Yahoo! to upgrade IM video feature

By Jim Hu

Yahoo! is set to launch a new version of its instant messaging software that will offer a boosted webcam feature for broadband users - the web portal's latest effort to distinguish itself from rivals America Online and Microsoft.

The new Yahoo! Messenger 5.5 will allow much higher transmission quality for webcam users with broadband connections. The new feature will allow people to transmit video at 20 frames per second, just shy of the movie industry standard of 24 frames per second.

That's an improvement from Yahoo's current webcam rate of just one frame per second, which is geared toward people with dial-up connections.

Another added feature is a new collection of "emoticons," some of which are animated. The software will also include more IMVironments, which allow people to download custom backgrounds from advertisers and other Yahoo! properties.

"We do believe that our innovation and ability to continue to advance instant messaging services is definitely a driver of our growth," said Lisa Pollock, director of messaging products at Yahoo! She added that offering more multimedia features is giving the company a "leg up" against its two primary competitors, AOL and MSN.

The upgrade signals yet another attempt by Yahoo! to differentiate itself from rivals. Yahoo! Messenger has a considerably smaller audience than market leaders AOL Instant Messenger and MSN Messenger. In the United States, Yahoo has a 16.7 percent share of work and home subscribers, compared with AOL's 28.3 percent and MSN's 24.1 percent, according to Jupiter Media Metrix.

Yahoo isn't the only instant messaging provider to add webcam functions to its service. Microsoft's Windows XP operating system was launched last year with an instant messaging service called Windows Messenger, which includes video conferencing features and is interoperable with its free MSN Messenger software.

Jim Hu writes for CNET News.com