Wednesday, October 12, 2005

The Amway Salesman in the Driveway

Microsoft, Yahoo Plan Instant-Message Pact

Quite the dramatic headline in today’s Wall Street Journal. You’d think Microsoft and Yahoo had discovered oil and gas on the Internet.

Internet users have long complained that they can't get their instant-messaging services to talk to one other. That is about to change.

Isn’t this exciting?

In a competitive realignment of the heated Internet industry, Microsoft Corp. and Yahoo Inc. are expected to announce today that consumers using their free communications services -- including instant messaging and computer-to-computer voice calling -- will be able to communicate directly with each other for the first time, say people familiar with the matter.

Now if indeed anybody actually used Microsoft and Yahoo’s Instant Message service, this might be big news.

The expected alliance represents a breakthrough in the fractured market for instant messaging…. In the past, consumers using Yahoo's Messenger instant messaging could communicate only with other Yahoo users and not with those using instant-messaging software from Microsoft or others; the same restrictions applied to those who used Microsoft's MSN Messenger instant-messaging software.

The fact is, however, I know exactly one person who uses “Microsoft’s MSN Messenger instant-messenger software,” as the WSJ calls it. Just one—compared with the 56 individuals who are, at this moment, working online according to my AOL Buddy List, not to mention the other 64 who are offline at the moment.

But you wouldn’t know that almost nobody actually uses Microsoft or Yahoo’s IM from today’s WSJ story:

The expected linkup of Microsoft's and Yahoo's communications services would immediately challenge the leading instant-messaging market share of Time Warner
Inc.'s America Online unit.

AOL has a 56% market share world-wide, according to research firm Radicati Group Inc. It has long resisted letting users of other instant-messaging services connect with its own. A combined Yahoo and Microsoft could command 44% of the global instant-messaging market…

That is, as they say, corrupt data, as my daughters and their six million IM-dependant friends could have told the Journal reporter.

For example, I actually do have Microsoft Messenger on my home computer.

But I never asked for it. Rather, Microsoft Messenger insinuates itself on anybody who uses Microsoft’s email product. Every time my computer boots up, Microsoft Messenger is there, lurking, like an Amway salesman in the driveway.

And I ignore it, like I ignore that Amway salesman, hoping it will go away.

The trouble is I actually know one person who uses Microsoft Messenger, and therefore I keep it there, just in case he pings me, which happens once a week or so.

Meanwhile, at this very moment, my IM icon is flashing with the messages of a half-dozen individuals who, like myself, find instant messaging to be far superior to working the phones.

So Microsoft and Yahoo can combine their two instant-message services, and on paper it might show they command a 44% market share “of the global instant-messaging market” on paper.

But in the real world, this alliance looks to me like another one of those high-tech alliances we read about from time-to-time—like Sun Microsystem’s “alliance” with Microsoft, or Google, or whatever successful company Sun is trying to attach itself to these days.

Which is to say, nothing important.

Why, I haven’t even gotten an instant message about it this morning.

Jeff Matthews
I Am Not Making This Up

© 2005 Jeff Matthews

The content contained in this blog represents the opinions of Mr. Matthews. Mr. Matthews also acts as an advisor and clients advised by Mr. Matthews may hold either long or short positions in securities of various companies discussed in the blog based upon Mr. Matthews' recommendations.



Actually I have used AOL and MSN and they don't compare. AOL is buggy and I can't count on it. While MSN is pretty reliable.

Peter said...

Actually, what the really techie friends I have do is sign up for each messenger program and then use one of those other programs that unite them all so that if you IM me from MSN, I get it on AOL or whatever I use. This is all to say that I agree that this alliance is a non-event.

Dan said...

I have aol, yahoo and msn messenger accounts. I use trillian to keep them all straight. Trillian allows me to use all services on one messaging program. It also allows for icq accounts. Try it.

Chris Fischer said...

Jeff is right - I read that article this morning and thought the same exact thing. As a 20-something who was in college not all that long ago, no one uses anything but instant messenger.

Some people have accounts on all the different services and use them all, but they tend to be techie's, not everyday type users.

AIM is one of those things like you use not because it may be the best, quickest, most user friendly, but because everyone else uses it. Kind of like Ebay.

kevinmr said...

Jeff - You are a bit too flippant when deriding MSN. You are mistaken to asume your sample of users reflects the true usage of messenger type software. Most individuals I know use multiple packages.

Jeff Matthews said...

"kevinmr" is right: I may indeed be too flippant about this.

So let's take a poll showing per-cent of your time using AOL/MSN/Yahoo/Combined instant message.

Mine is as follows: 99.5%/0.5%/O%/0%

Honorable Justice Jorge P. Smythe said...

I use Yahoo about 75% at this job. At the last job I used AIM about 98%.

At this job we used MSN until it started repeatedly crashing for everyone, that's when we switched to yahoo.

I use trillian so I log into aim/msn/icq/yahoo all at once and use the same tool to send.

So as of right now I'm:

What do you mean by your combined category?

Jeff Matthews said...

By "combined" I mean a product like Trillian that combines them all.

Sorry for the confusion and thanks for the response.

Kevin H. Stecyk said...

I found Jeff's article interesting because it is directly counter to my experience. I don't use IM a lot, but when I do, it is MSN. Whenever someone asks me for my IM, it is MSN. This includes people from foreign countries outside of North America as well.

AOL/MSN/Yahoo/Combined instant message


gvtucker said...

The only IM program I use is Bloomberg's, which isn't even on your list.

cdub said...

I think the most interesting take-away from the artcile is that MSN is not teaming up with AOL. After all the recent chatter (which, to me, makes sense) of an AOL-MSN combo, it seems strange that MSN would join up with Yahoo. Not a good move, IMO.

For the record, 95 AIM/5 MSN

Johnny said...

I use Trillian to hold it together with about 50% Yahoooooo and 50% AIM, I am waiting for Trillian to include Google in their software so it will be complete, although no-one is using that yet.

Achal said...


Charles W said...

All the techie guys I know use AOL or Yahoo while many companies and people who are not too computer literate tend to use MSN in my experience. The funny thing is Yahoo clearly has the best product if anyone has used all 3 but it is all but useless. Chalk it up to network effects. Personally I am not sure this really means anything for the AOL Microsoft news because AOL knows that it’s instant messenger is just about it’s only redeeming quality and the instant messenger really is not that good unless you compare it to Microsoft but than again Microsoft always has the worst product.

Charles W said...

All the techie guys I know use AOL or Yahoo while many companies and people who are not too computer literate tend to use MSN in my experience. The funny thing is Yahoo clearly has the best product if anyone has used all 3 but it is all but useless. Chalk it up to network effects. Personally I am not sure this really means anything for the AOL Microsoft news because AOL knows that it’s instant messenger is just about it’s only redeeming quality and the instant messenger really is not that good unless you compare it to Microsoft but than again Microsoft always has the worst product.

Kevin H. Stecyk said...

Charles, while everyone is entitled to their opinion, I have tried all three IMs and have found MSN to be best for my needs. And again, everyone that I communicate with uses it, including those of us who are very computer literate. In fact, I don't like AOL's IM and would refuse to use it unless I used Trillian to access it. I simply don't like its user interface.

I had to fire up AOL again to remind myself of what it looked like. In the process, I discovered that I am using an outdated version 5.9. I am still not interested in upgradeing it. I'll stick with MSN or with Trillian if my needs change.

AllenCap said...

Aol -100%
Yahoo- 0%
MSN - 0%
Combined- 100%

I use a combined product for work reasons but i can't think of a single person on the street that uses anything besides aol or bloomberg. My little brother who is two years out of school and still has 100 im buddies from high school and college says no one uses anything else.

Sam S. Park said...


Interesting post. I've been using and following instant messengers and their development for awhile. Here's what I've discovered:

-AIM is favored by younger users, but its popularity seems to be on the decline.

-MSN has found itself useful in the corporate world. I know for a fact that employees working for large conglomerates, who need to communicate with their counterparts in foreign countries, fully utilize MSN's instant messenger. This is a huge cost savings method for those who conduct business outside the country... think about those in the U.S. who need to communicate with the manufacturing department (most of which have gone overseas). Now think about what the phone bill would cost without instant messengers. Here's probably what's going on... make corporate users rely on MSN IM product so they can support Microsoft's continued dominance/monopoly. If you think about it, MSN's instant messenger is not really free... you'll pay for it one way or another.

-Yahoo's messenger seems to be slowly taking away MSN's users. Which leads me to believe why MSN wants to do this deal with Yahoo. They probably also realized that Trillian poses a threat.

Let's face it, IMing isn't just for kids anymore. You really don't want to get left behind in this communication-driven world. Sensitive data flow through these means, and IM developers will need to prove their security protection abilities against hackers. I will also note that I have seen the webcam function being used more often. Video conferencing is right around the corner. Who will take that market? AIM, MSN or perhaps Skype...

dthorn said...

100% Trillian - I am surprised how many mentions it gets. Though I shouldnt be - I have contacts on all the services and it helped reduce the clutter and increase ease of use. I think Mossberg reviewed it a while ago? In any case, I suppose I could go through my contacts and count how many are on each service, but who cares? It certainly never occured to me think about which one is better/worse one thing I know for sure is that they are all FREE. Bully for AOL for having 56% mkt share of a FREE product. It is all too much, its giving me fuzzy warm memories of 1999....

Johnny Debacle said...

Home is

30%/0%/5%/0//Google 65%

Since it came out my most intelligient friends and I have used GTalk exclusively. I put up an away message on Gtalk indicating that I had forsaken AIM forever.



We are too worried about having communication logged and possibly used against us in litigation. Overly paranoid imo. It's a mistake, IM is the most efficient communication, because the barriers from initiating a thought to the recipient receiving it are so small.

kevinmr said...

Hate to say it because it makes me feel as if I have just admitted to buying an InSync album:

With the caveat I am not a big IM user.

Project_Guru said...

My wife and I work for two extremely large corporations and the crackdown is beginning these days. I have typically used Yahoo myself with a bit of AOL and some MSN. Now both of our companies are mandating that we can no longer use any of these on our corporate network and must use internally provided software. My company is using something called Real Time Collaborator and my wife's is using something else. I know one of my client's that uses Notes for email only allows employees to use Sametime (the Lotus product). I think this is the real trend at the workplace in large companies that want to 'keep and eye' on IM.

MD said...

Henry Blodgett references some Radicati group data that puts AOL Im share at 56%; MSN 25%; Yahoo! 19%.

So AOL 56% vs MSN/Yahoo! at 44%.


k9thunder said...

"Every time my computer boots up, Microsoft Messenger is there, lurking, like an Amway salesman in the driveway.

And I ignore it, like I ignore that Amway salesman, hoping it will go away."

Good 1 Jeff! Nice humor!

How about pestering Amway salesman trying to recruit you or worse invite you to their meeting to get brain washed to join the "cult" and buy the useless inspirational tapes!

Here is some advice on getting rid of the pest from loading up.

Go to run then type msconfig. Go to start up tab and disable all JUNKS except for firewall and antivirus and voila you boot faster and prevent junk from running in the background.

PS - Hey how about your insights on Patty's latest PR blitz?

Anonymous said...

I know a ton of people that use MSN and YHOO. In fact I know a ton of people that use YHOO just for chatting with our Blackberries. AOL is for kids sorry to break it to you. Every time I boot AOL up I get all those stupid pop-ups and BS windows that are so annoying too. Also for what it is worth if you want to do networking and business activities MSN and YHOO are way superior to AOL. When I lived in Germany I was using MSN to have voice chat with people back home all the time. Also in college when it came down to transferring files between students we all used MSN and YHOO which are far better for completing that task. Heck Aol is hacker heaven too. The only use for AOL I have is for people that I consider to be the most least tech savvy friends I have, cause they all use AOL from back in the days of dial up. I would use Trillian but frankly I have multiple monitors and I don’t mind having all of the IM platforms running. I like to control who sees me online on each one. Oh for what it is worth I was very happy to hear the news of a MSN/YHOO combination. Now my BlackBerry is complete.

MSN -60%

Yahoo 39%

(Yahoo 100% Wireless handheld)

AOL 1%

Sam S. Park said...


I didn't know Henry Blodget was still analyzing techs. How is his blog analysis without the pressures from you know whom? I should check it out.

Jeff Matthews said...

Hate to break the news but the Blodgett data was in the WSJ article I quoted from, including the 56% AOL and Yahoo/MSN 44%. That was the starting point for my post.

However, based on these responses I would say the business world is far more fractured than I had expected, and far less AOL-centric than the high-school student world, in which AOL has virtually 100% market share, and on Wall Street--which is my world--where AOL appears to have most of the IM users.

Very interesting and much appreciated!

MD said...


It is my attention to detail that has allowed me to scale the heights of the business world. : )


BelowTheCrowd said...

I used Trillian as my client for all instant messaging, mostly because I have found that the bloatware pushed by AOL and YHOO is just too buggy and full of unwanted advertising and other features. Trillian allows me to communicate with all my contacts in a simple interface, sans advertising, sans video messaging, sans all the other crap those guys are pushing.

AIM had a reall nasty reputation for bloat-ware that installed all sort of other unwanted AOL bits on your machine that were virtually impossible to get rid of, which is why many of my friends avoided it at all costs. Not sure if this has changed much in the past year or two.

My use:

75% Yahoo IM
24% AIM
1% MSN
100% through a combined interface (Trillian).


rebelmo said...

are those numbers for global market share? or just in the US?

I would hazard to guess that MSN and Yahoo are much bigger outside the US.

btb73 said...

I exclusively use MSN, and all 37 people at my workplace does too(a danish internet portal). I dont personally know anyone that uses AOL or any of the others messengers.

But I do have a few friends that uses trillian and miranda, so I assume they might.

Aaron Koral said...

Jeff: I guess I must really be "illiterate" as I have never used an instant messaging service like AOL or Yahoo. But then again, I always figure a good letter/email or quick phone call on my cell phone allows me to "reach out and touch someone" as that old ATT ad used to say...

One thing that intrigues me about the partnership is why would Terry Semel partner with Bill Gates at Microsoft instead of with Dick Parsons at AOL-Time Warner? Maybe there's some "bad blood" between Mr. Semel and Mr. Parsons during TWX's post-AOL merger days (I could be wrong though).

Richard said...

I think AIM is very US centric. I don't know a single person on AIM

Jim Hohl said...

I agree with previous posters that AIM is not as heavily used outside the US, while Yahoo's and MSN's IM services are HUGE outside of the US. MSFT and YHOO are on to something that AOL is missing.

tautknot said...

Working in several hospital/healthcare settings: 0% MSN messenger/25% AOL/75% Yahoo IM.

Because Yahoo works on any computer and if its not on there, you just check your email and get it. Ease of use.

onetimer999 said...

JM may not make it up - but his ideas sound idiotic ...not that I'm trying to personally attack JM - but commenting solely on how the ideas he expresses come across to me. AOL exists within a closed, for fee, realm using dying technology. Other options strive to break beyond these barriers and while perhaps not perfect at this point, poised for continual improvement. The reference to an Amway salesman in the driveway can only be made up (I thought he didn't make this up?) - if only because it is so factually incorrect in so many's two for a start: One, there's never been an 'Amway salesman' - if only because that company has never hired staff to sell their products. Two, Amway itself has ceased to exist in the U.S. since the late 1990's - having morphed beyond their 1950's business model. Like the IM world -- their business model is not perfect -- but has demonstrated and is poised for continual improvement in an open-architecture world...something AOL is not.

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