Microsoft and AOL Engage in Battle Over Instant Messaging on the Internet

Strategic Insights -

The high-tech sector is witnessing an intriguing battle between Microsoft and America Online over the future of instant messaging on the Internet. Microsoft, a dominant company pushing proprietary software, is challenging AOL's dominance in instant messaging with its push for open standards and free software. The stakes are high, with a potentially profitable slice of communications business on the line and the question of whether a critical portion of the Internet can be captured by a single, proprietary system.

Key Takeaways:

  • Microsoft is challenging AOL's dominance in instant messaging with its own software that can communicate with AOL users and others.
  • AOL has engineered ways to block Microsoft messages, leading to Microsoft re-engineering its software five times in a week to overcome the blocks.
  • The two companies are engaging in a battle over interoperability, with Microsoft committed to providing the interoperability users have asked for.
  • America Online's proprietary messaging software is similar to Microsoft's Windows desktop operating system in that it is exclusive and fights fiercely to stay that way.
  • AOL has formed an alliance with Apple and established an advisory body to develop standards for an open messaging protocol.
  • A task force of technology specialists is working on a common standard for Internet messaging that would be available as a foundation for anybody who wants to build a system.

Statistics:

  • 40 million people use AOL's instant messaging software.
  • Microsoft has re-engineered its software five times in a week to overcome blocks erected by AOL.
  • The task force working on a common standard for Internet messaging may take a year or more to finalize that standard.

Sources:

  • "Microsoft and AOL Engage in Battle Over Instant Messaging on the Internet" (no date specified, but attributed to the New York Times)
  • Microsoft's Web site, which said it was "committed to providing . . . the interoperability [users] have asked for."
  • America Online's announcement of an alliance with Apple and the establishment of an advisory body to develop standards for an open messaging protocol.