The contact list is just a list: generally a window that has a list of screennames that represent actual other people. Double-clicking on any name will open an instant messaging session and allow you to talk with that person. Usually, if somebody shows up in your contact list, your screen name will show up in theirs.
Some text message clients allow you to change your display name at will (MSN Messenger), while others only allow you to reformat your screen name (Add/remove spaces and capitalize letters). Generally, it makes no difference other than how it's displayed.
With most programs, the contact list can be minimized to keep it from getting in the way, and is accessed again by double-clicking its icon (on a PC).
The style of the contact list is different with the different programs, but all contact lists have similar capabilities.
Such lists may be used to form contact networks, or social networks with more specific purposes. The list is not the network: to become a network, a list requires some additional information such as the status or category of the contact. Given this, contact networks for various purposes can be generated from the list. Salespeople have long maintained contact networks using a variety of means of contact including phone logs and notebooks. None of them would confuse their list with their network, nor would they confuse a sales contact with a "friend" or person they had already worked with.