• Illustration: Virtual Earth Interface

New MSN APIs will let developers incorporate MSN Internet Search results and Virtual Earth maps in their Web sites and applications and integrate simple applications into the MSN Messenger interface. The new offerings are free and are not intended to earn revenue from developers but rather to help MSN services reach a larger audience of end users and advertisers. The offerings also begin to address a long-term threat that Web-based companies such as Google will encourage developers to build consumer applications on top of their services rather than on Microsoft's software platforms.

MSN and the Platform Strategy

In the past, MSN has licensed some services to developers, including Alerts (for sending one-way text messages to MSN Messenger users), ClearLead (for managing sales leads), and Passport (for authenticating Web site visitors). None of these services ever attracted many developers, however, and MSN has largely abandoned the plan of charging developers to use its services—for example, ClearLead has been discontinued, and MSN no longer offers Passport to third-party sites.

Now, instead of licensing its services, MSN is giving developers free access to them. Although the business model differs slightly for each tool, in general, MSN hopes that wider development on top of its services will drive more traffic and advertisers to its properties. This is a tactic often followed by other parts of the company, which have made developer tools and documentation inexpensive or even free in hopes of popularizing Microsoft software as a platform.

MSN may also have been spurred in this direction by a threat from Web-oriented companies such as Google, which are building increasingly complex Web-based services and offering them to third-party developers. If Web-based applications become more useful and popular, many consumers will find less reason to upgrade their PCs or buy new software. Opening MSN services to developers is one way in which Microsoft can meet this threat—that is, even if users turn to Web-based applications for functions previously provided by software, Microsoft could earn revenue by displaying advertisements to these users. However, this business model depends on developers' willingness to let MSN advertising appear in their applications and end users accepting (and clicking on) those advertisements when they appear on non-MSN Web sites and applications.

Search, IM, and Maps for Developers

At Microsoft's 2005 Professional Developers Conference (PDC) in September, MSN announced tools for developers to build applications on top of MSN's Internet search engine and MSN Messenger instant messaging (IM) client. It also began allowing developers to incorporate Virtual Earth into commercial applications.

Search Web Service

The MSN Search Web service allows third-party applications and Web sites to display results from MSN's Internet search engine. The applications can retrieve any type of search result currently available through the MSN Search site, including sites from the entire Web arranged by relevance, local business listings with associated maps and driving directions, news stories, images, and entries in the online version of Microsoft's Encarta encyclopedia. By licensing reuse of its search results, MSN hopes to increase the number of end users exposed to paid listings that appear with some search results.

MSN is limiting the scope of third-party development on MSN Search, however: it will license the Web service only to noncommercial companies, each application or Web site may conduct only 10,000 queries per day, and only 50 results per query will be returned. In contrast, Google lets commercial sites and applications build on its equivalent Google Web APIs service as long as they get written permission. However, that service offers only 1,000 queries per day and 10 results per query.

Although the MSN Search Web service is based on common Web standards, such as the Simple Object Access Protocol (SOAP) 1.1, and can be accessed from a variety of programming languages and OSs, Microsoft is encouraging developers to use its own platform and developer tools. For example, the associated SDK and documentation are based on Microsoft's .NET development platform and developers must have Visual Studio 2003 and the .NET Framework to run the sample applications.

Messenger Activity API

The MSN Messenger Activity API allows developers to build HTML-based applications that can send information over the same peer-to-peer communication channel used by the MSN Messenger IM client, then embed these applications into the Messenger client user interface. By enabling new applications within Messenger, MSN hopes to increase the popularity of the free service, which will increase click-throughs on advertisements.

The Activity API will enable fairly simple multiuser applications (such as DHTML or Flash-based games), called Activities, to run as HTML Web pages in MSN Messenger's Activity window, which functions the same way as an Internet Explorer 5.01 browser window. Users will be able to launch Activities from directly within the Messenger interface. If developers prefer, they can require users to launch their Activity from a link on a Web page (which will also launch the Messenger application).

MSN must approve all applications that use the Activity API and will deny approval to any Activity that duplicates MSN Messenger functions, such as IM, application-sharing, or audio and video conversation. In addition, special permission must be granted for applications that use ActiveX controls, require an additional download (such as the Flash player), obtain users' IP addresses, or perform certain other behaviors.

At the 2005 PDC, MSN announced a contest for the best application using the Activity API; the winner will get a laptop computer and marketing assistance from MSN.

Developers should note that MSN is not opening its proprietary messaging and presence protocol (MSNP) to third-party developers. That is, developers will still have to do some reverse-engineering to create applications that let users discover contacts on the .NET/MSN Messenger service and establish communications sessions with them. In contrast, the new Google Talk IM client is based on the open Extensible Messaging and Presence Protocol (XMPP), easily enabling third-party developers to create clients that can interoperate with it.

Virtual Earth Open for Commercial Use

Introduced in July 2005, Virtual Earth allows users to type in a business name or street address and see the location on a map or satellite photograph. The service will eventually include features such as driving directions and user-annotated entries and will subsume the MSN Maps and Directions site.

Since Virtual Earth's introduction, a community Web site called Via Virtual Earth has (with Microsoft's approval) posted sample code and documentation explaining how developers can call a Virtual Earth API to display maps and associated listings within their own Web sites and applications. The site has also posted sample applications created with the API, such as a prototype application in which photo icons on a Virtual Earth map link to digital pictures taken in that location. However, although Microsoft encouraged the Via Virtual Earth community in its activities, it did not permit developers to incorporate Virtual Earth in commercial applications or services.

At the PDC, Microsoft announced that it had lifted this restriction, as long as developers include the "What" and "Where" search boxes that appear at the top of the Virtual Earth site. (For an illustration showing these boxes, see "Virtual Earth Interface".) Google Maps has a similar API, but it is currently restricted to noncommercial use.

For the time being, the Virtual Earth API will not generate new revenue for MSN. However, MSN says that it will soon enable third-party Virtual Earth applications and sites to display advertisements. MSN will also institute revenue-sharing deals with these third parties. The likely model here is Google's AdWords, in which advertisers pay for placement on third-party sites; Google then splits revenue with these sites based on the number of click-throughs they garner.

Resources

MSDN's new MSN Developer Center, which includes links to the documentation and SDKs mentioned in this article, is at msdn.microsoft.com/msn.

The contest to create the best MSN Messenger Activity is at www.worldsbestapp.com.

Via Virtual Earth, the MSN-approved community site for Virtual Earth developers, is at www.viavirtualearth.com. The public Virtual Earth site is at virtualearth.msn.com.

Google posts developer information and tools at code.google.com/index.html.