One key challenge facing Facebook is how to diversify.  The company owns one of the top two spots in social networking and boasts millions of users, is reportedly worth billions, and has been courted by Microsoft.  Yet despite all this success, the company faces stagnation unless it can find new markets to grow its business.  Competitor MySpace has already done this in some respects by heavily promoting its music functionalities and by soon launching its own iTunes competitor.

Now Facebook has decided to leverage its user base of millions of users to expand it a surprisingly logical and fitting market-- instant messaging.  Facebook, which has 69 million reported users, previously featured an email like messaging system and a bulletin board system known as "The Wall", but lacked real time messaging features. 

Now Facebook Chat, a new feature that is being automatically rolled out, will allow users to see which of their friends are available and with just a click message available friends in real time.  There's no need to build a friends list, as most users already have long lists of their friends.  And you'll never forget who someone on your buddies list is, as you can just peek at their profile.

The new chat feature only supports one on one chat, making it very similar to AOL Instant Messenger (AIM), the current number 1 IM program in the United States.  Users can view previous conversations, but conversations are only stored for a short time and can be deleted at any time.

Chats take two forms:  either through typing at the bottom of the screen, or by typing in a separate pop up window.  If users wish they can allow information about chats to appear in their mini feed.  This may concern some users, for privacy reasons, but Facebook feels that the issues are properly dealt with.

Josh Pasek, a graduate student in political communication at Stanford University, thinks the program will spell trouble for market leader AIM.  Says Pasek, "[Facebook Chat] looks like it's going to be an interesting and useful feature.  My bet is that this will surpass [Google's] GChat as No. 2 behind AIM, because it's so universally used and logged into."

Likewise Patrick Thornton, who runs The Journalism Iconoclast says that between Gmail's chat and Facebook's new chat, he will now be able to IM any of his friends and no longer needs AIM.  Thornton states, "Facebook is a platform that allows people to connect in much deeper and more visceral ways than a standalone IM client ever could.  Why just talk to someone when you can experience them? That's what Facebook allows people to do."

Thornton and many others believe that Facebook’s fuller features in addition to messaging will make AIM go the way of the dinosaur.  AOL spokesperson Erin Gifford disagrees and points out that AIM users can incorporate their screen names into their profiles.  By clicking on the screen name of a friend, it will pop up and IM window in AIM if they're online.  It also shows their AIM status in the Facebook profile.  States Gifford, "We believe that AIM users will continue to use AIM within Facebook and from wherever they are on the Web and on the go."

AOL has its own social network, which competes with MySpace and Facebook, so it’s no stranger to competition against the younger company.  AOL's social network boasts over 80 million users thanks to the acquisition of Bebo, one of the most popular foreign networks.

Facebook declined to comment on the situation.  Facebook's chief social networking competitor Myspace already put out an IM program called MySpaceIM, but despite its 110 million users has not seen major use of it.

Previously, Facebook supported chats only through third-party applications.  This will be the first official chat feature, appearing on all profiles.  While users can appear as if they are online by choice, like in AIM, one privacy concern is that you can block someone from chatting with you if they're your friend.  Russell Beaumont-Ede of Exeter, England, shares these concerns, but feels that Facebook has taken its time and created a solid product, stating, "I believe that this feature has been developed over a long period of time, which to me would ease any concerns I have."

The new service adds to the jumbled mess that is among the undoings of unified communication.  User can juggle conversations on AIM, Yahoo! Messenger, MSN Messenger, Gmail and Facebook among others.   Gil Varod, a computer programmer based in New York complains, "Not only do I need to keep each of the IM programs open now, but I also need to keep a copy of Gmail open in my browser, and now a copy of Facebook open in my browser.  It's not like I need five different e-mail programs open to e-mail five different people."

Varod is a believer in client services such as Digsby or Pidgin, which consolidate your buddy lists, allowing you to talk to anyone.  He hopes someone gets these programs working Facebook Chat he states.

On Sunday the new service rolled out and as of Tuesday, Stanford, Berkeley, Harvard, Yale and Brown were among the networks that had added the feature.