Update: See here for a good discussion of how Plaxo is dealing with accusations that it is a spammer tool.

plaxo.jpgWe carry news in the Mercury News (free registration) today about a big breakthrough for Plaxo, the Mountain View start-up that offers a Web-based contact update and management tool. America Online said today (see full release) it will be using Plaxo to help AOL members and users of its AOL Instant Messenger service keep their e-mail address books up-to-date.

This is a big deal because it is a move in the direction that Plaxo co-founder Sean Parker originally had in mind for Plaxo: A neutral protocol that could work with many players, allowing interoperability among otherwise closed platforms such as AOL, Yahoo and MSN — and one that could ideally be expanded beyond simple contact management. Sort of analogous to what Cisco did for networking.

Indeed, according to the announcement, the Plaxo product will also make it easier to access AOL’s services from other e-mail programs, the companies said. It will be rolled out this summer, and generally available by September, they said.

Note: Irony is that Parker was later ousted from Plaxo by the venture capitalists on the board, in part, we hear, because an early 2004 deal he sought with AOL along almost exactly the same lines fell through when AOL didn’t sign. We haven’t confirmed this, but have asked the company for comment. Also, Yahoo apparently passed on a similar deal, for reasons we don’t yet know (we’ve asked Yahoo for comment). Yahoo settled for a deal in which it allows users to incorporate Plaxo into its toolbar, allowing them to sync information between the Yahoo address book and Outlook. But “it’s not an integral part of the Yahoo experience,” said Plaxo Chief Executive Ben Golub.

In any case, let bygones be bygones. Future looks brighter. Plaxo has slightly more than 5 million users, according to Golub. He tells us he hopes the AOL deal will give Plaxo from 30 million to 50 million users by the end of next year (AIM has 30 million users, and AOL has an additional 20 million users). “This is far and away the biggest deal we’ve done as a company,” he said.


The deal was struck when Chamath Palihapitiya, general manager of AOL’s AIM and ICQ instant message services, reached out to Golub, ten days after Golub arrived in January.

Palihapitiya, who arrived at AOL in September of last year, told us he realized there was a lot more to do to help AOL’s users better organize the addresses they carry on multiple devices and platforms. As part of its drive to “aggressively” build out of AOL’s messenging and communication services, AOL is about to launch a “great VOIP” solution, he said.

So why go with Plaxo? “The vision of what we wanted was quite robust,” explained Palihapitiya, “but it already existed with Plaxo. It was much easier to partner.” He continued: “We don�t have a ‘not- invented-here’ syndrome.”

Here’s Reuters story.

Update: Plaxo got back to us with our question about the prior AOL talks. “We had some preliminary discussion with AOL early last year, but the discussions that led to this deal started in earnest in January of this year.”