May 21–Mountain View’s Plaxo is expected to announce today the launch of its free software, Plaxo Contacts 1.0, that enables users to easily and promptly update their computer’s address book.

The company, founded by Sean Parker, co-founder of Napster, and two Stanford engineers, has tested the product with tens of thousands of users, according to Parker. In February, Plaxo raised $2 million in venture capital from Menlo Park’s Sequoia Capital and angel investors.

Several competitors seek to update a user’s address book by sending out requests for information from contacts, but are unable to make the changes automatically. Plaxo is one of the few using a Web-based “synchronized network,” which performs updates in the address book as soon as a contact makes a change. If a contact is not using Plaxo’s downloadable software, Plaxo relies on requests.

Plaxo supports only Microsoft Outlook and Outlook Express, but plans to roll out other versions that will make it platform agnostic. Plaxo will charge for a business product it plans to release by year’s end.

Stuart Alsop, a venture capitalist with New Enterprise Associates who is not an investor, said he tested the product, and found it better than Good Contacts, a competitor.

However, he said he was concerned about whether the Web-based storage of the contact information is secure enough.

Rob Enderle, analyst at Giga, expressed similar views. “This could save you from hours a year to hours a week,” he said.

But Plaxo’s success depends on security implications, he said. Plaxo’s vice president of product development, Rikk Carey, said the company is using technology that offers the same protections that financial institutions use to keep their transactions secure, so that users can assured about the privacy of their data.

Michael Moritz, partner at Sequoia Capital, said he invested in Plaxo because its one of those things that “a few years from now, people will wonder how they ever managed to get by without it.”

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