Free rides are nice, if you can get one, but you don't hitchhike your way to Microsoftian and AOLian status. The open instant messaging debate is no more about Microsoft trying to free ride on AOL's servers than the open access debate was about America Online trying to free ride inside Excite@Home's pipes. The "No Free Ride" argument fails because it is irrelevant in the board room, where decisions are based on how a position looks not on a bumper sticker but on a spreadsheet.
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IMUnified plans an August release of specifications for "functional interoperability" between its members' services. Other founding members include, Excite@Home (Nasdaq: ATHM), Prodigy (Nasdaq: PRGY), Phone.com (Nasdaq: PHCM), iCAST and Tribal Voice -- the latter two owned by CMGI (Nasdaq: CMGI).
Although it goes unmentioned by name or reference in yesterday's announcement, the clear-cut object of the group's disaffection is America Online (NYSE: AOL). IMUnified members have previously accused AOL of hiding behind privacy and security issues to slow development of an open IM standard. AOL currently dominates an estimated 90% of the instant messaging market, effectively making it a standard unto itself with few pressing incentives to either collaborate on an open standard or open its services to others.
Clearly, summer has arrived.
The growing controversy over open instant messaging has overlapped with, and is often compared to, open access to cable systems. The key players are the same. Both issues are about a closed, closely controlled technology to which others quite reasonably seek access.
The discussion is easily politicized. Although the issues are in fact quite different, they lend themselves to similar language and rhetoric. And as the open instant messaging debate heats up, we hear definite echoes from the open-access debate, which has itself cooled down. But how valid are these echoed arguments?
No Free Ride
"No Free Ride" was the preferred rallying cry of those arguing against open access. No Free Ride resonates rhetorically. In this drama, AT&T and Excite@Home were cast as the pipes of AOL's dreams. The idea that AOL expected to get no-cost, automatic access to those pipes, however, should have been rejected out of hand.
What was presented as AOL's demand for the ludicrous was an attempt to shape Excite@Home's business model to AOL's view of how the industry should be structured, one which was incompatible with a Excite@Home's exclusive cable affiliations. Rather than a free ride or "forced access," AOL sought Excite@Home's premature acceptance of an open industry structure that all parties, Excite@Home included, routinely acknowledged was inevitable -- what AOL called "consumer choice," and what Excite@Home called the "post-exclusivity environment."
Similarly, Microsoft and its IMUnified partners aren't looking for a free ride on AOL's instant messaging system, but to push AOL into prematurely accepting the clear inevitability of an industry-wide instant messaging standard, which is at the moment incompatible with AOL's "exclusive affiliation" with its varied-uses base -- and which IMUnified sees as "seamless communication," but which AOL sees as a "security and privacy" issue.
Framing these issues with the rhetoric of free rides obscures what they are really about, which is nothing less than the long-term shape of the online medium. The open IM debate is no more about Microsoft trying to free ride on AOL's servers than the open access debate was about America Online trying to free ride inside AT&T-Excite@Home's pipes. Free rides are nice, perhaps; but great companies neither expect nor count on charity, and you don't thumb your way to Microsoftian and AOLian status.
In the end, the No Free Ride argument reduces real issues to straw and is irrelevant in the board rooms where decisions are based not on how a position looks on a bumper sticker, but on how it looks on a spreadsheet.
Works like a charm
While the "No Free Ride" argument will have no effect on a company's policy, it can pose a particular risk to individual investors who come under its influence.
With the debate over open cable access now all but played out, we can see that the more forcefully and frequently the "No Free Ride" position was argued, the more self-evident it appeared and the more confidence in the outcome it inspired. But the issue simultaneously became less understood by those who made and were persuaded by the argument, who were unprepared when it failed to produce its promised results.
Rhetorically and politically, of course, the "No Free Ride" argument worked like a charm -- because a charm is all it was. But its premise was wrong from the first. The only thing arguing that position accomplished was to push the open access issue, and the many related issues it touched, further out of reach.
One of those related issues is open instant messaging standards. And it's interesting to see the "anti" side in this newer debate using the same argument as the "anti" side in the open access debate. The issues themselves are more different than similar. But with the open IM debate lending itself to the same language, the rhetorical ring of "No Free Ride" may again serve as noise to a more considered analysis.
Open IM, like open access, is first and foremost a business and economic issue. In the end, to argue business rhetorically is to shoot blanks. The "Great Instant Messaging Debate" is still just getting under way. But as two years of cable's open access debate have demonstrated, the blanker the bullet, the bigger the bang.
Your Turn:
Will the new IMUnified be able to pressure AOL into opening its instant messaging service to competitors? Should the government make that a condition for approving the Time Warner merger? The AOL discussion board is the place to be heard on these issues.
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