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Social networking melds with videoconferencing

Can you see me now? A small company called Paltalk is trying to walk a line somewhere between MySpace and YouTube.

Boaz Frankel loves to talk politics. During the recent elections, the computer consultant knew debate would be burning up blogs, message boards and chat rooms.

Instead, he turned to Paltalk, another online soapbox from which to speak his peace--one that allowed his voice not only to be heard but also enabled his audience to see his face.

Paltalk is a profitable, 8-year-old company trying to wed two of the hottest trends on the Internet: social networking and video.

"Voice is OK, but it lacks the richness of sight."
--Joel Smernoff, Paltalk president

Company executives hope they'll be at the forefront of the next wave of Internet excitement. What Skype was to the early days of voice over Internet Protocol (VoIP) communications and YouTube is to video sharing, Paltalk wants to be to a new generation of companies that allow users to see multiple people transmitting video on their Webcams just as easily as you could see a group of people chatting in virtual worlds like Second Life.

By all indications, humans enjoy interacting online. Social-networking and video-sharing sites such as MySpace and YouTube are among the most trafficked on the Web. But communication on the Internet is still largely dependent on text--pecking out missives via instant message or e-mail.

What's lacking are faces connected to voices, according to Joel Smernoff, Paltalk's president and chief operating officer. He said the New York City company wants people to interact online more like they do in face-to-face discussions. When a group of friends get together in person, they can see and hear each other. Paltalk can re-create that experience on the Web.

"Lots of companies are doing a good job connecting people one-on-one," Smernoff said. "What we're doing is connecting one to many. We also call this group-video application. It's really allowing users to build a community where people genuinely know each other."

To illustrate his point, Smernoff, in a Paltalk demonstration for CNET, showed a chat room where an instructor was teaching students from different parts of the country to speak French. The teacher can see each of her pupil's faces on her laptop and they can see hers, as well as their classmates'. Frankel, who lives in Los Angeles, said he uses Paltalk to give demonstrations to customers or to help troubleshoot problems.

Can you see me now?
Online videoconferencing has been around for years, of course, but until now it hasn't been applied on a wide scale to social networking. Big corporations were typically the only ones that could afford to pay for the service, according to Smernoff.

Of course, big companies may be the only ones with a need for videoconferencing, notes Jennifer Simpson, an analyst with research firm the Yankee Group. Her consumer studies don't indicate a large demand for online collaborative tools, she said. Such services may eventually catch on, Simpson said, but she isn't convinced video will be the big winner. Voice services that allow people to participate in online group discussions stand a better chance of catching on, at least in the near term, according to Simpson.

"I think voice has a better chance," Simpson said. "There's already a bunch of companies providing voice and most computers are equipped with microphones. Very few of them have built-in Webcams. Right now, only a small percentage of Internet users own Webcams."

That doesn't spook Smernoff. He said YouTube and other video companies are successful because people want images.

"Voice is OK, but it lacks the richness of sight," Smernoff said. "I think that's don't have an audio YouTube. Humans like to see faces and expression."

Founded in 1998, Paltalk began as a small player in the instant-messaging sector. Profitable since 2001, Paltalk began in the same year to build the foundation for group-centric video chat.

To get started, visitors must download software. Any user can create a chat room on any subject and invite up to 3,000 people in to discuss the subject through voice, video and text.

Everything is free except the ability to view the video feeds from others in the community. To do that, you have to pay $15 a month or $60 a year. Room owners can moderate their groups to make sure they can run their "clubhouse the way they want to," said Smernoff. They can even boot people out.

When someone enters, their user name appears. An icon will indicate whether the person is video-enabled. All a person needs to do is click on the icon and the person appears. Click on another person's icon and he, too, will pop up.

Leah McLellan, 51, likes to go into the karaoke chat rooms. Retired after working in developmental psychiatry, McLellan says the video and audio on Paltalk surprised her when she first started using the product two years ago.

"They are crystal clear," she said. What McLellan likes most about the service is that if she doesn't want people to see her, she just pushes a button and her video feed is cut off. "If I want to chat with someone one-on-one I can...They allow me to control my privacy completely."

Privacy is very important to people, and fear of losing it may be another hurdle Paltalk has to overcome, said the Yankee Group's Simpson.

Frankel said he owns a Webcam, but sometimes prefers to converse on Paltalk in audio-only mode. Sometimes, when he's arguing politics, he prefers to stay anonymous.

"I don't have a specific reason," said Frankel, 47. "Chat programs are still a new concept. People like to keep their anonymity. It gives them more freedom to say what's on their mind."

Paltalk has begun offering a videoconferencing service that targets businesses. The company is also betting that other social-networking services will want Paltalk to create video chat rooms for them.

"The cool thing is we can take our little video chat rooms and we can embed them in other people's sites," Smernoff said. "We can embed real time group video chat in places where online community already exist, such as MySpace or YouTube or CBS Sportsline. That means someone interested in surfing can build a room and invite other MySpaces users to join them."