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Commentary: The power of IM's "identity vessel"

Instant messaging will be the vehicle by which users adopt universally readable identity--a phenomenon with far-reaching implications.

    By Whit Andrews and David Smith, Gartner Analysts

    Instant messaging will be the vehicle by which users adopt universally readable identity, and that identity will make Microsoft's MSN Messenger and America Online's related assets, including AOL Instant Messenger and ICQ, significant far beyond their immediate revenue potential.

    See news story:
    Microsoft readies "Hailstorm" against AOL
    The industry's focus on this immediate potential of IM software and network function (such as advertising and shopping) is shortsighted. IM user identities will serve as important, ubiquitous, universally readable formats for recognition of, and communication with, other individuals.

    Initiatives such as Microsoft's Hailstorm mark a first step in introducing global identity and global-identity management. By year-end 2002, Gartner expects that Microsoft (with its Passport services integrated into a federated naming scheme using its Active Directory) and AOL (through its iPlanet alliance with Sun Microsystems) will introduce enterprise products enabling the use of IM and interoperability with screen names.

    The value of global identity
    This global-identity management will become more and more important as users increasingly perform online business functions that require business identity and credentials when not on business premises, and as they perform personal tasks with their personal identities while at work. Global identities may expand to include those not tied to human workers, such as applications or machines that must be able to communicate in truncated dialogue with humans.

    IM's usefulness starts in that it enables online users to communicate immediately and in real time with each other, one to one or in a group. With IM, users activate client software that reaches out to a central server and registers the user as being online. This user registration and mapping to his or her screen name is the "identity vessel."

    The nature of IM allows the technology to be turned on whenever a user wants and to be activated in a variety of environments not limited to a single PC. However, IM requires authentication and security to reach its potential. In addition, users who establish identities through IM face substantial hurdles in abandoning one identity for another, because of the difficulty of informing all their peers of the change.

    These switching hurdles will only increase as third parties deepen reliance on an identity "flag" to recognize consumers returning to their Web sites. Today, many sites use an e-mail address for recognition if the stored user data is sensitive, or they use a browser cookie if it is not. IM clients, however, use living "tokens" that require the user to sign in actively; this could address both the need for immediate identification (as it is provided by the cookie) and the need for authentication (usually via a username or e-mail address, and a password).

    Gartner sees a significant potential for partnerships or mergers between companies such as Yahoo and Novell to combine two critical sets of assets--users and infrastructure. Yahoo and other media and portal players have substantial screen-name user bases but lack an infrastructure vessel. Novell and other technology and infrastructure providers have good technology infrastructure but lack the means to secure a user base.

    Key ingredients on hand at Microsoft, AOL
    Microsoft and AOL, meanwhile, already have the key ingredients to leverage IM screen names into strategic assets. AOL has a significant head start, with 23 million users and the ability to limit interoperability between IM systems. However, AOL has focused so much on its merger with Time Warner that it has not paid significant attention to iPlanet opportunities. (For example, AOL missed the big announcement of the Sun ONE Web service initiative earlier this month.)

    In 2001, Gartner believes, AOL will take advantage of iPlanet, particularly in working with Sun to exploit its IM assets; it will then have the critical ingredients for success. AOL's challenges include overcoming this inattention to iPlanet and developing needed modifications to AIM since the screen-name functions were not designed to perform the recognition functions it may need to perform in the future.

    Microsoft is better positioned than AOL on the technology side to exploit the opportunity. Microsoft is not attempting to position IM as a complete development platform. Rather, IM's benefits could include more ubiquitous and effortless personalization as well as easier access to relevant data. To realize them, Microsoft can bring to bear its enormous clout with developers.

    Microsoft's Passport was designed to be more than just a screen name. With the partial success of MSN and its IM client (13 million users), Microsoft is a contender in the IM market and has hundreds of significant partners and users of Passport, including Dell Computer. Although its IM user base is much smaller than AOL's, Microsoft does claim 120 million Passport users. While not negating AOL's advantage in IM users, that reach is quite relevant, especially because Passport was designed for the identity purpose with which it has had some success.

    Gartner believes that Microsoft should further exploit Passport by making its .Net initiative successful. That would drive Passport use and form a virtual circle with .Net-enabled products.

    (For related commentary on Microsoft's .Net platform, see TechRepublic.com--free registration required.)

    Entire contents, Copyright ? 2001 Gartner Group, Inc. All rights reserved. The information contained herein represents Gartner's initial commentary and analysis and has been obtained from sources believed to be reliable. Positions taken are subject to change as more information becomes available and further analysis is undertaken. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of the information. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof.