While the announcement of Google Talk hasn't impressed many technology watchers like Mike Langberg, it is significant that Google decided to base their IM on industry standard XMPP.
AIM is the industry leader in IM with 51% market share or 54.3 million users and getting their loyal users to switch to a new IM will not happen anytime soon. Nonetheless don't underestimate the power of open standards to create a flurry of new competitive applications. The challenges to the big players in the IM space have already started. Russell Beattie extols the benefits of using XMPP and wishes his employer Yahoo! would support an XMPP gateway to Yahoo! IM. Let the innovations begin.
As the web evolves and publish-subscribe technologies become more prevalent there is a need for a common protocol. As Bob Wyman points out in this post innovative companies like PubSub are betting that standard will be XMPP. Now Google is backing up that bet with the size and clout that can make it happen.