Study Shows Microsoft's MSN Messenger Has More Subscribers than AOL - Microsoft Corp.'s MSN Messenger service, America Online Inc.'s Instant Messenger service - Brief Article

ISP Business, April, 2001

A little-publicized study commissioned by Microsoft shows that the company's MSN Messenger service has more worldwide subscribers than its chief rival, AOL. The study calls into questions AOL's decision to block users of its Instant Messenger service (AIM) from communicating with rival software users.

Both AOL and Microsoft have used other properties to push their IM service. AOL offers AIM through several Time Warner sites, and has agreements with IBM, EarthLink, RealNetworks, Apple Computer, Juno Online, and Novell to offer a co-branded version of AIM through their services. AIM is also going into cell phones using AT&T or Sprint, and Palm handheld devices and Research In Motion pagers. In addition, AOL owns the second-largest instant messaging service, ICQ.

MSN Messengers is embedded in Windows Millennium Edition, and MSN Explorer. The company's Hailstorm initiative will also make MSN Messenger and other Internet features, including its Hotmail e-mail service, available from any device.

The merger of AOL and Time Warner prompted the FCC to require interoperability of its IM service, but only when AOL begins to offer advanced IM services such as video and audio streaming. Microsoft has helped to lead a group of companies called IMUnified, which is expected to launch a system linking the messaging products and networks of its members. IMUnified includes Yahoo, AT&T, and Excite@Home. The group has aggressively lobbied Capitol Hill and federal regulators to force AOL to open its IM network.

Instant messaging services are free. Their value for the companies lies in the marketing and cross promoting of its other products, and the recruitment of new subscribers.