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Yahoo, Lycos Europe strike alliance

Yahoo Inc. and Lycos Europe, rival Web portals now turned business partners, will swap Web chat and instant-messenger technologies in a cost-savings move, the companies said on Thursday.
/ Source: Reuters

Yahoo Inc. and Lycos Europe, rival Web portals now turned business partners, will swap Web chat and instant-messenger technologies in a cost-savings move, the companies said on Thursday.

Beginning on Thursday, Yahoo's roughly one million European Web chat users will be switched over the next three months to Lycos Europe's chat platform, nearly doubling the size of the chat community in the process, the companies said.

And, later this year, Lycos Europe will use Yahoo Instant Messenger as its sole instant messenger technology.

"From our own standpoint, standalone Web chat was not a business priority of ours. On the other side, IM is a priority for us on a global level," James Barfield, consumer and networked services director for Yahoo Europe, said, explaining the rationale behind switching technologies.

The companies said the technology change-over would be straightforward for users. For example, Yahoo chat users can keep their current registration information, including e-mail, but would have to re-apply for a new chat nickname.

The technology change will affect Yahoo Europe users in Britain and Ireland, Germany, France, Italy and Spain, and Lycos Europe customers across the continent.

The companies announced last December a business alliance in which they would cooperate on a variety of business across Europe.

At the time, Lycos Europe agreed to extend its contract with Yahoo's Overture unit to sell ad-sponsored search links on Lycos Europe's search engine. Later, Yahoo agreed to outsource its Web shopping business to Lycos Europe's Pangora unit in the German and UK markets.

The companies said further reciprocal alliances are possible, but did not elaborate. The companies declined to discuss the anticipated cost-savings from the latest alliance.