Can IM Reshape the Future of AOL?

In order to rebuild its brand image while establishing new revenue streams, AOL has turned to its most valuable asset: AIM.

With Google's entry into the instant messaging space this week, rivals AOL and Microsoft are wasting no time planning their future moves. MSN Messenger 7.5 shipped with minor improvements on the road to version 8, while AOL is already mapping out its second generation Triton client for next spring.

Triton, the code-name for the next iteration of AIM that will replace version 5.9, entered beta testing in April. Like its competitors, the Triton client goes beyond IM to offer a suite of communications tools from voice to video.

But Triton's importance at AOL does not just lie in its messaging capabilities. Amid pressure from parent Time Warner to establish profitability in the face of declining dial-up subscribers, AOL is increasingly turning its attention to the open Web where more eyeballs mean larger advertising revenues.

With 43 million monthly active AIM users, the service has become the central focus of AOL's new ad-supported strategy. Triton will be woven into the majority of AOL's Web properties upon its official launch this winter.

The idea, says AOL, is to retain the community aspects that formed the foundation of America Online - not an easy task when its users are no longer corralled within the closed AOL network. AIM functions such as initiating chat sessions will be exposed directly on AOL.com and AOL Search.

"AOL are the masters of integrating community features and interactivity into traditionally static content, but they need to get that in front of people and they need to get people to value that," says Jupiter Research senior analyst David Card.

AOL admits that it has historically been known as the ISP with training wheels and is attempting to utilize AIM to help change that image. While AOL is often gawked at by experienced Web users, AIM remains the most popular messaging network.

To that end, Triton bundles a revamped AIM Today window that is designed to introduce users to AOL's breadth of content, and targets younger generations with witty headlines. AIM has also been reconceived as a full-fledged brand with AIM Mail, AIM Blogs and more.

In addition, the company plans to make AIM the "front door" to many of its other services, from AOL Mail to streaming Web radio - even its Internet phone service. Beneath the surface, Triton will play a critical role in those efforts.