updated 10/22/2004 7:07:09 PM ET 2004-10-22T23:07:09

Yahoo Inc. appeared to move a step closer to challenging Google Inc. in searchable Web mail, acquiring the startup behind the powerful e-mail application Bloomba.

It was Yahoo's second purchase this year of an e-mail startup following the July acquisition of Oddpost Inc.

Bloomba was launched last year by San Mateo, Calif.-based Stata Labs. Many analysts praised it as being more nimble and elegant than Microsoft's Outlook, but doubted Bloomba could survive without a larger patron.

That's exactly what Stata Labs found in Yahoo, the company's namesake, co-founder and chief technology officer, Raymie Stata, said in an e-mail on Thursday.

"For me, after a few months of serving on Yahoo's scientific advisory board, and seeing some of the amazing things going on there and the innovative culture they are fostering, I saw an excellent opportunity for the Stata team to operate on a bigger and more impactful playing field," Stata said.

However, the $60 product will be discontinued and Yahoo has no plans to sell Bloomba or its accompanying spam filter software, SA Proxy Pro, Stata Labs said on its Web site.

That could indicate plans to incorporate the underlying technology in an e-mail client that could compete with Gmail, which Google launched in April and which offers users full searching of their own e-mail boxes and 1 gigabyte of space to store messages.

Neither Stata Labs nor Yahoo could immediately be reached for financial details on the acquisition. Bloomba's appeal had increased this year with the addition of searchable calendaring to its e-mail and contact database.

E-mail serves as a powerful magnet that draws people to the companies' Web sites, which depend on a steady flow of traffic to increase advertising revenue.

The other e-mail company acquired by Yahoo this year, Oddpost, made a Web-based product radically different in approach from Bloomba but equally praised for simplifying the Internet's most popular application.

Stata Labs said it would provide Web and e-mail support for its discontinued products for a year and refunds for all purchases made in the last 30 days.

Copyright 2004 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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