Simplicity breeds success: the lasting impact of AOL Instant Messenger

eric bosco
Eric Bosco helped build AOL Instant Messenger as an engineer in the 1990s, then protect it from company politics as he rose through AOL’s ranks.
For many people over the age of 20, AOL Instant Messenger is a quietly iconic element of the early internet. Back when chatting online was still new and novel, AIM provided many users with their first opportunity to chat with friends via the net.

When AIM was in its earliest stages of development, Eric Bosco was working as an engineer for computer tech firm Oracle in the San Francisco Bay Area. He and his wife wanted to make the move to the East Coast, so he called in a favor from a friend working at AOL, who made sure that it fell into the right hands. By the end of 1996, he had relocated and started his tenure with the company.

“Talk about ending up in the right place at the right time,” said Bosco. That, perhaps, is an understatement. The work he and his team did at AOL formed the foundation for the billions of text messages that are now sent every day.

The Walled Garden

AIM buddy listHere’s a good example of just how different internet access was twenty years ago — when Bosco joined AOL, the company was still charging an hourly rate for customers to access its online services. “If you were an AOL subscriber in 1996, you had instant messaging, and you had the buddy list,” Bosco explained. These features were reserved for paying customers — they were kept within the “walled garden,” as he puts it.

A few months into Bosco’s tenure with AOL, it switched from its hourly rates to a flat monthly subscription of $19.95. A prudent business move, it drastically increased the user base, but also caused chaos as users made a mad dash to get online. The company struggled to handle the load.

“Any of the engineers who had been at AOL for a while where trying to fix this system that was completely broken,” said Bosco. “I asked my boss, ‘what do you want me to do?’ and he’s like, ‘I don’t know what you should be doing, because I’ve got to fix this thing that’s broken here’”. Bosco was given vague instructions to investigate how AOL’s internal messenger could be made to work with users across the internet.

A team was assembled, with the intention of breaking down the walls that separated AOL users from the other denizens of the internet. Even without an active subscription, other users would be able to sign into AOL Instant Messenger and chat with their friends.

AIM was almost three times the size of AOL in terms of users.

The team soon realized the idea was a double-edged sword. Removing the barrier made AIM better for its users, because they would now be able to communicate with a much wider range of people. But it also removed a major selling point of the paid AOL service.

“Those features were considered to be a real value proposition, of the reason that people paid AOL as much as they did per month,” explained Bosco. “And so the concern was very simple: if you’re giving away for free what our paying customers really like, then we’ll lose paying customers, or we won’t get new customers — we’re essentially cannibalizing ourselves.”


Fortunately, these concerns wouldn’t threaten the development of AIM until later on its lifespan. As 1996 faded into 1997, the team kept working without raising the ire of upper management.

“It was total skunkworks,” Bosco remembered. “No one really paid attention to what we were doing.”

Barry Appelman — the man generally recognized as the father of AIM and its buddy list functionality — had been with AOL since 1993, and was well-liked and respected among his colleagues. This allowed him to provide “air cover” for the continued development of AIM.

“Since we were engineers working under him, he had complete control over telling us what code to write,” said Bosco. “But once we wrote the code, the biggest problem was that you had to run it in a data center environment. You had to bring the system live. Organizationally, that meant running it in AOL’s data centers.”

This would expose the work that the AIM team was carrying out to other sectors of the company. Given that the project didn’t directly relate to upping a AOL’s subscriber count, it would be better if their efforts could be kept under wraps.

Fortunately, Appelman was able to find a way around this obstacle. AOL sourced servers from Hewlett Packard, and was in the process of exchanging a large quantity for newer models. He managed to secure around a hundred of these end-of-life servers for the AIM team, and Bosco helped install them in a quiet corner of a data center. “We sort of bootstrapped the whole thing, without asking for any other resources from anybody,” he said.

Appelman had a vision from AIM, and it didn’t take long for it to come to fruition.

In 1998, 10 percent of the entire AOL user base was making use of the service, and that number was growing rapidly. “We realized, ‘this thing is taking off,’ and in a very short period of time,” said Bosco. “By 2000, if memory serves me correctly, AIM was almost three times the size of AOL in terms of users. It really skyrocketed early on.”

Internal Affairs

Thanks to the success of AIM, Bosco managed to rise up the ranks of the company — indeed, by the time he left in 2005, he was the vice president of community and communications engineering. His increased stature meant that he took on a role as protector of the project.

“We had normal larger company politics going on,” he said. “My personal mission in life was to play those politics to make sure that not only should AIM stay alive, but that we could continue to innovate and keep our user base engaged, and to grow, and so forth.”

“The biggest ‘pull’ or tension, was between AOL’s customer acquisition machine, and AIM,” explained Bosco. “AOL would bombard the whole country with AOL CDs and floppy disks — you couldn’t go to the supermarket and buy a box of cereal without finding an AOL CD-ROM inside of it.”

Subscriber acquisition was a primary focus, but not for the AIM team. There were millions of internet users signing up for AIM, and AOL came to view these individuals as potential subscribers. The end goal was to trap free users into becoming paid users.

You couldn’t go to the supermarket and buy a box of cereal without finding an AOL CD-ROM inside of it

The millions of people that downloaded AIM were seen as prime candidates for a recurring monthly subscription for AOL. The idea was that the IM client would be distributed for free, but it would come packaged with an installation of the AOL client. Bosco likens the strategy to a Trojan horse, with the money-making component hiding away under the surface of a free program that users would want to download and install. The AIM user base was set to become a captive audience for AOL’s marketing efforts and subscriber acquisition campaigns.

“We felt like that was a terrible user experience for the AIM user,” said Bosco. “Even though aspects of it might have made sense for AOL.”

Internal entities were threatening the future of AIM — not intentionally, but as a natural result of the heft of a company the size of AOL. The balancing act of preserving the existing experience and attempting to innovate new features would have been challenge enough, but there were other forces set to make Bosco’s job even more difficult.

“We were not alone in this messaging arms race.”

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