Sparrow, the popular third-party Gmail client for iOS and OS X, has been acquired by Google for an undisclosed amount of money. Sparrow is one of my top three favorite iOS applications, and I’m not alone in my fanship: Sparrow is so popular that the Mac client alone sees hundreds of paid downloads per day. I’m happy for the Sparrow team, but also distraught over this decision to sell.

The biggest bummer is that Sparrow won’t be updated in the near future. In an email to Sparrow users, the team said they will “be busy with new projects at Google,” and do not plan to release new features for the Sparrow apps. And that is a downright shame.

Sparrow is already the best Gmail (and really, email) client for iOS, but there’s always something more that can be done. Sadly, that won’t happen now.

Secondly, if the Sparrow team isn’t going to work on Sparrow anymore, but will instead work on other Google projects, that’s a waste of momentum, taking a team that has been working on a product for over a year and tasking them for other projects. It wouldn’t be too much to ask of Google to take Sparrow and rework it into the official Gmail client for iOS, now would it? Instead, Google is going to be taking a committed team and turning them loose on other projects.

When asked for a comment on the Sparrow acquisition, a Google spokesperson wrote, “The Sparrow team has always put their users first by focusing on building a seamlessly simple and intuitive interface for their email client. We look forward to bringing them aboard the Gmail team, where they’ll be working on new projects.”

But aside from the technical talent, if Google is shutting down the team, why did it buy it? Well, there’s one likely reason. If Sparrow is as popular as it appears, the company is an obvious acquisition target. If it was acquired by Apple or Facebook, the clear candidates, it would have been bad for Google, as the best Gmail client would then be lost to a competitor.

Of course, it’s not all doom-and-gloom. When I spoke to company co-founder Dom Leca earlier this year, he pointed out that they had reworked the entire email processing engine from the ground up to be faster. The engine, which runs most of the application, was remade to run on as many platforms as possible. Specifically, the team was hard at work preparing the application for Android. This work will likely end up improving the Android Gmail application.

Finally, there is an opportunity here for other iOS developers. As Sparrow has shown, there’s a clear market for a third-party, Gmail-based client for iOS*. Sparrow is still tough to beat, but in a year or so, it will have fallen by the wayside, and that’s when the opportunity really shows up.

Sparrow originally raised money from French venture capital firm Kima Ventures.

Dom Leca declined to comment on this report.

*If any of you are making one, please email me.