The reaction to Plaxo’s acquisition of Hipcal across the blogosphere has, for the most part, been extremely positive. We’re glad to see this, since we think the HipCal calendar application (and team) are fantastic, and will bring great value to our users.
However, a few people have asked why this makes business sense, especially since Google, Microsoft, and Yahoo! all have offerings in this space, and since there are a large number of standalone calendar offerings.

So, here are some quick answers to the following :

1. Why does this make sense for Plaxo Users?


2. Why does this make business sense for Plaxo?


3. How can you compete with Google, Yahoo!, and Microsoft in this area

1)Why does this make sense for Plaxo Users?
Plaxo provides users with a Smart Address Book that enables them to stay up-to-date, organized, and in-touch with the people that they care about.

To date, we’ve focused most of our efforts on the contact list, enabling:

1. Staying in touch with your data: Users keep a single set of contact information for friends, colleagues, and customers that can be used virtually anywhere, and that stays synchronized across multiple different platforms and accounts (e.g. Yahoo, Outlook, AIM, Mac, PC, mobile phones, and a number of online services)


2. Staying in touch with people: As friends who also use Plaxo move, change jobs, have birthdays, get new phone numbers, change e-mail addresses, etc.—we make sure that you know, and that your smart address book gets automatically, everywhere you use it.

That said, it has always been our conviction that address book and calendar should be intimately connected tools for staying organized and for managing relationships with the important people in ones life. So, we think it is natural—if not essential-- for us to offer calendar functionality – and have that calendar functionality deeply intertwined with the address book. In fact, for over a year, we’ve had a calendar that does the “Staying in touch with your Data” piece of the equation. (For example, you can edit and maintain your calendar at work in Outlook, and at home from your mobile, various online services, etc.) But…we haven’t enabled the “Staying in touch with people” part of the equation.

With the HipCal acquisition, we will solve this problem. We want to make it easy for you to coordinate setting appointments with other people, set up get-togethers, publish or subscribe to your kid's soccer team schedule, get automatic updates on the schedule for your favorite band, etc.

2)Why does this make sense for Plaxo’s business?

It’s pretty simple. Plaxo makes money when a percentage of our free users convert to premium services and pay a subscription fee. We also make money when our free users choose to send ecards, flowers, or gifts to each other, when they launch a search from Plaxo, when they see an ad on Plaxo, etc.

HipCal gives us:

• More reasons for people to join Plaxo


• More reasons for current users to stay active


• More opportunities to get people to use Plaxo on a daily basis


• More opportunities to launch new premium services

It also gives us five great new members for the Plaxo team.

3) How can you compete with Google, Yahoo!, and Microsoft in this area?

The short answer is that we won’t really be competing with them. All of those services currently offer address books. We don’t compete with their address books…we simply make them more useful and interoperable. To some extent, the same should be true with calendars.

Beyond that, though, I think it is clear that standalone, web-based calendars aren’t all that useful. A calendar application, even if it has lots of interesting features and a great interface, can’t exist as an island.

To be really useful, a calendaring application will need all of the following:

1. Tight integration into and with the other personal productivity tools people already use


2. The ability to be used anytime, anywhere, across multiple different tools


3. A large network of other users with whom you can set appointments, get together, etc.


4. And, of course, fantastic features and a great interface

Plaxo has already made a lot of progress on 1, 2, and 3. HipCal helps us really accelerate item #4. If a Plaxo member chooses to use one of the services listed above as their primary tool for calendaring—that’s great! We’ll simply help them integrate their calendaring experience with other tools and with other users.

For more on what people are saying, see:

Our press release
Internet News
The Daily Om
Red Herring
Techcrunch

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