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October 18, 2006

Windows Live Messenger goes Orange

Posted by David Hunter at 10:20 PM ET.

France Telecom’s Orange is a significant mobile and Internet service provider in France and the rest of Europe and today they announced an alliance with Microsoft:

Microsoft and Orange will link their instant messaging systems later this year, allowing up to 375 million people to chat with each other using their PC or mobile phone, the companies said Wednesday. In reality, take-up will be much more limited.

Orange will offer its French mobile phone and Internet access customers a new service in December called Orange Messenger by Windows Live. It will extend the service to the U.K. and Spain next year, making it accessible to 135 million Orange customers in total, the company said Wednesday. Microsoft puts the number of Windows Live Messenger customers at 240 million.

Behind those numbers, though, the immediate potential of the link-up is more modest. Just 700,000 of Orange’s customers will have handsets compatible with the service when it launches in December, said Didier Lombard, chief executive officer of Orange’s parent company, France Télécom. It will be several years before all customers have replaced their handsets with compatible models.

Worse, before Orange’s Internet access customers can contact Windows Live Messenger subscribers from their PCs, they will have to download a new version of Orange Messenger, incompatible with the existing one. Once a user has moved to the new Orange Messenger, they will be unable to contact friends still using the old system. Orange is still considering what migration options to offer users, a company spokeswoman said.

There may slow uptake, but hopes are high and there’s another interesting twist:

“This is not about a licensing arrangement. We are coming together as two equal partners in sharing costs and revenues,” Ballmer told reporters.

He also mentioned that the agreement was not exclusive.

Filed under Alliances, Coopetition, Executives, Financial, General Business, Microsoft, Orange, Steve Ballmer, Windows Live, Windows Live Messenger, Windows Live for Windows Mobile

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