MSN closing foreign Web chat services
By Helen Jung
Associated Press
SEATTLE — Microsoft Corp. is shutting down Internet chat services in most of its markets around the world and limiting the service in the United States to help reduce criminal solicitations of children through online discussions.
The changes also should help Microsoft shed some nonpaying users that have dragged on profits, said an analyst who follows the software giant.
The changes, which will take effect Oct. 14, were disclosed yesterday.
In most of its 34 markets in Europe, Latin America and Asia, Microsoft MSN has chosen to simply shut down the service. However, MSN will continue to offer chat services to users in the United States, Canada, Japan and Brazil.
Eliminating and curtailing the service will help curb inappropriate uses, MSN spokeswoman Lisa Gurry said, including pornographic spam as well as pedophiles or other sexual predators.
"We recognize that it's a common industrywide problem," she said. "We've taken a look at our service and how can we make efforts to step up our efforts to provide a safe environment."
Microsoft officials refused to say how many people use its chat service.
The Redmond, Wash.-based company has about 8.6 million subscribers for its Internet service. Gurry said the number of MSN chat users has been declining as people switch to instant messaging services from companies such as AOL, Yahoo! and MSN.
In recent years, authorities have pursued cases in which suspects allegedly sought out children and others through online chat rooms, including an incident in July in which a 12-year-old British girl ran off to meet a former U.S. Marine she had met in a chat room.
In the United States, MSN will require users of its chat service to subscribe to at least one other paid MSN service. That way, the company will have credit card numbers to make it easier to track down users who violate MSN's terms of use. The sessions will not be moderated, Microsoft said.
In Canada and Japan, the company will offer some moderated chat rooms. Users can also subscribe to an unmoderated service. MSN will offer some moderated chat discussions in New Zealand and Brazil.
The move also may help MSN trim the number of free users and help boost its overall revenue, said Rob Helm, an analyst with Directions on Microsoft, an independent research firm.
"I think this change will have welcome side effects, like keeping spammers out of the chat rooms," he said. "But fundamentally I believe this is a move to make MSN more profitable. It will allow the company to get rid of some infrastructure that was supporting chat, and to make more money on what it leaves in place."
Microsoft yesterday closed at $29.60 per share on the Nasdaq, up 53 cents from $29.07 on Monday.
Bloomberg News Service contributed the closing price on Microsoft stock.
