Daum Communication is boosting its U.S. business, with its subsidiary Lycos launching an Internet telephone service.
Daum Communications Corp., one of Korea’s second largest portals and e-mail service providers, expanded its internet-based telephony services to the United States via U.S. portal Lycos Inc., which it acquired in 2004.
Lycos said it started a free, PC-to-PC voice and video service, and a free, PC-inbound service from fixed-line and mobile phones. The outbound call rate from a computer to a telephone within the United States is a penny per minute, the company said…
Daum said in a statement Lycos will provide Voice over Internet Protocol (VoIP) services in the U.S. Lycos will employ differentiated services in the market which has already been occupied by high-profile portal operators such as: “Time Warner’s America Online, Google, Microsoft, Yahoo, eBay’s Skype and EarthLink.”
The U.S. VoIP market already has several players, including e-Bay’s Skype, Time Warner’s AOL, Google, Microsoft, Yahoo and Earthlink.
Voice-over-Internet protocol is a technology that enables voice signals to be sent over the internet, providing cheaper voice services for customers and allowing the conventional adoption of advanced communication services such as video-conferencing and data casting.
Further, Lycos offers a free 100-minute call in PC-to-fixed line, PC-to-mobile services.
The Internet phone service, VoIP, will be managed by New Jersey-based technology firm, Globe7.
This partnership with Globe7 allows Lycos to team with a best-of-breed global platform, leveraging Globe7’s real-time communications infrastructure to provide other innovative services like Internet Protocol television, said Lycos’ CEO Alfred Tolle, who also heads Daum’s global business.
We are in a very unique position to now provide this audio and video distribution platform to our millions of independent content creators throughout the Lycos Network, he said.
When the free 100 minutes are used up, Lycos charges below 1 cent per minute in PC-to-fixed line and PC-to-mobile, while Skype charges 2 cents and Yahoo Messenger 1-2 cents per minute, Daum said.
Also, Lycos offers directory assistance service and fax service for free.
Daum acquired Lycos in 2004 in a bid to penetrate into the U.S. market.
Lycos was one of the first Internet portal companies in the United States. It was purchased for $12.5 billion dollars, in 2000, by Terra Networks, a subsidiary of the Spanish telephone company Telefonica. Unprofitable for years, it was sold to Daum Communications for $95.4 million in 2004, less than 1 percent of the price of four years before.
Until last year, however, Lycos failed to show satisfactory performances in the U.S., and continually lost market share. Daum said the net sales of Lycos was, 14.5 billion won last year, with a 9.4 billion won operating loss. Lycos was ranked 21st in the list of the most frequently visited Web sites in the United States, according to research firm Comscore Media Metrix.
Internet voice call services have been in the market for years. The technology was spotlighted when South Korea’s Serome technology began its free Dialpad service in 2000.
Serome expanded the service to 10 other countries including the U.S. but it soon lost its charm because of poor voice quality and its policy forcing users to watch advertisement during calls. Since then, no Korean company dared to enter the U.S. market.
The number of the Internet phone users in the U.S. increased from 1.3 million at the start of 2005 to more than 5 million today with companies such as Skype, Yahoo, and Vonage starting such services. Vonage leads the pack with a 47.5-percent market share.
Expecting the voice phone service to bolster to the firm’s re-emergence into the top tier of Internet businesses in the United States, Daum said it will be the first to introduce a VoIP system which “brings full multimedia support for music and video on demand for both professional and independent content.”
Daum also plans launching a similar service in South Korea before summer, though it will be separated from Lycos’, Daums spokesperson Hur Ji-yeon said by phone.