From...

December 6, 1999
Web posted at: 9:22 a.m. EST (1422 GMT)

by Michael Learmonth

(IDG) -- Within a year, devotees of instant messaging will be able to send far more than text to members of their "buddy lists." Soon that instant message might be a voice call from a telephone or another PC. It may also contain advertising specifically targeted to people based on their Internet browsing history.

A flurry of deals announced this week demonstrates that the battle for the buddy list is heating up. Competing companies are furiously adding features to their chat clients, vying to achieve a critical mass of users.

On Thursday, America Online announced an agreement with Net2Phone to bring telephony to AOL Instant Messaging. Under the terms of the agreement, Net2Phone and AOL will collaborate to develop features that will allow AIM users to place and receive telephone calls through the service.

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On Wednesday, Internet giant CMGI added Tribal Voice to its stable of Internet companies. Tribal Voice makes PowWow, an instant messaging client that's been downloaded by 5 million users.

CMGI will merge Tribal Voice with previously acquired Activerse, which provides instant messaging to intranets and Internet-based workgroups. Another synergy is with a different CMGI holding, Engage Technologies, which provides targeted advertising based on users' surfing and shopping habits. In the future, instant messages will contain advertising targeted specifically to the recipient.

AOL's AIM contains a generic ad that goes to everyone. The company's other instant-message service, ICQ, which AOL bought when it acquired Israel-based Mirabilis over a year ago, contains a more targeted ad, based on information delved from a number of prompts a user must wade through before downloading the software.

"ICQ is absolutely opt-in," AOL spokesperson Tricia Primrose says. "AOL's privacy policy says we can't use navigational information in any way."

Urgent Messaging

Ever since instant messaging started to catch on a few years ago, millions of users have downloaded chat software offered by AOL, Microsoft, Yahoo, and Tribal Voice, deeming regular e-mail far too slow for an urgent communiqué to the "buddy list." Before long chat software was being used for far more than typing messages. Some chat users program their desktops to notify them when a stock hits a certain price, when a winning auction bid is posted, or even when a home security alarm goes off.

As instant messaging is used to keep users updated on sports scores, breaking news, and other events, it has become more like an Internet browser for real-time information.

And according to Steve Sigler, vice president for business development at Activerse, as instant messaging gets more browserlike, so will the advertising that messages contain.

"We could target ads based on Web behavior," says Sigler. "Engage provides that marketing opportunity. CMGI is equipped to do it in a privacy-protected way."

The information gathered is attached to an anonymous ID, not to a name, Sigler says.

But AOL's Primrose says that while all users of AOL chat software receive ads, AOL has no plans to begin targeting the ads based on Web surfing history.

AOL is by far the largest provider of instant messaging services. Its AIM service has 37 million users. Its ICQ service, composed largely of users who don't belong to AOL, has 50 million users, 10 times as many as Tribal Voice's PowWow.