AOL denies report of instant message systems links

NEW YORK: America Online Inc. came under fire on Tuesday for a report, denied by the company, that it had quietly tested a way to link its two popular instant messaging systems, which would undermine arguments it made to regulators probing its merger with Time Warner Inc.

The Wall Street Journal reported on Tuesday that America Online had for some months been holding compatibility tests to allow users of its Instant Messaging (AIM) software to sign on to its separate ICQ message network. America Online disputed the story. AOL spokesman Tricia Primrose said that AOL engineers eight months ago had conducted a short-lived test to see how AOL Instant Messaging software could be used to connect ICQ users.

"This was an eight-month-old test...was designed to study some of the technical issues involved in instant messaging. It doesn't allow for interoperability," Primrose said. "Rest assured that ICQ will not interoperate with AIM ahead of other instant messaging systems," she said, repeating America Online's commitment to eventually make its systems work with other instant communication services.

America Online's AIM and ICQ, along with similar programmes from more than a dozen rivals such as Yahoo! Corp. and Microsoft Corp.'s MSN, allow users to communicate by typing rapid-fire e-mails on pop-up computer screens. The software allow users to swap photos, make Web-based phone calls, read news and search the Web.

AOL claims 70 million registered users of its ICQ system and 61 million of AIM as of July. AOL's spokeswoman said there were 20 million active monthly users of each system.

Competitors complain that the No. 1 Internet services provider has a virtual stranglehold on the instant messaging market with its AIM and ICQ services.

Primrose said that at no time during its software test were the AOL Instant Messaging and ICQ networks linked. The event was never publicised and only those users who ignored standard practice and tried to sign on to ICQ with AIM software would even have become aware of the test, Primrose said.

Still, the Journal story was seized upon by rivals who have asked the government to pressure AOL to to open up its two instant messaging systems, which currently cut off users of other instantaneous communications systems from AOL members. The issue has become one of several stumbling blocks as AOL and Time Warner seek regulatory approval for their merger.

"The fact that AOL has established virtual interoperability between its 138 million AIM and ICQ members completely undermines AOL's argument to government officials stressing the technical infeasibility of open communications," Margaret Heffernan, co-founder of instant-message rival FreeIM. She is also chief executive of CMGI Inc. unit iCast.

"AOL's attempts to keep this information hidden is just one more example of its dominance of the market and its attempts to keep its walls around its users," Heffernan said in a statement responding to the Wall Street Journal report.

Shares of AOL ended little changed at $55.60, up 3 cents on the day in Tuesday trading. Time Warner gained 10 cents to $80.22, both on the New York Stock Exchange.

(C) Reuters Limited 2000.