Sponsored features are any feature of the site that we offer through a partnership with another company. The first such feature is going to be SMS functionality -- increased ability for you to interact with LJ from your mobile phone (such as posting, reading your friends list, etc). These are features that we've developed for the benefit of our users; they're "sponsored" because the resources (funding and development) for enhancing and adding features go beyond our core capabilities, and so we work with another company that can help us out. They're things we've wanted to add to the site but were never quite able to do so on our own, and hopefully they're things you'd want to use.
Our partners are companies that want to tell people about their products or services, and they're companies that we feel offer a bunch of things that LJ users might find valuable. So in addition to developing features you can use, we form a sponsorship relationship with them to promote their services. These sponsorship programs can involve a variety of different things -- co-marketing efforts, joint press releases, sponsored communities, advertising in the existing ad program -- and various "promotional placements". These are essentially a type of advertising that acknowledges their sponsorship of a given LJ feature. These are graphics or text that say things like, "LJ Gerbil Sweaters ... sponsored by XYZ" or "LJ Bundt Cakes in partnership with Company ABC".
How is this going to affect the account levels
Paid/Permanent Accounts We never meant to upset you guys by saying that paid and permanent account users will see "sponsored by" logos or advertisements with these features. We're not going to do that. However, we're not going to make these features entirely invisible to you, either. You'll still know about the existence of a sponsored feature, you'll see links to those features, and you'll still be free to use them if you want to. We're just going to avoid displaying any sort of marketing or promotional content for another company; your experience with these features will hopefully be exactly like your experience with any other feature we offer. From a business's perspective, part of the appeal of sponsoring a feature *is* the associated promotional placement that comes with it, sure, but we decided we're willing to eat the costs of that.
Plus users As users who've opted to see advertisements on the site, you will also see these promos on the feature pages when they use them; we feel that's fair, and I'm pretty sure you guys do too. (At least, I don't remember seeing comments expressing otherwise!)
Basic users In this case, we have two options: (1) not offer the feature to them at all; (2) offer the feature and pay for it through sponsor placement. We chose to go with the second route. Basic users who don't want to see the ads can avoid using the feature, and they will be no better or worse off. It costs us money to offer these, and so the least we can do is display a promo for a sponsor if you're not otherwise paying us to use it.
With that said, it's up to you how you want to use these; if you don't want to use these features at all, that's fine, but we hope that we didn't sour you on the experience entirely. As always, we'll be reading the comments here, and if we see any major points of concern, we'll make new posts to address them.