Group online chat the latest iteration in real-time communications--is becoming a must-have business application. Chat has morphed from a late-night consumer favorite as companies have evolved their IT infrastructures from voice mail to E-mail to instant messaging.

While those technologies have been replacements for single conversations, chat is the beginning of a movement to replace group meetings. It offers workable communications support for far-flung project teams, with an attendant boost in productivity.

The added good news is that IT managers can easily support chat applications, and CIOs can make a strong case for chat's return on investment, especially when compared with voice conferencing and videoconferencing.

Consider chat's utility in the crucible of the armed forces, where group chat sessions are replacing more traditional radio communications among naval battle groups. "You can coordinate who is going where and monitor your tactical situation," says Peter Saint-Andre, executive director of the Jabber Software Foundation, which develops open protocols for instant messaging and other real-time communications based on XML.

Wall Street has led the way in the implementation of the technology because it offers traders a big, immediate payoff. "It's hard to be on the phone with 30 different guys at the same time," says Brian Trudeau, CIO of Amerex, an energy-trading firm. "Being a brokerage house, you want to be in contact with as many of your customers as you can and all at once."

"Chat is perfect," says Melanie Gordon, communications manager at Reuters Collaboration Services, "especially for busy people in the financial services industry who don't have the time to put together a telephone conference call." Reuters sells its own chat services software.

Traders are attracted to chat because they can create different "rooms" or chat channels for each market and conduct virtual meetings throughout the day without having to take time to be away from their desks. They also can work on more things concurrently and make better decisions. "Investment banks will have one chat room per trading desk, and everyone will be in there watching that particular market," says Saint-Andre. "Traders don't need their multiline phones anymore, since they can be in 30 or 100 different rooms, tracking different markets."

Chat and its close cousin, IM, have some intrinsic advantages over other communications technologies, such as E-mail. Chat provides in-box relief from the spam, viruses, and malware that can clog E-mail pipes. Companies that have implemented chat have seen their daily dose of E-mail drop. In some cases, chat almost completely eliminates internal E-mails. "My internal E-mail traffic, particularly with my close colleagues, has dropped dramatically now that we're all on IM all the time," says Tim Bray, director of Web technologies at Sun Microsystems.

EASY TRANSITION
Chat software is easy to learn and leverages the one-on-one chatting style made popular with IM software from AOL, MSN, and Yahoo; it's a natural extension of such tools. For staffers who grew up in an IM universe during their teens and college years, it's an easy transition and a natural means of communication. Its real-time nature means that questions get answered quickly and without a lot of the back-and-forth typical in the E-mail universe, and it facilitates multitasking.

"With online chats and IM, a call center can handle multiple calls simultaneously, versus a single phone call," says Arsenio Batoy, president of Optical Laser, a distributor of storage, content management, message management, and security products.

An additional case for adopting group chat stems from the availability of a growing core of chat-savvy developers. They're building chat-based applications using a variety of open source tools and well-documented sets of protocols. Those developers are constructing sophisticated systems, which include full-blown chat systems from Antepo, Jabber, Jive Software, Parlano, Reuters, Userplane, and others.