Yahoo ditches business messenger service

Yahoo has decided to ditch its fee-based instant messaging service for business users.

Yahoo has decided to ditch its fee-based instant messaging service for business users.

Yahoo will instead focus on its free instant messaging service, which is aimed at consumers, and rely on partners to make it palatable for business users.

These partners include suppliers which specialise in so-called gateway software which lets IT departments manage their companies' instant messaging platforms.

"We have reorganised our instant messaging business to optimise our ability to leverage the Yahoo network, whether our customers are at work or at home. By offering an instant messaging product that is based on a single platform, we are even better prepared to address market needs by offering features based on segmented needs," a spokeswoman for the company said.

Yahoo Business Messenger was a hosted service accessed via instant messaging software from Yahoo loaded on users' PCs. It offered features that many companies want and need for instant messaging, including message encryption, IT management and administration tools, message logging and archiving, voice and video communications and online meetings.

"We are committed to our customers and we will work with them to provide the best solution to meet their business instant messaging needs," said the spokeswoman. 

"Through relationships with companies, such as Akonix Systems, we are working with our customers to provide IT administrator functionality for the use of Yahoo Messenger in the business environment. This is an ongoing process, and there is no specific 'shut-off' date [for the Business Messenger service]."

Companies see little value in paying Yahoo for its managed service when they can get a broader functionality from suppliers of instant-messaging gateway products, said Genelle Hung, an analyst at The Radicati Group.

"The business model for the product wasn't very feasible," she added.

Gateway makers include Akonix, FaceTime Communications and IMlogic. These suppliers software is installed at a corporate server and allows IT departments to manage the use of instant messaging services, such as the ones from Yahoo, America Online and Microsoft, within their companies.

Juan Carlos Perez writes for IDG News Service

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