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AOL Aligns With Apple in Instant Messaging Venture

July 30, 1999|LESLIE HELM | TIMES STAFF WRITER

Enlisting an important ally in its intensifying battle against Microsoft, America Online said Thursday it would work closely with Apple Computer to develop new enhancements to its Instant Messenger software to serve users of Apple's Macintosh computers.

The two companies declined to disclose terms of the agreement, but analysts believe the deal is an effort by America Online to build support for its messaging service as it pursues its much-publicized battle with rival systems introduced last week by Microsoft and Yahoo.

Instant messaging software enables users to see who among a selected group of friends and acquaintances is online at any moment to chat with them. AOL's Instant Messenger software is the most popular system, with 40 million users worldwide. The company also owns ICQ, a rival system with 38 million users.

When Microsoft released its own MSN Messenger Service last week, its key feature was the ability of users on its Microsoft Network to communicate with users of AOL's Instant Messenger system without first joining AOL, a competing service.

Since then, AOL has altered its software five times to block those messages, citing privacy and security concerns. Each time Microsoft has quickly responded with fixes that overcome the blockade.

Analysts speculate that Apple allied itself with AOL so that the leading online service would give a higher priority to developing products and services designed to operate on the Macintosh.

In a similar agreement two years ago, Apple agreed to use Microsoft's Internet Explorer browser and support Microsoft's version of the Java language in exchange for a Microsoft investment in Apple of $150 million and a commitment by the software giant to continue developing its important Office suite of productivity applications for the Macintosh.

"AOL has the biggest and best instant messaging service in the world," said Steve Jobs, Apple's interim chief executive, explaining Apple's motivation for hooking up with AOL.

In an effort to portray itself as a consumer advocate rather than a spoiler, AOL also announced Thursday it was forming an "advisory group" to put "brainpower" behind efforts to make various instant messaging systems connect with each other. So far the group includes Apple Chief Executive Steve Jobs; Yossi Vardi, founder of ICQ; AOL Chief Scientist Marc Andreessen; and Novell Chief Executive Eric Schmidt.

For AOL, the Apple alliance could prove a foil against those who criticize AOL for closing off access to its instant messaging users even as it seeks to force AT&T to offer open access to its high-speed cable network.

"It's almost as if AOL is saying, 'Hey, we're willing to license this software. We just don't want to be hacked,"' said Barry Parr, analyst at IDC, a Framingham, Mass.-based market researcher.

AOL sent a letter to Microsoft Friday asking the software giant to negotiate "legitimate arrangements" that would allow MSN Messenger users to send instant messages to AOL subscribers.

Microsoft rebuffed that request and instead asked AOL to join the effort by Internet Engineering Task Force, an industrywide standards group, to create open standards that would allow the many instant messaging systems now in use to communicate with one another.

AOL's deal makes it less likely Apple will support the standards effort and could help delay its widespread adoption.

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