Have blogs become an essential business tool?

[UPDATE, April 24, 2009: Here is part of the answer: Fortune 500 blog more than expected.]

The abstract of Jeffrey Hill's MBA dissertation from November 2005 reads:

"(…) Although weblogs are being promoted as a potentially valuable business tool in the trade press and mass-market business literature, informal surveys suggest that only a small number of companies are actually using weblogs.

Reliable academic studies about the use of weblogs in business have yet to appear. This study aims to contribute to filling this research gap by investigating the attitudes and experiences of small business bloggers using weblogs as a marketing and communications tool. Qualitative interviews were carried out with fifteen small business bloggers representing a wide range of business activities.

The results indicate that weblogs are being used for many different purposes and that the bloggers believe them to be an effective marketing tool. However, this perception is based more on the bloggers' trust in the benefits of the medium than on any measurable ROI (return on investment).

Moreover, there is little evidence that dialogue is taking place with customers, although the literature tends to advance this dialogue as one of the main advantages of using weblogs. More research needs to be done to determine who is reading company weblogs and what their effect on consumer behaviour is. (…)"

I wonder if anything has changed since? The ROI debate is still very problematic. Then again, if we view blogging merely as taking part in conversation, do we ever measure the ROI on talking with people in the corridor, on the street or in the shopping mall?

What do you think? Have blogs become an essential business tool?