a product. So to succeed, companies now need to focus on user experience and design at least as much as just coming up with a technical product.

"There's no better thing to leverage than an extremely successful marketing and services organization," says Mr. Herman. KBP+P also plans to exploit its connections with Fortune 500 brands to help them stand out in a crowded technology scene.

It's a crowded market, but Mr. Herman says his firm offers something special to startups. KBP+P also plans to exploit its connections with Fortune 500 brands to help startups stand out in a crowded technology scene.

This morning, the company announced a deal with Yieldbot, a company that culls data about online users with an eye toward helping publishers increase ad revenue by providing advertisers with more comprehensive information about their readers. KBS+P invested alongside New York known quantities RRE, Betaworks, Jerry Neumann, David Tisch and Howard Lindzon, among others. Mr. Herman says that KBSP has already inked another deal, and "We're close to a couple others."

As startups increasingly focus on consumer-facing data-driven products that are easy to create, much of their legwork now involves getting the word out. "If you're an in-the-black agency that can afford to do a lot of the marketing for free, that is one of the biggest expenses for a startup these days," says Rick Webb, cofounder of the Barbarian Group.

KBS+P certainly takes an adventurous attitude toward the ad business. The agency is part of giant holding company MDC, helmed by Miles Nadal, who's known to strike out into unmarked territory.

"MDC's Miles Nadal is a swashbuckler looking to evolve the industry. The traditional agency model of fee-for-services has been under erosion. If KBS+P is literally putting its money where its mouth is, good for Miles to ultimately tie MDC's bottom line to that of its clients," said Michael Duda, co-founder of Consigliere, a firm that seeks to merge marketing with investing.

In other signs of its go-ahead spirit, the firm recently developed a multicultural division, calling it "Ramona," in an effort to move in on agencies that specifically target Hispanics and African Americans. It's also the company behind the idea to let customers to design their own Pumas using in-store iPads.

For all the confidence his agency is displaying in the power of startup investing, he doesn't expect many competitors to follow his lead, at least not right away. "We expect other agencies to follow us into the space should we show success," he says. "Right now, there are very few significant marketing services organizations that understand the early stage ecosystem who have a combination of startup technology operating experience mixed with their agency DNA. One of our key differentiators is that we've been on both sides of the fence and understand what startups need to succeed."

If it's successful, this initiative could usher in a new era of collaboration between startups and ad agencies, where the agencies deploy their marketing and PR firepower to get new companies off the ground and portfolio companies provide innovative approaches to the industry. But for that notion to bear fruit, Mr. Harman is going to have to make judicious decisions in a heated startup environment and effectively insert his firm into the increasingly competitive early-stage investment arena.

mtaylor [at] observer.com | @mbrookstaylor

Publishers set the price and length of subscription (weekly, monthly, bi-monthly, quarterly, bi-yearly or yearly). Then with one-click, customers pick the length of subscription and are automatically charged based on their chosen length of commitment (weekly, monthly, etc.)

Apple will continue to ring up the payments and take a 30 percent cut along the way. "Our philosophy is simple - when Apple brings a new subscriber to the app, Apple earns a 30 percent share; when the publisher brings an existing or new subscriber to the app, the publisher keeps 100 percent and Apple earns nothing," said Steve Jobs in a statement.

So it looks like publishers get to keep the revenues coming from existing sbuscribers, but new subscribers' money goes in part to Apple. Score one for the news industry! Oh wait. As GigaOm points out, there's a big "On the other hand":

However, Apple does require that if a publisher chooses to sell a digital subscription separately outside of the app, that same subscription offer must be made available, at the same price or less, to customers who wish to subscribe from within the app. In addition, publishers may no longer provide links in their apps (to a web site, for example) which allow the customer to purchase content or subscriptions outside of the app.

And so it seems that the longstanding kerfuffle between Apple and publishers over app revenues has not exactly been resolved.

mtaylor [at] observer.com | @mbrookstaylor

Graphic designer and Upper West Side bartender Bari Simon created the app. From the What's on Tap? home page:

We are the extended neighbors knocking on the door with our pitchers and empty glasses. The passion and ingenuity of today's "craft brew masters" cannot be duplicated by a machine.

The Observer has never heard such a knock at the door, but we nonetheless welcome the digital equivalent.

A 2.0 version of the app will boast improved location service, automated beer alerts and a beer crawl customization tool, among other things. (via DNAinfo)

mtaylor [at] observer.com | @mbrookstaylor

Hang-ups over security requirements hampered the Boxee-Netflix partnership earlier this month. Those were the latest in a series of headaches the firm suffered after a hype-building demonstration at the Consumer Electronics Show.

Even with the major Netflix issue taken off the table, there are still a few kinks to work out, says CrunchGear: 

Now with Netflix on board, what are the Boxee forums and fan sites going to complain about? Well, there's still the occasionally lag in the UI and the box likes to lock up once in a while. Subtitles randomly start with locally-stored movies and the browser could be a bit faster. So yeah, the lack of Netflix was the main bitching point before, but the system certainly still has enough bugs to keep the forums rocking.

Haters gonna hate, but in an environment where hype and disappointment can combine with disastrous results for a startup, Boxee is fortunate to have righted itself after a tough couple months.

mtaylor [at] observer.com | @mbrookstaylor