Big, Fat and Bulky: State of the IM Nation

This past week, while I was away in London, there was a frenzy of activity around the “instant messaging” client. Microsoft introduced its Microsoft Live Messenger Beta which is some rudimentary form cross talks with Yahoo Messenger. Yahoo opened up its IM and introduced new ways to add widgets to its client. Skype and Paypal did a bit of integration. In other words, all the moves that do nothing but add more bulk to the aging IM client(s).

Back in 2004, when I wrote The Incredible Importance of Instant Messenger, I pointed out that it is going to be a way to get some traction in the VoIP business, and hopefully will help the companies fight off the challenge from upstarts like Skype. More than two years later, most IM clients have VoIP calling. But they have a lot more than that.

I am with Jason when he says that AOL needs to put AIM on a diet. Most IM companies are forgetting that IM is a very personal tool whose emphasis is on instant communication. Everything else comes in the way. The more features that companies – the big three – cram into their products, the more they run the risk of alienating their user base, which frankly might migrate to newer IM options such as the MySpace built in IM.

“If all your friends are on Myspace and with the click of a button you can add 100 of your friends to Myspace IM, why bother with AOL IM anymore?,” writes Rich Greenfield, an analyst with Pali Capital in a note to his clients, and asks. “If AIM e-mail has not really worked, what are the odds that AIM extensions such as AIM Pages or AIM Phoneline will succeed?”

I agree. Those are separate properties and not to be pushed into AIM. It is time for not just AIM but to all other IM companies to rethink their approach. With this on my mind, it was pretty nice to invite Seth Sternberg co-founder and CEO of browser-based instant messaging company Meebo to join Niall and me on our weekly podsession. One of the things he said stuck in my mind – and I paraphrase – in this feature race, none of the companies are actually including things what users want – a quick and easy way to communicate. (You can hear Seth and us debate on our podsession by downloading it from here.)