MSN in with Live Messenger, Waiting for Google GTalk

Microsoft dove into the IM VOIP business with the launch of its Windows Live Messenger, making the voip marketplace a little crowded and a lot more interesting. With Live Messenger you can make pc to phone calls and video calls which makes it a direct competitor to Skype.

But features wise Live Messenger is not exactly up to the mark with Skype, at least not yet.

First, for PC to Phone calls you will need to sign up with Verizon. So there are two sign ups for anybody starting with Live Messenger. You need to sign up with msn (if you don't have an account with them) and then you need to sign up with Verizon for pc to phone calls.

Second, unlike Skype, MSN Live Messenger doesn't give you a phone number for others to call you. So when Skype offers both a SkypeOut and SkypeIn service, MSN just offers Live-Messenger-Out so to speak.

Then Skype offers free calls to anywhere in the US till the end of 2006, which is helping it add to its user base. MSN offers nothing to entice those users back from Skype.

MSN plans to let its users talk to Yahoo users and this may help MSN & Yahoo a great deal. MSN + Yahoo will make a huge user base, at least for pc to pc calls. Skype has no plans to open up its messenger to other IM users.

But the money is in converting those pc to pc calls to pc to phone calls. And it remains to be seen which company does it the best.

As I mentioned in my previous post, with all the big players jumping into the IM Voip market, it may prove to be a boon for the consumers, if prices go down and quality improves. Stay tuned for the possibility of market consolidation. There are other players in IM Voip market like NetZero,Earthlink. The big companies, MSN, Yahoo and Goolge, may go shopping for smaller voip companies to give themselves some initial customer base to work with.

Now if you will excuse me, I got to go make a pc to phone call :-)

Vonage Downgraded by Research Analyst for ... What

Pali research analyst Richard Greenfield downgraded Vonage stock from `neutral' to 'sell' after he discovered Vonage is offering existing customers a discount rate of $19.99 a month to stop them from switching carriers. Vonage charges new customers $24.99 a month.

Is that really such a bad thing in a market economy where competetion thrives and companies go to great lengths to retain customers. Is that really a sign that the comapny is doing badly.

How many times have you called Sprint or American Express to cancel a service to be given a free offer like a free newer cell phone or a free year of service. Retaining an existing customer is much cheaper for any company than getting a new customer.

Vonage lowering the monthly rate for customers who want to switch, in my opinion - just this one single marketing strategy - is not such a bad reflection on the company. And eventually Vonage may gain from this IF they act on the reasons why customers want to switch. May be its the call quality or may be its their customer service.

But anyway I wouldn't sell my American Express stock just because they offered me a free one year on my Skymiles card, neither would I sell Vonage because they offered to lower my monthly rate. I would rather take the offers. BTW I don't own any of the above two stocks.