19 July 2004 Microsoft’s business customers will soon be able to use the company’s instant messaging service to link to America Online and Yahoo networks, it was announced this week.

The collaboration breaks a long-standing stalemate between the three companies over the future of instant messaging (IM), an email-like service that enables users to exchange short text messages instantaneously.

Microsoft’s IM product, called the Live Communications Server (LCM), will be sold to corporate users only and is scheduled for release by the end of 2004. The link to the Yahoo and AOL networks will extend the reach of the Microsoft services to millions more users. Previously, IM messages could only be sent to customers on the same network.

Microsoft will continue to offer its MSN Messenger program as a free download to public users. The LCM and MSN divisions will remain separate, enabling Microsoft to continue to compete in the consumer sector against AOL and Yahoo.

Both America Online (AOL) and Yahoo will receive royalty fees from Microsoft for connecting to LCS. Microsoft has not disclosed the terms of the licensing deal.