IM Monopoly Threatens E-Commerce

Not so fast! What was supposed to be a slam dunk became a waiting game when the U.S. Federal Communications Commission (FCC) hesitated in approving the US$100 billion merger of America Online (AOL) and Time Warner.

Consent was expected to be a mere formality, but word has it that at least one commissioner is worried that AOL dominates the instant messaging (IM) world a bit too much. It’s a reasonable concern. And it’s one that e-commerce should sit up and pay attention to.

At first, instant messaging seemed simply like a neat hyperactive version of e-mail, more evolution than revolution. However, as someone who has used it extensively and followed its adoption by e-tailers, I know that instant messaging has the ability to change how customers and companies communicate.

So, let me send out cheers (temporary ones, at least) to the FCC. Letting AOL get by without close scrutiny of its IM plans — or better yet, a pledge to open up its platform so it can be compatible with others — would have been a big mistake.

Instant Gratification

Instant messaging is so far superior to the old online chat — which was supposedly instant — that it hardly bears mentioning. Anyone who ever had a conversation the old way knows the frustration of asking a question and waiting as questions asked 10 minutes earlier get answered.

Instant messaging, on the other hand, is intuitive, neat and simple. Unless you lack patience, it’s simple to ping questions-and-answers back-and-forth in the proper order. The fact that only two people can use it at once is only a minor drawback.

Perhaps the best possible use for instant messaging, however, is to open up between customer and company a line of communication that is cheap, fast and versatile.

Putting the Snail in Mail

E-mail just doesn’t cut it for customer service. Dash off a note to the customer care division of your favorite company and wait. If you’re lucky, you’ll get an automatically generated response pretty quickly. But that answer is likely to do little more than tell you to be patient, that you’ll hear from the business again in, say, 48 hours or so.

Now consider the same process with instant messaging. Not only will you get a live response in real time, but that response might actually answer the question you’re looking for. Some smaller companies have already embraced instant messaging as a way for customers and other parties to reach key employees.

Of course, having enough well-trained staff on hand to pull this off on a large-scale basis is a challenge for e-tailers, retailers, service companies and everyone in between. But someday, I believe, instant messaging will be a standard means of extending customer service reach.

Lock Step

With this much at stake, if everyone ends up bound to the same software program, charges will fly against AOL much the same way they have against Microsoft for so long. And with good reason.

We already know that AOL dominates the online world. By breaking its IM product off and packaging it on PCs, it has gone one step further.

Others have similar products, but none is as smooth as AOL’s. And much more important, none have the volume of people already hooked up and signed on as AOL.

Imagine a world where telephone systems controlled by one company do not communicate with those run by another. It just wouldn’t work. And it won’t work with instant messaging.

Do the Right Thing

And that’s how it came down to the FCC, which found itself deciding how much like a telephone system instant messaging really is. If it is a phone system, they can regulate it and force AOL to open it up. Or, they can cajole AOL to do the work itself. Either way, the FCC can do something.

Companies have been trying to get AOL to open up for some time, but they’ve been in no big hurry. Now, however, it’s time for regulators to use their power to do what other IM companies couldn’t get done with diplomacy. And it’s time for AOL to do the right thing, voluntarily or involuntarily.

What do you think? Let’s talk about it.