Squatters' Rights or Microsoft's Right?

I’ve been doing some additional thinking about Microsoft’s repositioning of MSN Chat and why the move makes pretty good business sense.

Apparently, Microsoft has seen the number of people using its chat rooms diminish over the last couple of years. Sometimes, abandoned buildings attract seedy elements. This decline in usage coupled with the increased of presence of bad elements and porn spam contributed greatly to the company’s decision to pull MSN Web chat in most countries and take it inside the MSN online service here in the United States.

The other reason, as previously stated, was plain and simple good business. The company also rightly reasoned that customers were turning to instant messaging rather than chat rooms. That is a technology of ongoing Microsoft investment. It’s also a technology through which Microsoft hopes to drive additional MSN review, such as online gaming and other extras. IM also is potentially much safer for kids, since they typically choose whom to chat with and can easily block unfriendly or rude IMers. So, from a practical business decision, putting emphasis on MSN Messenger makes more sense than MSN Chat.

That said, in a conversation this afternoon Microsoft made clear that if not for the amount of seedy, squatters taking up residence in MSN chat rooms, the company might not have chosen to pull them down. Or in the U.S. market, charge rent, so to speak, for chat rooms in the safer MSN online service neighborhood.

The larger issue facing Microsoft, and other companies offering chat services, will be balancing privacy against the need to know who potential offenders are. By placing MSN Chat behind the online service, the company has basically put an end to easy, anonymous chat on its network. And Microsoft can chuck offensive people from the chat rooms forever by terminating their MSN service contract. I commend Microsoft for taking a stand--after all, shouldn’t the company have a right to say what takes place on its network--but caution MSN to be careful deciding who is a chat room offender.

I expect to see many additional changes to MSN over the coming months, as Microsoft continues to close down freebees and make them part of the paid MSN online service.

Posted by Joe Wilcox at September 25, 2003 05:38 PM