Microsoft demoed Windows Live Messenger (WLM) beta on the show floor. (Snapshots coming soon.) Better looking than MSN Messenger 7.5 (lots of cutesy user interface removed, panes better organized) but it's a small point. One rep claimed the Messenger Beta is better than Skype because:

• audio quality ("we played with the codecs"),
  
• integration of identity and contacts across the Live family (hotmail/live mail),
  
• third party apps delivered through the system, and
  
• having more users (about 200 million) than anyone else.

The team seems to treat Messenger as a walled garden, like US mobile carriers. The product is closed except to partners who pay for the privelege or who have something specific the Messenger team wants. For example, they were bragging about two handset partners who'd come aboard, but WLM doesn't publish an SDK (software development kit). So the hundreds of handset manufacturers here at CES can't tightly integrate their products with WLM. Like carriers, WLM sells advertising right in the user interface, polluting with distractions what for many is their dominant communication tool, and with no way to turn them off. Even the exclusive software developers allowed inside the garden walls cannot build telephony plug-ins at all. This is far from being a strategic communications platform that others can build on.

I have to agree with him about the convenience and power of a common Passport/Live identity. The convenience of single sign-on is a great draw. And having more people in your ID cloud and in connected clouds (like Yahoo!'s someday soon) builds critical mass. It is unclear, by the way, if the IM interop agreement with Yahoo! extends to voice.

Someone in the crowd pressed him on the number of users, asking specifics on the number of active voice/telephony users. He didn't know. I suspect, given the low emphasis of voice in past UIs, there is an infinitessimal but quickly growing body of MSN voice regulars. Helping the average MSN user become multimodal (text to voice) will be a challenge as steep as Skype's (voice to video).

Two other points: Windows Live Messenger voice calls will not support voice conferencing. And users must cut a deal with MCI for call-out services. Both put Microsoft at a disadvantage vs. Skype.

But I'm not worried for Microsoft. Most Microsoft products take years of iteration to mature, and their move to thrice yearly release cycles will help Microsoft overcome these weakness. Their platforming tradition may prevail over short-term walled garden opportunities. What's more, the power of incumbency is real, as is their willingness to explore new ideas. Skype's race for users, features, and new ideas is still a very high stakes game.

See also: the blog, the product page, the faq.

Is a little competition still a good thing?

Both Microsoft and Yahoo are deploying dial-out services in their Messenger clients. How do you compete when it comes to call termination? Four points:

1. Rates (converging to flat and free)
2. Reach (going worldwide)
3. Quality (expectations raised by GIPS audio quality)
4. Everything else

It's the everything else that'll matter. Bundling, niching, creative use of call metadata, convenience, caller ID pass through; they and the rest are secondary to making your softphone start up with Windows and be the conversation tool of choice.

Susan Mernit

"One of the ways Yahoo can compete with Google, IMHO, isn't to try to match then in product sets and feature to feature upgrades but to figure out what they can do differently--and do it amazingly well--and integration of tools across media and life management platforms seems like one smart way to go in this regard."

Q. Did the Microsoft-Yahoo IM interoperability agreement include voice calls?

Planck, Henshall, Shapiro, Udell, Hammersley

14 December - Quantum Physics Day. "-- the anniversary of the day in 1901 that Max Planck created the concept -- and the word -- of "quanta" and launched the revolution that has taken over the world." We've all been waiting for Heisenberg ring tones: they tell you who is calling or when, but not both.

Stuart Henshall Resurfaces (Stowe Boyd)

How Skype might help bring Network Neutrality (Mitch Shapiro via Isen. Can you blame poor Skype call quality on your ISP or other pipe-owners? If so, grounds for a consumer fight for customer choice, competition, and for no-filtering rules. David Isenberg: "We can do our part by expressing our outrage when they're outrageous. Early. And often."

Jon Udell appeals for unification of voice and data channels. (InfoWorld) Amen, Jon.

HorsePigCow restates The Madenning Octet, 8 truths driving today's changing Internet:

1. Information wants to be free
2. Zero distance
3. Mass amateurisation
4. More is much more
5. True names
6. Viral behaviour
7. Everything is personal
8. Ubiquitouos computer

This is what is going to disrupt everything you hold dear in the years to come....work with it or perish...

The Enemy (you know who you are)

1. Copyright
2. Borders
3. Censorship
4. Network blocking
5. Identity cards and databases
6. More network blocking
7. Everything is trackable
8. No privacy

(I would add that anybody unwilling to change or open up or collaborate will perish as well)

From the brilliant Ben Hammersley

Syndication, Structured blogging, and the Adaptive Blogosphere

One of the two new ideas in syndication this year: SSE, making RSS bidirectional so you can post back to an RSS publisher. The other, structured blogging, lets you add forms to blog posts and to news readers. Structured blogging is something I wrote a lot about starting three years ago on my a klog apart blog and as proposals to the first Atom specifications for Semantic Component Blogging leading to an Adaptive Blogosphere where your newsreader learns new form types from feeds, and then trains your blogging tools to support those forms, so your blogging tools become smarter over time and the blogosphere shares more structured data. See also: about my liver's weblog.

Would you like to animate your Skype profile? Reallusion has launched CrazyTalk for Skype which enables messaging with facial expressions and character animation. Thus they say making your Skype conversation more amusing and creative. Your friends will have to get CrazyTalk for Skype too to play. It's a free download to get started.

CrazyTalk for Skype is a dynamic animated messaging tool featuring customizable emotive facial animation allowing you to create Skype characters from any photo! It is much more fun than conventional video chatting. Animate Skype with loads of content you can download from the web or create yourself with CrazyTalk Avatar Editor. Share them with your friends whenever you like, using whatever photo you like, animated however you like – to become the face of whoever or whatever you want to be! Reallusion

Overall, this is another smart piece of piggyback marketing on Skype. It creates new value for Skypers interested in having some fun while introducing the "Skype" community to the oppportunities and benefits in animation. To create your own photo animations you will have to trial or purchase CrazyTalk Messenger. More than a few Skypers should know how to use it and get others laughing. Reallusion is offering a "free" CrazyTalk Messenger so you can animate your own photo's in a promotion they are running. Share with your friends and win.

I know some of my readers will ask why would you do this? I really don't have the time. However I can see an animated character taking a voice mail, or providing some other form of info as just a beginning. For the most part the solutions will just be more fun than that. When Skype adds video (real soon) then even more opportunities for sending animated movies may appear.

Reallusion has effectively created an avatar-like program for Skype that goes beyond what's offered on MSN and Yahoo. I'm sure their technology could be worked into anyone of these messenger programs and perhaps that is what they hope to achieve. For the moment Skype's API wins again in leading the way.

Noticed in Tesco that the mobile phone rack has shrunk in half for the Xmas season, with digicams filling the space instead. Tesco, as one of the world’s most astute and profitable retailers, generally gets these things right. Which tells us that for all the hype, “convergence” isn’t automatically a given, and when it happens it can be slow. Also doesn’t bode well for mobile as as a hot Xmas item — can you spell “saturated”?

But what’s really interesting is this. There are no 3G phones. Zero. Tesco is unable to articulate a value story in 3G for the everyday UK mobile customer. There’s no benefit to 3G that the consumate marketers at Tesco are able to spin that justifies any premium price or shelf space!

Doesn’t the inability of Tesco to stock and market 3G call into question, just a teeny bit, the strategic nous of those leading the industry to the world of IMS (a.k.a “3G mk 2”)? Actually, it reminds me a bit of yesterday’s post. Note that the O2 tagline is “Internet at the touch of a button”, when it’s anything but! As is the telco way, they’re conflating a service (Web) with connectivity (Internet). If it really was Internet at the touch of a button (any why bother with the button?) we’d all have a superior voice and messaging experience on O2 devices courtesy of Skype, MSN, Yahoo et al. Now that would be something to crow about.

PS - Note to US readers. Tesco is broadly the equivalent of Target, although the focus is more on food in most stores, and the quality of the food is a bit higher than the often mediocre efforts in the US supermarket sector.

via Telepocalypse

Richard Zhao Liang and Bill Campbell.

Although the worldwide VoIP market is booming and Skype has wooed millions of users, its road to China is not so bright as in other parts of the world, especially for revenue.
There are four kinds of VoIP services: phone to phone, phone to PC, PC to phone, PC to PC. In China, the phone to phone and phone to PC are clearly defined in law as the basic telecom services that no one besides these six services providers can provide: China Mobile, China Telecom, China Netcom, China Unicom, China Railcom, and China Satellite Com.).

The Ministry of Information Industry (MII), according to the notification no. 413(2005) on July 18, will continue to ban commercial PC-phone VoIP services, except for a trial at four cities countrywide: two for China Telecom at South China (Shenzhen and ShangRao, Jiangxi Province), while two for China Netcom at North China (Changchun, Jilin Province and Tai’an, Shandong Province). During the service trial by Shenzhen Telecom (a subsidiary company of China Telecom), the price of VoIP phone is about 2.5 cents (US) for both domestic and international calls.

A joint venture with TOM Software will not help Skype generate revenue in China. Skype would require a joint-venture with China Telecom or China Netcom. But without clear commercial benefits to those two fixed line carriers such a joint venture is unlikely to occur.

Skype’s only source of revenue from mainland China will only be from SkypeIn and SkypeOut originating from outside of China. And none of that revenue will flow to Skype’s Partner TOM Software. So the marketing approaches shown below might be suitable for Skype into China:

First, continuously fight for an increasing market share at IM and PC to PC market, competing against QQ, MSN, YIM, Google Talk, Sina UC, and NetEase PP.
Second, cooperate with those smartphone/handset/pda hardware vendors for solutions like USB-plugable PC phones.

Skype’s competitive advantages come from its voice quality, encryption, and ease of use.

See original post here.

In all the talk about Google Talk many missed Microsoft's release of MSN 7.5.

If you use MSN it is time to upgrade. Leah, the program manager for MSN messenger introduces it here and writes a letter to Google Talk here. I think Leah knows how to use a blog!

Net net, the new MS MSN 7.5 is impressive at least under the hood. It is like an old car that has been hotrodded with a new motor and at the same time they've upgraded the suspension without fixing the seats or interior. However they did stick in the new boombox. The control interfaces remain so yesteryear. Still it now kicks ass in the Voice - audio quality - and Video - department. Here it is very impressive. So real improvements and radical upgrades are under the hood. Even Leah contrasts usability with Google Talk, where she writes "I will improve my usability. Maybe your straightforward interface will bring people into the IM markets who have been intimidated out of it by the more complex clients."

Effectively we now have a defacto audio standard emerging with GIPS codec driven clients (Skype, MSN, GoogleTalk, Gizmo etc.)perhaps tuned differently, while anything else remains inferior. Even so none of these conversation clients talk to each other yet.

Thus MS now has a platform in place to build on. The next generation will be very competitive. It will need to get off the PC to be really exciting. It's also limited to Windows XP at this time. Where is that multi-platform?

So why am I not that excited?

It is not just the lack of messenger buddies I have. I can see this version will keep hardcore MSN Messenger fans happy. So if your life revolves around MSN Messenger then it's a nice step forward. I'm going to brush over some of the contact enhancements and tie-ins with Spaces etc. They are worth looking at, also don't fix it for voice users.

Biggest complaint from a "voice" user.

I said the control mechanisms were screwy. I've made a big thing in the past about "computers are connecting" "accept this conversation" and that's where this client still feels very dated. The modes eg "in a call", even how you start a call and hang up a call are not obvious. At least version 7.5 rings. Then strange things like wanting to go from "voice" to "video" force you to drop the call and reconnect. I can't explain that.

Also on the voice side there are no conference calls and no capability to interconnect into the PSTN or even other SIP clients.

Some Pluses:

On the plus side there are all sorts of new goodies enabling new ways to express yourself. Most intriging to me is what MSN calls "voice clip". This is similar to push to talk and enable clips of up to 15 seconds. This is an innovative way of providing this feature. It remains in the chat client where you can also replay it. Note pressing it during a voice call only results in your comments being recorded. So we lack call recording.

Like Google Talk, MSN 7.5 is peer to peer just using a central directory to set up the original connection. Like Google neither of these are providing a safe encrypted service. That's a starting point for Skype and I think an important one.

I like how Leah is writing about her product. It's personalising the experience. It's a great bloggy example. I'd also be interested to hear her thoughts on Skype. Then I believe Microsoft is very busy with their "Skype strategy".

It’s crazy how two IM clients like us can be so similar yet so different. You are so dedicated to your primary functions, that you have a chance at really mastering them. I love the way you concatenate messages from the same person, and that I can choose the names for my buddies. Your call connection time is very fast, and your sound effects are pleasant too. I, on the other hand, spend my energy in many different directions at once. I value chat and voice, but I also get a kick out of video and personal customization. I love helping people to share files, and stay engaged with whiteboard, P4 apps, and games. I like the silliness and vibrancy that winks and emoticons and dynamic display pictures can bring to an otherwise static interaction. I have users with such a wide variety of interests and it’s important to me to keep all these things going so they can pick and choose. I admit, though, that concentrating on so much at once sometimes makes it tough to give each feature the spotlight it deserves.(In some cases, impossible – providing simplicity and extensive choice can be mutually exclusive). Leah - "I'm Just a Messenger"

Where does Skype fit in?

I think it remains materially ahead of both MSN Messenger 7.5, Google Talk and all the rest as defining the role of a "conversation client". The IM clients are learning how to imitate aspects. None have begun to integrate modes of voice operation with headsets and handsets. None of them have released API's. None yet have an announced embedded strategy. For the most part PSTN interconnects aren't there and they aren't cross-platform. Still the combination of what's invented in these communication clients is developing as the replacement for telephony.

While I mull over how a client can have so much potential and so many flaws I start to think about what I might do given MS resources. I think I'd start comtemplating a "range of communication clients" --- launching MSN in different formats with different skins to cater to different audiences. It appears stupid for both MSN and Yahoo to continue developing just one chat client. Why not broaden the range?

Is it all over for Skype? As Google Talk launched tonight with an Orkuttian viral shove provided by Gmail. At first glance it could be Skype's worst nightmare or the kick start necessary to refocus Skype. If you missed the buzz, Google Talk is the long awaited and predicted IM / Voice client. It won't be over for a while and the battle will take to the trenches with Yahoo, MSN and AOL battling to the end. This is a first salvo. Don't expect Google's feature set additions to follow Skype's path immediately to Telecom as Google has other opportunities sitting there within its empire. These are my first impressions.

• Extreme Simplicity. If you have a Gmail account you can just log in. The client is very simple.
  
• Find buddies quickly. If they are in Gmail then you can make hundreds of invites very quickly. Authorization is simple.
  
• Presence. Simplified and more intelligent than ever with customized field options that add new fun to presence. It's about time!
  
• Chat. Very basic, no emoticons etc. Still it's clean and archived and I bet searchable (if not now soon) by google desktop. Chat uses XMPP and thus iChat and Jabber clients can connect directly to Google Talk. You can also add it immediately to Trillian. (Trillian could be quite a winner). Guess that will put Google Talk presence on mobiles too!
  
• Talk. Talk is chat centric. Ie click to chat rather than Skype's click to call. Clicking opens a chat dialogue box. You then initiate a call from the chat window. Talk quality matches Skype and is better than Yahoo.
  
• Chat Window Organization. Windows self organize in an interesting fashion until closed.
  
• No profiles and no friendly pictures at this time.

How it really worked.

I had 8 conversations all around the world. Some of the voice connections didn't connect immediately and felt like they failed. There was just no sound. Sometimes the sound started after the call was connected for 30 seconds or more. This is likely just a short term bug. I enjoyed the inbound ring tone. Distinctively different from Skype. The invite process was very simple, building my list very elegant.

What's Missing?

From a Skype user's point of view: Almost everything. There are no profiles, no photos / pictures, no voice mail, no multi-conference or multi-chat. Plus there is no SkypeIn or SkypeOut capabilities. This is not a phone replacement. The multi-chat and conference calling should be easy to duplicate. The telephone system more difficut. However, each name is a SIP name and that is designed to connect with Vling and Gizmo project in a very short time. Plus with rumors around Google raising money, a TMobile USA purchase can't be that far away. That would provide a user base, the WiFi hotspots and most importantly the chance to integrate mobile numbers with VoIP.

Where's the Strength?

Talk is already integrated with Gmail and thus links nicely with IG, Google's personal content portal. So when will GoogleTalk have access to Orkut (profiles / social networking - pictures and profiles) Blogger (another place to share presence), Desktop (archive searching), Maps (location information) and instantly the whole Jabber/XMPP community. How quickly can Google bring these all together. Then they already have a photosharing program etc. Google has all the elements to bulk up to a Yahoo like client very quickly. Add in Ad Sense etc. Very neat models are likely to emerge. I heard from one punter tonight they had told their mother to buy more Google shares.

Developer Talk

Google has a great page outlining their preliminary plans and open strategy for the future of "talk."

Google's mission is to make the world's information universally accessible and useful. Google Talk, which enables users to instantly communicate with friends, family, and colleagues via voice calls and instant messaging, reflects our belief that communications should be accessible and useful as well. We're committed to open communications standards, and want to offer Google Talk users and users of other service providers alike the flexibility to choose which clients, service providers, and platforms they use for their communication needs.
Google

How does Skype stack up? Yahoo?

• Google may win on philosopjy alone (see above mission) or the resources in dolars and manpower. However today, while Google may get it's Orkuttian swell of new users isn't actually an acceptable replacement client for either Skype or Yahoo. Both do more better for their current audiences.
• On features, Skype is still ahead and if they would speed up their development and releases of call forwarding, VM improvements, Video, and their Presence Server they still have a chance althougth the market has shifted dramatically. Yahoo is bulking up however still does nothing really well. That may change.

Where should Skype's strategy start?

Open Up! By contrast with Google, Skype is on a philosophical back foot, well balanced. Being closed is no longer an asset, so Skype can compete only on its design, features and capabilities. To open up, the Skype chat client must adopt the Jabber/XMPP protocol, accelerating its interconnect and encouraging developers to "stick" / "start" developing products around the API. So far Google hasn't announced an API (count the hours). They will need one even if just for hardware. Skype will be forced to open up many aspects of its interface now.