Yahoo Buys Xoopit to Boost Photo-Sharing Versus Google, AOL

Yahoo scoops up Xoopit, a Web services specialist that combs through the glut of files, photos and videos floating in users' Yahoo Mail and Google Gmail clouds and lets users post the content on other social networks and blogs to share with their friends. Yahoo hopes to place ads around the tool, which has powered the My Photos section in Yahoo Mail since December. Google, AOL and others lose out on this one.

Yahoo confirmed earlier reports July 22 when it said it agreed to buy media file-sharing software specialist Xoopit.

Yahoo declined to confirm the purchase price, though AllThingsDigital, which first reported the news July 21, claims the price is in the $20 million range.

Many media reports are describing Xoopit as another photo organization and sharing service, which would put it in the same arena as Google's Picasa or Yahoo's own Flickr site. But Xoopit, which eWEEK first covered in April 2008, does more. It's also a personal media browser application that lets users aggregate social networks and media content in Gmail.

The Xoopit technology searches files, photos and videos floating in users' Yahoo Mail and Google Gmail clouds and lets users post this content on other social networks and blogs. The software imports media from photo- and video-sharing networks such as YouTube, Flickr, Kodak, Shutterfly and Picasa.

Now it will be part of Yahoo's not inconsiderable repertoire of Web services that help the company's hundreds of millions of users share Web content. The move is a natural fit because the two companies have been working together since December; Xoopit is the driving technology behind Yahoo's "My Photos" application in Yahoo! Mail.

While Xoopit was free, CEO and co-founder Bijan Marashi told eWEEK last year he expected the company would place paid ads on the service, which is something that Yahoo will certainly try to do. Yahoo is already keen on improving ad sales on its home page with its clever My Favorites application feed section.

Bryan Lamkin, senior vice president of Yahoo Applications, explained the value Yahoo users will get from the Xoopit buy:

Xoopit will bring phenomenal photo organization, improved photo sharing and the serendipity of discovering forgotten photos to Yahoo! Mail. Why is this such a big deal? Yahoo! Mail is actually home to one of the largest online photo repositories in the world. And every day, millions of you use Yahoo! Mail as your primary way to share the photos of important moments in your lives. While social networks and community sites are great for sharing photos with everyone you know, we realize it's not for everyone or every occasion. For many, e-mail is still best for sharing photos among a more select group of friends or family. And now we're making it all that much easier for you.

Xoopit began life as a Gmail and iGoogle plug-in for Firefox before it began working with Yahoo Mail last year, but Lamkin said Yahoo will continue to support the Xoopit Firefox plug-in.

The Xoopit buy is the second piece of major news to have leaked from Yahoo this week, with AllThingsDigital and the Wall Street Journal reporting the buy plans just one day after the Wall Street Journal broke the news that the company was planning an opt-in beta test of its new home page.

If the pattern holds, Yahoo should be reporting a major search and online ad deal with Microsoft soon. Last week, AllThingsDigital and 24/7 Wall Street reported that Yahoo and Microsoft were working on a multibillion-dollar deal in which Microsoft would pay Yahoo to run its ads on Yahoo's search engine.