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Microsoft to close free chat rooms to reduce spam

Microsoft Corp., the world's largest software maker, will close free Internet chat rooms on its MSN Web sites to help prevent junk e-mail and block access to pedophiles.

MSN, which has 350 million users each month, will stop chat services in Europe, the Middle East, Africa, Latin America and Asia. MSN will add pay services in the U.S., Canada and Japan Oct. 14, Redmond, Washington-based Microsoft said in a statement.

Chat rooms let users converse using text and have been used by senders of junk messages, or spam, to collect e-mail addresses and by pedophiles to share pictures and data. About 40 percent of U.S. e-mail is spam, according to sponsors of a bill in California that will be signed into law today by Governor Gray Davis and impose penalties of as much as $1 million for senders.

"Chat has unfortunately become an area that introduces a lot of unsolicited information and also different types of inappropriate material," Lisa Gurry, MSN group product manager, said in an interview. "Chat is also really somewhat of an outdated service. We've seen usage for it decline."

The move also lets the money-losing MSN, which is trying to cut costs, eliminate some of its free services. MSN, the No. 2 Internet access provider in the U.S., has been losing subscribers and has started charging fees for services such as Internet radio, calendar and digital photo software.

Microsoft will still offer free chat rooms in some countries where messages can be monitored and moderated. Some free and pay versions will be offered in Canada and Japan. Australia, New Zealand and Brazil will have some moderated chats, Microsoft said.

Tracking Data

Each MSN subsidiary was allowed to make its own decision on how to proceed as long as all unsupervised free chat was ended, Gurry said. MSN doesn't have a pay subscription service in many areas, so adding pay chat wasn't an option in those regions, she said.

By requiring payment or monitors, MSN feels it can control behavior that violates MSN's terms of use such as trafficking spam and pedophilia. A customer who engages in such practices can be tracked in a pay chat room using the credit card data.

Microsoft is working in conjunction with top Internet-access service AOL Time Warner Inc. and Yahoo! Inc., owner of the most-used group of Web sites, to limit spam.

Yahoo and other companies still offer free chat sites. Yahoo spokeswoman Melinda McRae didn't immediately return phone calls.

Turning Tide

AOL Time Warner's America Online in the U.K. shut chat rooms to non-subscribers this year, according to a statement from Camille de Stempel, director of policy for AOL UK. "We are pleased MSN has followed suit," de Stempel said. America Online in the U.S. didn't return calls for comment on its policy.

Microsoft Chairman Bill Gates in May sent a letter to U.S. Senators Ernest Hollings and John McCain encouraging federal legislation to fight spam. The company has filed suits against 15 alleged senders of spam.

"Over the next year, we will be able to turn the tide on spam," through a combination of legislation and improvements to network and computer software, Gates said in May.

Shares of Microsoft fell 98 cents to $28.62 at 1:55 p.m. New York time in Nasdaq Stock Market composite trading. Microsoft's elimination of chat rooms was reported earlier Thursday by the Financial Times.