BT Firm JellyCloud/Gator Closes Up Shop

JellyCloud site Going Out of BusinessThe company formerly known as adware purveyor Gator has gone out of business, a former executive with the Silicon Valley shop confirmed.

The one-time adware giant, which was recently operating as an ad network named JellyCloud, last week let go of its 35 employees and hired a firm to sell off its behavioral targeting patents and other assets.

Despite raising $11.5 million earlier this year and joining ad exchanges run by Right Media and DoubleClick, the company decided it could not grow quickly enough to compete in the crowded ad market space. Instead, company executives and its board determined last month that selling JellyCloud's assets--especially its intellectual property portfolio--was the best way to get a return for investors.

As one of the first and largest adware companies, Gator drew fire from both consumer advocates and Web publishers. Advocates charged that the company tricked users into downloading its software, which tracked them across the Web and served targeted pop-up ads. Web publishers argued that Gator's pop-ups unfairly interfered with their own advertising efforts.



In 2002, publishers including The Washington Post, The New York Times and Dow Jones sued Gator. The parties entered into a confidential settlement agreement the following year.

Gator changed its name to Claria in October 2003, and in early 2005 announced it was getting out of the pop-up serving business and into online behavioral targeting. Claria continued to exist as a subsidiary of JellyCloud until last week, when the shop stopped operating.

Some Claria executives also recently resurfaced at NebuAd, a controversial behavioral targeting company that had planned to partner with Internet service providers to send ads to users based on their Web activity. NebuAd recently suspended those plans in the face of mounting criticism from privacy advocates and some lawmakers.

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