It turns out that the problem was with 3ivxVideoCodec.component.

Worse, it turns out that this little bugger had been causing problems with various apps for years as I’ve seen a history of people claiming problems with iPhoto, iTunes, Aperture, iMovie, QuickTime, and possibly other apps.

The Stupid Little Blog, shows how you can search for the file 3ivxVideoCodec.component and remove it, but some people have left comments saying that they aren’t finding it.

Apple made finding files much harder in some ways under Lion.

One annoying thing they did was to hide certain folders. However, MikeSel.info has a page showing how you can unhide the hidden folders/files in 10.7 Lion.

The short answer is to use the following terminal command to show hidden folders/files:
defaults write com.apple.Finder AppleShowAllFiles YES

And the following to undo this (hide folders/files that Apple thinks should be hidden:
defaults write com.apple.Finder AppleShowAllFiles NO

Restart, or re-login for the changes to take effect. Alternatively you could Option-Right-Click on the Finder icon in your Dock and select Relaunch.

If you have the FTP application Transmit, you can use that to both browser hidden folders/files, and delete them. Other applications may allow browsing/deletion of hidden folders/files as well.

Once you’ve revealed your hidden folders/files, you can go to:
/Library/QuickTime
(That’s the top level of your system hard drive -> Library -> QuickTime)

From that directory, delete 3ivxVideoCodec.component (if present).

Restart your Mac.

You may be able to relaunch iPhoto with everything working ok, but I’d recommend holding down the Option-Command keys while launching iPhoto and then let iPhoto repair/rebuild your library and thumbnails.

Alternatively, or if the repair/rebuild fails, you can restore your iPhoto library from Time Machine. You do archive with Time Machine on a regular basis don’t you?

This is more than just allowing purchases to be made through a back-end system such as Amazon for example, this allows developers to provide upgrade functionality in their apps. This could be all kinds of things from upgrading from a lite version to a full version, buying additional maps for GPS apps for the iPhone, buying avatars or next levels for games, or subscription based services.

The fear here is that developers will nickel-and-dime users in an effort to constantly extract as much cash as possible instead of providing an upfront known price associated with the app.

And this is what I think:

1) Most developers have been really good about providing value for their apps. There are a lot of $1 apps. Even more so, there are apps which are very useful that are free because there’s a business model that doesn’t involve charging for the app. There have been many exceptions where people overcharge, but people usually price compare and competition is pretty high.

2) The ratings and rankings system will filter out abuse. People charging too much for their apps are given really bad reviews in the iTunes App Store. People can be brutal with their iTunes reviews. It’s almost as bad as Yelp.

In the end, most developers will be conscientious enough to be responsible to begin with, or will learn quickly that they must be reasonable with the in-app sales.

I guess we’ll find out soon.