America Online said on Thursday it has bought the online storage company Xdrive to meet the growing needs of consumers with rapidly expanding collections of digital music, photos and other files.
AOL did not disclose financial terms but said it would operate Xdrive as a wholly owned subsidiary and continue to sell storage and backup services through Xdrive.com.
Xdrive’s 34 employees have moved to an existing AOL building in Santa Monica, California, the company’s current headquarters.
Nonetheless, AOL will likely incorporate Xdrive’s technologies into its existing services, just as it had after buying anti-spam company Mailblocks last year. The Xdrive platform will also allow AOL to centralise storage for its e-mail, web journal, photo and other services and create new options for consumers.
AOL officials, however, refused to provide specifics.
Storage needs for AOL have been growing. It recently began offering free web-based e-mail with ”aim.com” addresses and gave paid subscribers unlimited e-mail storage, instead of the 100 megabytes previously offered.
The expansion improves AOL’s ability to compete with the likes of Google, which jump-started a competition over e-mail services by offering more than two gigabytes of free storage.
AOL spokesperson Nicholas Graham said demand for storage would only grow as more households get high-speed broadband connections, making it possible to move large files, including digital video, off computer desktops.
He said the company decided against building a new storage system from scratch because Xdrive already ”invested millions of dollars and essentially hundreds of engineering years” to develop it.
AOL’s rivals have occasionally turned to other companies for emerging technologies.
Google recently launched Google Earth mapping software after buying map maker Keyhole, while Microsoft incorporated anti-spyware technology from Giant Company Software into its own product. Yahoo integrated elements of the Flickr photo service it bought into the 360 social networking product.
Shares of AOL parent Time Warner rose 28 cents, or 1,62%, to $17,55 in Thursday trading on the New York Stock Exchange. – Sapa-AP