Trio ink historic IM partnership

In what experts are calling a milestone in the evolution of corporate instant messaging, Microsoft, AOL and Yahoo formed a partnership last week that will enable Microsoft’s Live Communications Server 2005 to work with the IM services offered by the other two.

The three vendors, which have become the cornerstones of consumer IM services, say interoperability among their systems will only extend to corporate use of IM from the LCS platform. It will not integrate their consumer services, which all run on closed networks.

Today, nearly 80% of corporate IM is done over public IM services such as AOL, MSN and Yahoo, exposing companies to security risks, according to the Radicati Group.

Corporations have struggled with security and how to use existing directory name space for IM so they can track users, instead of having separate free-formed IM names that are difficult to associate with individuals.

Those issues, and the concern surrounding the sharing of presence information and buddy lists outside corporate boundaries, are at the heart of the partnership, experts say.

Companies that deploy Microsoft’s LCS 2005, which is due to ship by year-end, can add a connectivity pack module, which will ship in the first half of next year, that lets Microsoft IM users swap messages with those using AOL Instant Messenger, AOL ICQ, Yahoo Messenger and Microsoft’s MSN service.

AOL has similar integration deals with Reuters and Apple, but this is the first deal with Microsoft since AOL shut down Microsoft’s unauthorized attempts to integrate its MSN Messenger with the AOL buddy list. Bill Gates at that time asked the Federal Trade Commission during the AOL-Time Warner merger to require that AOL make its technology compatible with other IM services as part of the deal.

Pricing for those modules was not announced. Users will license the modules, and Microsoft will provide a portion of the revenue to AOL and Yahoo.

AOL says it will act as a clearinghouse for LCS users, providing routing services between users and protocol translation services.

For example, LCS uses Session Initiation Protocol and SIP for Instant Messaging and Presence Leveraging Extensions (SIMPLE), while AOL uses its proprietary protocol called Oscar.

“This is a huge win for the market because enterprise users always lost out,” says Robert Mahowald, an analyst with IDC. He says the only caveat concerns companies that were not included – IBM, with its IBM/Lotus Instant Messaging, and Sun, with its Java System Instant Messaging.

An IBM/Lotus spokesman says the company is not seeing customer demand for integration with consumer IM networks. “The demand is to integrate IM with business applications.”

Mahowald also says the partnership, which could see AOL backing SIP and SIMPLE, potentially might take some air out of the IETF’s other IM protocol, the Extensible Messaging and Presence Protocol.

Despite those issues, some in the industry say the Microsoft-AOL-Yahoo partnership foreshadows an explosion in the use of IM.

“This is the most significant event in instant messaging since it emerged on the Internet in 1996,” says Francis deSouza, CEO of IMlogic, which makes software that helps companies manage public IM services use. “We have been waiting for eight years for this and we are at the kink in the curve to explosive growth.”

Earlier this year, AOL and Yahoo dropped plans to provide software to support business-class IM. Experts now believe those actions might have been taken as part of the negotiations with Microsoft over LCS interoperability.