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Google, Microsoft At It Again--This Time It's VoIP

In what's become a chess match between Google Inc. and Microsoft for the attentions of Internet-savvy consumers, Microsoft made another move last week. It acquired voice-over-IP startup Teleo Inc., with plans to expand on the Internet phone-call capabilities it offers through its instant-messaging software, MSN Messenger.

The acquisition comes one week after Google released Google Talk, a downloadable Windows application for instant messaging and PC-to-PC voice calls. That same day, Microsoft disclosed an upgrade to MSN Messenger, version 7.5, that it says offers better voice-chat quality and some new features, including the ability to send a 15-second audio clip.

Users of Microsoft's MSN Messenger already can click on telephone numbers stored in Microsoft Outlook and Internet Explorer to make calls from PCs equipped with headsets or speakers and microphones. Teleo's technology offers more options for conducting voice communications, including the ability to place calls from PCs to traditional landline phones and cell phones, Microsoft says. Google Talk doesn't offer those options. "If you're a product manager at Google, AOL, or Yahoo, you have to be worried," said Jeff Pulver, a VoIP expert and creator of the Voice Over Net conferences. "If it chooses to, Microsoft could dominate" consumer VoIP.

Eric Schmidt

Eric Schmidt
Bill Gates

Bill Gates
Google Talk
The company's first IM offering includes phone-call capabilities

Google Desktop 2.0

Desktop-search upgrade includes new personalization features

Google Earth
3-D maps let users zoom in and out images of streets and buildings

New Exec
Temporary court order bars Kai-Fu Lee from working on competitive technologies

MSN Messenger

Recent acquisition expected to expand beyond PC-to-PC phone calls to include landline phones

Search Offering
Upcoming search engine will let the the same tool search PCs and the Web

Virtual Earth
Based on satellite

Microsoft sues Kai-Fu Lee, claiming he violated a noncompete agreement

The battle over consumer VoIP is just the latest in a dizzying string of competitive product rollouts between the two companies. Also last week, Google released Google Desktop 2, which updates its desktop-search software with personalization features.

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