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            Chat Widgets are coolest and useful widgets that adds spruce up on blog /website . Many Advantages of them like they are free and help to increase traffic , useful to share and comment information !
These chatboxes are an Embedded chat widget code that needs to be added in a blog/website providing the ability to connect more closely with your readers or customers, or visitors passing by your blog depending on the instance. Chat widgets / Chat boxes provide a real-time feedback and show live feed while comments show a lil bit of time to appear .

However there are disadvantages too like in some cases, widgets may slow down the page load or take away from the overall site experience rather than enhance it.It may lead to downfall of traffic or lead to many spammy IM's but that could be easily controlled by moderations .
Most of them require to sign up but in some of em you just choose a temporary user name . These though may be free but some may show ads or completely crash .
However still chatboxes can be seen like in 1 in a 100 blogs .
Heres the list of some great working chat widgets which i think should definitely given a try

1> Cbox
Most famous and most widely used also called as chatbox .Cbox is a unique commenting and chat widget that combines the best features of regular chat and tagging systems into one ideal solution. And the best part – Cbox Basic is completely free. Very light weighted and loads extremely fast . I will advice only this one :D

2> Chatroll
Chatroll is a provider of interactive tools for social publishers.Using copy-and-paste chat widget, publishers can instantly enable live social interaction within their online community and generate revenue. Over 50,000 leading publishers use Chatroll , including live radio shows, fan sites, video streams, live sports, stock traders, charities, and more.


3> MeeboMe 
Meebo me is fast loading and If you've got a web page where you'd like to communicate with your visitors, meebo me allows you to see the people who are visiting your web page and chat with them ! It features publisher status, user nickname editing, and sound control. Also be sure to check out MeeboRooms, launched recently .Its not in beta but alpha !

4> Plugoo
Plugoo is a little chat widget that enables you to talk with site visitors via your IM client. Meet new friends all over the world and chat instantly !  Work as usual without having to keep an eye on the chat box , then if someone initiates a chat, a message will pop up on your IM.  in Beta

5> Userplane
Get your own instant video community! Get a free webchat, webmessenger, and userlist for your community instantly! Also paid packages are available .

6> Chatango
Chatango is a personalized chat widget . Very famous site to chat with anyone by selecting country , age ,gender . Very customizable widget , set-up was easy, but very very flashy :o|

7> Zoho Chat
Group your contacts based on different criteria. Chat easily with groups instead of adding contacts individually each time.Access Yahoo, Google, MSN, AIM, ICQ & Jabber IMs all at one place. Conference chat with your contacts from multiple Instant Messaging (IM) networks .Easy Embedding of Chat Boxes , loads fast .

There were many more but some of them are not opening giving errors while some of them are being offered for sale ,OMG . If still there is a site that needs to be added up , comment here , i will add up