Instant messaging is much
like a regular conversation
Microsoft and Yahoo are linking up their free instant messaging services,
giving the two extra muscle to compete against market leader AOL.
The Yahoo-Microsoft partnership allows users of the two services to exchange messages
The tie-up is the first major alliance between two of the internet's main providers
of instant messaging (IM).
Yahoo chief executive Terry Semal said the deal was "a turning point for
the IM industry".
Instant messaging has taken off because it allows people to communicate quickly
and seamlessly over the internet.
Some providers also offer other goodies such as video chatting and internet
This is the first time two of the top instant messaging systems have communicated
directly with each other. Before now, 'interoperability' was restricted to users
within each separate service.
California-based Microsoft already has a product allowing business users to communicate
with Yahoo and AOL through IM but the facility is not available to ordinary consumers.
"IM interoperability is the right thing for our customers, our businesses
and the industry as a whole, and Microsoft is delighted to help lead these efforts
with Yahoo," said Microsoft's chief executive Steve Ballmer.
US based AOL - owned by media giant Time Warner - is currently the market leader
in instant messaging with a 56% market share, according to research firm Radicati.
But Microsoft and Yahoo's allegiance could be a formidable threat to AOL's
"Up until now, AOL has been able to pick and choose its partners, command
the royalties it wants," said Robert Mahowald, an analyst at research firm
"They've moved to develop this market at their own pace. This forces them
to take a more aggressive stance."