Dave Winer, creator of the Manila blog system, has shut down the weblogs.com free hosting service overnight, cutting off about 3000 blogs. The Slashdot story gives good background, and Dave Winer offers his defense.
This comes only a month or so after Six Apart, makers of Moveable Type blog software, drastically raised prices, in a pretty clear attempt to get users of the free MT software to eventually migrate to their paid service, TypePad.
Both of these business decisions are justifiable on the merits but have left users of the respective services outraged. I think however that they are important developments, because they help to illustrate the limitations of various models for blog services.
The main problem in Manila's case was that the server load became too high. This is a pretty powerful argument against dynamically-generated blog pages - the Blogger method of static files is much more scalable. Blogger has an advantage over Manila in that the actual pages generated after publishing are strictly text-html. The otherwise excellent blog software Wordpress also boasts of dynamic page generation, which is a deal-breaker for me despite the fact that WP is essentially perfect in all other respects. Static pages are archived more consistently in Google, they require very little server load to host, and they provide an instant-backup (to archive your blog, just download the static files).
The main argument against Moveable Type was cost - over $600 for version 3.0 if you run multiple blogs and have multiple team members. That's an absurd price, and while TypePad hosting is cheaper, it still costs you several hundred dollars a year to gain the same control as you do for free on blogger.
Overall, I am pleased with Blogger and intend to remain - especially since the acquisition by Google puts Blogger at the center of innovation (and it got me some gmail invites too).
That said, what does Blogger need to improve on? There are two gaping holes: 1. searching and 2. categories. Since blogger data is stored in the backend as a database, a search function should be made available to weblog authors from their control panels, and not just the rudimentary search box currently available, but rather a full-fledged field-specific advanced query capability. For categories, there needs to be the ability to classify posts - and in this regard, adopting the "virtual folder" labeling of Gmail would be ideal.
In fact, gmail provides the perfect model for both of the above. A single archive, accessible through powerful search filters, and a "virtual folder"labeling system. All of which allow the author to easily access the data and to also provide "custom views" of the data (published to static files) as needed for the readers.