Sneak peak at next MSN IM gets mixed analyst reaction

Pictures that Microsoft posted on Monday of MSN Messenger, version 6, show new voice and video features that will bring the company's consumer instant messaging (IM) application up to speed with both its fiercest competition and its own separately marketed IM clients.

Microsoft has waged a determined battle to wrest consumer instant messenger market share from AOL Time Warner amid similar challenges to AOL from Yahoo and countless IM start-ups. The company has sought to create buzz around the new version with an announcement in March, today's sneak peak and promises of more details to come between now and the midyear launch.

Microsoft said its current versions of MSN Messenger have more than 100 million unique users per month, a high point for the company.

Despite apparent progress in attracting new users to its free product, Microsoft remains behind in terms of feature innovation - though the new multimedia capabilities may at least beat AOL, which has also lagged on voice and video.

In addition to "significant improvements" to the user interface and new ways to personalise it, MSN also promised multiplayer gaming and videoconferencing capabilities.

Those features, along with others that Microsoft promised for its mid-year release of the consumer-focused MSN Messenger, are already found in a number of IM products, including some offered by Microsoft for other markets.

"Some of it just seems like catch-up," said Ross Rubin, an analyst with eMarketer, citing videoconferencing as an example. "We're not seeing a lot of innovation."

A Microsoft representative countered that Monday's viewing was only the first glimpse of the product and that future showings would answer critics.

Microsoft is updating MSN Messenger for consumers amid an equally concerted push for the business market. Windows Messenger, which Microsoft has marketed as a core piece of its XP operating system, is built for corporate users, with features for application and whiteboard sharing.

The company also markets enterprise IM software called Messenger Connect, which lets users of MSN Messenger or Windows Messenger log, authenticate and otherwise manage IM communications, as some financial institutions must by law.

And the company last month pledged that it would launch in the first half of the next quarter its Real Time Communications Server 2003, software formerly code-named 'Greenwich', which lets corporations serve their own instant messages.

Rubin questioned the wisdom of Microsoft's current strategy of splitting its IM products between consumer and corporate applications.

"I just think it's confusing, because they have a number of IM clients, some focused on the consumer and others on enterprise," said Rubin. "I can see how the demands are different for different users but I think it can be addressed with one product."

Lisa Gurry, Microsoft's group product manager for MSN, said that in serving multiple audiences, Microsoft was marketing multiple products and that the strategy made the most sense "right now".

Paul Festa writes for CNET News.com.