Google's Move into IM

The search giant's new IM product, Talk, is newsworthy -- but probably won't overturn the telecommunications industry. In fact, the recent move by Skype may be more ground-breaking.

It was quite a week for Google watchers -- which means just about everyone. First, the search-engine giant launched an update to its desktop search tool, called Google Desktop 2. Then the company announced its first-ever instant messaging telecommunications product, Google Talk.

Desktop 2 will be watched closely by companies such as Microsoft -- which likes to think it has eminent domain over users' desktops. But the announcement of Google Talk and its subsequent coverage has eclipsed that product, most likely because Talk is a departure from Google's primary focus: searching.

How big a departure is it? The initial beta version of Talk, available only to those who have an account with Google's email service, gMail, doesn't even feature an Internet search component -- something all the major competitors, Yahoo Messenger, AOL IM, and Microsoft's MSN Messenger, offer. It's a curious omission, given that Google rose to prominence via its search technology.

America Online is, by far, the current leader in the instant messaging space, with 41.6 million active users, according to comScore Media Metrix. Yahoo placed second, with 19.1 million users, and MSN Messenger had 14.1 million.

Google's Talk product announcement has also stirred up one of the more popular memes in our culture: the impending doom of the traditional telecommunications industry caused by the growth of voice over Internet protocol (VoIP) technology. That's because Google Talk features voice capability, allowing users with a microphone and headset to talk with one another. Yet that capability is also offered by the major competing IM products. So banner headlines like the one this week in the Financial Times, "Web giant takes on telecoms rivals," is quite misguided.

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"VoIP is not a threat that's going to put telecommunications companies out of business," says Jeff Kagan, a telecommunications analyst and president of The Kagan Group. "VoIP is a change wave, part of a 20-year transformation that the telecommunications industry is in right now."

That "change wave," as Kagan puts it, got a little closer to cresting this week -- but not from the Google announcement. Skype, the most popular VoIP application anywhere in the world right now -- with over 50 million registered users in just two years -- will celebrate its two-year anniversary next week. To mark the occasion, it will open up its technology platform, allowing any user to incorporate Skype into their Web pages and applications.