Hoople - 6:41 pm on Sep 12, 2010 (gmt 0)
There are many chat modules out there done in java (wrapped in PHP). Although cheap and popular they have issues. Some PC's who's java is not in full health fail to load the app fully or it's crippled. The second issue is the one time java security pop up. If they answer 'no' or 'never' they don't get chat. Some people won't run unsigned java apps. Signing is simple and free to do (with enough searching).
There are a few AJAX based chat modules that have the added bonus of running on low end cell phones. I've made a few with both types on a few sites, I've always settled on the AJAX ones. Search on 'ajax chat client' for a lot of good ones.
Many module authors host their own small IRC network for your chat room. Not having to build a chat server is a BIG plus. Quite a few allow branding and skinning customization of the chat client and more secure chat room modes.