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BOSTON -- Like much of the group that made it popular, instant messaging is a high-potential teenager going through an identity crisis, according to Microsoft Product Unit Manager David Gurle.

Speaking at the Instant Messaging Planet Spring 2003 Conference and Expo here Tuesday, Gurle said IM is often misunderstood. For its true potential to be realized, service providers will have to undergo a tremendous shift in their business models, he said.

"IM is not about connecting terminals to terminals--what we've really created is a people-to-people Web," Gurle said.

IM's feature of presence, being able to see when a user is online and available to communicate, is the key to the technology, Gurle said. He contends that element should be exploited.

"IM is a virtual network on top of the Internet and we haven't figured out how to leverage that yet," he said.

Market Shift Urged

Gurle's views, coming as myriad players are rushing into the IM market and Microsoft itself is readying an enterprise messaging product, "Greenwich," came as a bit of a surprise. Gurle argued for a perspective shift that would require most attendees of the conference--businesses, service providers, and Microsoft itself--to do some fancy footwork to get ahead.

Gurle called for a focus on presence that would let businesses easily communicate with business partners and customers, without worrying about security, interoperability, and authentication. He urged a shift in control over "namespace"--the naming convention for IM users--from the service providers to the user businesses.

"IM has an identity crisis," Gurle said, referring to the current status of namespace. Users typically invoke aliases for the connection, rather than their true names or identities within a corporation.

Gurle foresees a scenario where individuals and companies control their namespace and can authenticate these identities. But for this to happen, separate IM and presence networks must work together. A clearinghouse approach is the best way to ensure networks interoperate, trading access like phone networks do now, Gurle said.

However, Microsoft's Greenwich, which is scheduled for release in the second or third quarter, offers a federated approach. It allows business partners and customers access to a company's IM network.

"But we know this won't scale," Gurle conceded, saying that it would be an "ID nightmare" to give access to numerous partners and customers.

Many Opportunities

Gurle's admission that Microsoft's own product will not be scalable came as a sort of plea for the industry to start working toward a better model.

"If we don't get a clearinghouse infrastructure, we are never going to get past presence and IM," he said.

Gurle's comments came as many users and industry providers alike have begun dreaming of all the potential uses of IM. They cite video conferencing and tight integration between applications and people, for example.

But Gurle believes the technology has even more potential, and could turn the communications market on its head.

Demands by corporate technology buyers will shape the industry, Gurle said. He urges service providers to reconfigure their business models to keep up with this changing market.

While Gurle seemed to envision a network of people, it is unclear whether that is Microsoft's direction. Greenwich features include multiparty chat capabilities, peer-to-peer voice and video conferencing, data collaboration, authentication, encryption, multidomain support, and e-mail. And while these capabilities are designed to solve some of the market issues Microsoft identifies, the company is clearly on the IM move.

Nor is Microsoft alone; players like Yahoo and America Online are also gunning for the corporate market. Clearly, Microsoft plans to push aggressively into this burgeoning service.

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