You're Right - You Shouldn't Diss Internal Blogs
Take a look at what Sun's Tim Bray has to say: "Today, in late 2004, there are exactly two companies in the world where blogging has gone wide-open: Sun and Microsoft. At both places, the impact has been overwhelmingly positive. Neither of us would consider going back for a second."
He is right. Those two companies are driving the use of this tool at the moment. As I have said earlier that is also an explanation as to why blogging isn't spreading even more rapidly than it is. But that's another discussion.
Getting back to Tim's post, I think he is wrong in one detail. He doesn't want to "...diss internal blogs, but in the big picture, it seems that their impact level is not even close to the outward-facing kind." Actually, with all the things we know about blogs, what they deliver and how they build relations, my bet is that in a few years the internal blog will be much more common than the external one. The Google experience points in that direction, for example.
I don't know any details of Tim's background, but my guess is that he hasn't worked much as a corporate communications professional. If he had, he would have known that external uses of new solutions or channels almost always proceeds the internal uses. The web/intranet development is a perfect example. I think it has something to do with the personalities of early adopters in the communications business. We just don't get any kicks (and very few prizes) from internal communication.
But - once an idea or use is established, internal solutions starts popping up. When blogs (and all tools for participatory communication) are widely accepted we will see money making team collaboration, product development, cross-departemental cooperation taking place with these tools.