October 13, 2005

Yahoo and MS announce IMs compatable…what does this mean for AOL, Google and Tencent?

Filed under: IM,Tencent — Administrator @ 9:59 am

Microsoft and Yahoo! announced they would make their IMs compatible, allowing users to seamlessly communicate between platforms regardless of which IM you’re on. Market analysts estimate that Yahoo! has 25m users and MS has 25m user; the leading IM in the US is AOL with 50m users.

Now consider that Tencent’s QQ IM has over 180m active users…

There are a couple real interesting things from this:

(1) MS has been speaking with AOL about merging operations, if this does in fact transpire that would increase MS/YAHOO/AOL/ICQ user base to 75m, positioning the group as the largest IM platform outside of Tencent;

(2) Google’s IM offering, Google Talk, will become irrelevant in near to medium term, perhaps forcing Google to move aggressively in a different direction; we think this might be to expand their already existing relationship with Tencent; it is clear Google’s traction in China is weak at best (as is MS), however a bolder relationship with Tencent would propel Google in a market leader position.

(3) Google-Comcast just announced they want to invest in AOL’s web business…is this more to block MSN or does Google-Comcast truly want to be investors in AOL…does this open the door for Google Talk to hook into AOL’s IM universe?

We think Tencent is one of the best positioned Internet companies in China, if not the world; we don’t buy into the fact that Microsoft’s MSN is a threat to any of the incumbents, especially in China, however if Google and Tencent want to strike hard and fast at any possible MS/YAHOO (AOL?) joint IM force…a deal whereby Google becomes a shareholder in Tencent would do it…

And then again…you could alway just go here to meebo.com

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