Doesn't this move stink of desperation?

Looks like they're sacrificing some of their initial user base to make Bitly social.

Bitly users are revolting.

"It takes a lot more work to just paste in a long URL and copy/customize the resulting URL. I realize there's a bookmarklet (both a new one and the older one that still works) but the new site design makes it a lot more cumbersome to just get in and get out," says user Evan Connors on TechCrunch. [Source]

Isn't that the kiss of death for a startup? Screw up the one thing that people actually liked about your service -- usually simplicity -- without adding any new value that makes sense to your users?

See Foursquare for another example of a company that knows they need to find some other line of work because Facebook and/or Twitter replicated their core business... but hasn't really managed to come up with anything that makes sense FOR THE USER as opposed to FOR THE COMPANY.

Well, Bitly had to do something. As did Foursquare. They've both raised a lot of money.

I'm not quite sure what Bitly's core value proposition is. I'm guessing it's analytics?

If that's the case, then the move to convert it to a social discovery network is a bad one.

If instead Bitly believes its core value-add is to surface the most popular links that are being shared, then perhaps it will find new life as a social discovery network.

I agree with your skepticism. What's good about Bitly isn't new, and what's new does not look good.

Bitly as an URL shortener is bad for the Web, especially now that 1% of all Web clicks go through Bitly.

It's a single point of failure for all of those clicks.

Here's what the founder of Delicious said about URL shorteners:

The worst problem is that shortening services add another layer of indirection to an already creaky system. A regular hyperlink implicates a browser, its DNS resolver, the publisher's DNS server, and the publisher's website. With a shortening service, you're adding something that acts like a third DNS resolver, except one that is assembled out of unvetted PHP and MySQL, without the benevolent oversight of luminaries like Dan Kaminsky and St. Postel.

The biggest burden falls on the clicker, the person who follows the links. The extra layer of indirection slows down browsing with additional DNS lookups and server hits. A new and potentially unreliable middleman now sits between the link and its destination. And the long-term archivability of the hyperlink now depends on the health of a third party. The shortener may decide a link is a Terms Of Service violation and delete it. If the shortener accidentally erases a database, forgets to renew its domain, or just disappears, the link will break. If a top-level domain changes its policy on commercial use, the link will break. If the shortener gets hacked, every link becomes a potential phishing attack.

There are usability issues as well. The clicker can't even tell by hovering where a link will take them, which is bad form.

Bitly was not a good business to begin with.

I go out of my way NOT to click on Bitly links for the reasons mentioned above.

But the truth is, they solved a problem: 140 character limitations for Twitter...

They solved a temporary problem that no longer exists. Twitter has its own shortener.