Chat Wars: Microsoft vs. AOL (2014) | Hacker News Reader

Chat Wars: Microsoft vs. AOL (2014)

nplusonemag.com

126 pointsingve30 comments

This is a great article. Ok, I skipped the parts where he explain how computer works and the history of MS, but I loved how he goes from the internal working of Messenger to the higher level problems in MS.

On the other side, does anyone have a good, encompassing explanation to why AOL was a such a systematic value destroyer? I always read about MS structural problems, but not AOL's.

Nullsoft (Winamp), Mirabilis (ICQ) and Netscape (Navigator) quickly come to mind, but I guess there's more, including their own ecosystem with keywords and promotional websites.

Fact is, after an AOL acquisition, everything stopped evolving. Maybe not Netscape, but it lagged behind, still. Anyone?

All of these things acquisitions happened before the lackluster Randy Falco or the clearly malicious Tim Armstrong so we can count them out for the failure.

As an outsider, I'd say the main problem is the lack of a clear identity. What is Aol? Is it an ISP that never upgraded beyond dial-up? Is it a communications company a la AIM and Aol email? Is it a news/media conglomerate a la Huffington Post and Patch?

But I could be wrong.

I had read an article on the fall of winamp once, I think it was this one by ars technica: http://arstechnica.com/business/2012/06/winamp-how-greatest-...

It seems like in the case of winamp there was a mix of bad management decisions and what is now history (the rise of the iPod, web 2.0, and the fall of AOL's primary service).

Certainly, nothing became of TimeWarner.

Does this not also happen with most acquisitions in general? Look at all the companies Google has bought; how many of them have the actually done something with which has turned into a profitable arm of the business?

Google buys a lot of companies for their bodies, not their products.

Steve Case. He was out of his league with the meteoric rise of AOL and was simply at the helm of a ship being carried on the jet stream. Netscape brought on Jim Barksdale because Marc A wasn't fit to lead NS. Google brought on Schmidt for the same reason. AOL never brought anyone else in because Steve was a fully grown adult, so no one was willing to recognize his inexperience at running a company that size. I'm not saying he was dumb or bad or anything such as that, simply that he was out of his league when AOL managed to grow so large. Plus, right after the NS and TW acquisitions, the dot-com bubble burst, and smaller properties like winamp and ICQ were ignored while the company focused on righting itself after a $100bn write down.

I had some of my best years working on the operations side of Messenger. I learned a lot from David, Jonathan, Yikang (and a few others whose names I can't remember). We did some very cool things that were ahead of our time. Sorry to hear about the morale issues. MSN was never given a fair shake by MS.

Thanks for the trip down memory lane David. -Your buddy sending you all those CS and SB stack traces.

Further back, there was Compuserv email, MCI email, UUCP email, and, for a privileged few, Internet email. None of those interoperated, annoying users. The proprietary ones all died or learned to interoperate.

Now we have Instagram messaging, Snapchat messaging, Twitter direct messages, etc. The vendors want lock-in, but it's a pain for users. Will we ever get messaging convergence?

We could have done it with XMPP between Facebook and Google, but that never happened due to some reasons: http://www.disruptivetelephony.com/2015/02/google-finally-ki...

http://aaron-kelley.net/blog/2010/02/a-request-for-federatio...

AIM also had XMPP support for a bit: https://web.archive.org/web/20110522092331/http://www.aim.co...

As did MSN Messenger: http://en.m.wikipedia.org/wiki/XMPP (in "History" section; sorry, can't dig up link from archive.org ATM )

I once worked at AOL (2010-2012). I remember that we were told that we couldn't use AIM for work purposes, and instead were using Yammer and HipChat.

It boggles the mind how a company with a chat product ends up using 2 competing products instead of its own offering.

I worked there in 2014 as an intern. We definitely used aim but another department used Skype.

Wonderful article, even if the mid section gets a little too detailed about the history of MS and the understanding of programming abstraction layers.

Looking back on the past and being able to relay your day-to-day life like that into a story is very cool.

How much effort and time could be saved if instead of "chat wars" they'd worked on shared standard for instant messaging? The irony is that even today they don't. Some just never learn.

Even Google's moving away from XMPP (last I heard) with hangouts. I was surprised when I found out the best thing I'd get in terms of being able to talk to hangouts would be revengineering the protocol, a la hangups (https://github.com/tdryer/hangups)

Google turned sour with Eric Schmidt leading all this "social" effort there. So interoperability was thrown out with excuse that "others don't care". Of course opening up Hangouts and making it a IETF standard as an obvious alternative wasn't done either, which only highlights the hypocrisy of that excuse.

Thats a pretty basic game theory problem. I don't know why people in tech continue to expect companies who view ownership of the platform to suddenly standardize and open it up for everyone to use.

Open ecosystems like Android continue to be profitless while closed ones like iOS rake in billions.

Because their petty greed translates into endless years of incompatible mess. We are lucky e-mail works today. If such stupidity as what's happening with IM persisted with e-mail too, we'd be still mostly using snail mail. Thinking of it, we are lucky Internet itself wasn't designed by one of those backwards thinking "platform owners".

Communication protocols should not be an "owned platform", they should be communication tools.

The engineer here seems to see this competition as a bit of fun, but a product minded person would be in horror of how much time was wasted on a goal that added little or no value to the messenger product. competitors like Skype were building out new features like video conferencing or audio calling while these two were goofing off fighting over a relative small part of the communications pie. This rat holing left msn irrelevant by the time gtalk and Skype arrived on the scene.

This little battle took place three years before Skype existed, and being able to send messages to people using what was then the dominant messenging client added more value than just about anything else Microsoft could have spent those developer hours on; as integral to its growth as ensuring that Whatsapp worked with iOS updates.

Yesterday someone challenged my post on Snapchat by suggesting that services with >100M users never failed to make significant revenue, and I just remembered how insanely popular these earlier clients were...

MSN Messenger made idiotic amounts of money with custom emoji packs. I don't know if it was significant - like, was MSNIM ever cash flow positive? Doubt it.

Those early clients barely had 30 million users and their daily actives were probably on the order of 20% of that. Whatsapp and Facebook messenger are approaching 1 billion users with daily actives at 70 to 80%. And far before that Skype trounced msn messenger.

What I was trying to say is, they spent their time trying to get a piece of a pie that was ultimately irrelevant. It served little if any business purpose and trying to usurp AOL users to get a vanity metric was a form of self delusion. You need loyal, deeply rooted users who care about your product and your network. Trying to piggy back off someone else is applauded by short term people but you end up with a toxic and indifferent user base.

They might have been barely 30M users in the late 90s but at a time when that constituted most people using the internet for chat, I'm genuinely baffled that you think it was a "vanity metric" rather than a significant product enhancement to be able to communicate with them. In fact, I'm struggling to think of anything more likely to bootstrap a base of loyal users than the ability to talk to basically everyone else using chat applications on the internet. Any suggestions?

(FWIW I'm not convinced they could have developed a VOIP service that functioned well over 28.8kbps dialup modems in the few hours they spent reverse engineering the latest changes to AOL's chat protocol. But yeah, if their engineers were that good, it would have been a nice market to win)

Since MSN (or Windows Live) claimed 330m monthlies by the late-noughties - far ahead of Skype's superior product - I'd also hazard that they had significant success with getting loyal, deeply rooted users, even if they had the help of it coming installed with Windows. That's far more users than Snapchat, and probably more than the number of actual humans using Twitter, so I don't think the unicorn comparisons are invalid.

Obviously the management structure was a little different from todays' chat startups, and "sell to Facebook for $20Bn" wasn't a monetisation option, but it was certainly an early outlying success in growing an mostly-ephemeral communication network and an early notable failure at turning that user base into profit.

Because if you were in the space you'd know that 330m monthlies is a worthless metric. This isn't a website, if those people are popping in once a month, they aren't really using it. MSN Messenger was never a success, and never really fit any strategic need or user need. They offered nothing to the market, and died when more useful products took their place with lower numbers but a more active, and valuable user base. (Skype).

For all their work, I believe MSN messenger robbed themselves of the opportunity to discover their own value by trying to bootstrap someone elses success. Try to at least hear me out on this, because if think this is a good strategy to apply to a startup you are kidding yourself -- as a startup MSN messenger would have failed, and as an internal product it was also a significant failure (but one that took too long to be realized as such)

The 330m user stat might not have been that impressive; Facebook was well on course to surpass it by then, but even as late as 2010 MSN/Live Messenger was apparently sending 9Bn daily messages from 1.5bn daily conversations. Which - I must admit I was surprised by this - is a lot more than Twitter boasts today. If those stats are evidence of failure to offer anything to the market I can only assume you don't regard the next generation of consumer startups that highly either.

I'm not sure what additional value pioneering MSN users would have discovered from not being able to communicate with people using AIM, but I guess we'll have to agree to disagree on that. At the time I found it a perfectly adequate chat client which my friends and I used exclusively, but I reiterate that I am open to suggestions of better ways for MS to have kickstarted the process of acquiring 230 million users in two years straddling the turn of the century.

They robbed themselves of the chance of success because they didn't really have many ideas of what to do with all those users beyond try to drive them to their web portal or sell them emoticons, but for the time they managed seriously impressive growth and totally dominated the market.

MSN Messenger had voice calling 2 years before Skype existed.

I'm not sure where you're going here other than to blindly hate. MSN Messenger's DAU and simultaneous login count was pretty impressive for the size of the Internet back then.

I remember reading this when it was first published, really nice article!

This reminds me that MS was developing OS/2 2.0 and NT OS/2 back when the Morris worm spread in late 1988. Yes, I am talking about the decision to use a flat address space on x86.

An interesting read. Especially the parts where he figures out the 'gobbledygook' :)

Thank you. Articles like this make coming to HN on a Sunday morning worth it.

Reply on news.ycombinator.com