03.27.06, By Mark Hachman

Lycos announced Lycos Phone on Monday, adding free multimedia-enhanced VOIP communications as a key part of its portal infrastructure.

The Lycos Phone service will allow users free PC-to-PC communications to any other Lycos Phone user, consistent with other PC-to-PC applications, like eBay's Skype. However, Lycos has gone a step further and will also provide users with a free U.S. phone number, so that callers can dial in and talk to a Lycos customer on his desktop or laptop computer.

The downloadable application also includes multimedia functionality, such as the ability to stream movie trailers and other content. A free voice mail-over-email service has also been included in the current offering, while a future upgrade will add a free fax number, according to Brian Kalinowski, Lycos' chief operating officer.

"I think the business model? is that it will be an entrance into Lycos products," Kalinowski said. Integrated into the application will be a Lycos search box, and content pulled by the player application itself from other Lycos properties, Kalinowski said. The player will stream banner ads ? delivered by a "traditional" banner advertisement box, and not via "adware," Kalinowski said ? that will offer the "broadest to the deepest" offering to users, he said. Chatting and MP3 music services have also been integrated.

The software application was actually developed by a Lycos partner, Globe7, whose software was designed for the Microsoft Windows 2000 and XP operating systems. Future upgrades will add support for Linux, Mac OS, Palm OS and Pocket PC, Lycos said.

"PC-to-PC" VOIP, unlike services from Sunrocket or Vonage, require either a USB headset with microphone or an integrated microphone and set of speakers, such as those found on a laptop. The Lycos service does not allow the Lycos customer to use a hardware phone, although traditional landline callers and mobile handset users can dial the Lycos application using the free phone number.

Portals are increasingly adding VOIP as a value-added service; before Lycos, the latest entrant was Yahoo, which a VOIP-enhanced enhancement to its Yahoo Messenger application last week. Although Google has yet to announce its own VOIP offering, the company provides a "Google Talk" chat application, and VOIP provider VOIP Inc. has already disclosed a a material agreement that has stated that the company has now moved out of a trial period to a "direct peering relationship with Google for the transport of [VOIP] services at multiple locations," with revenue expected to be recorded in 2006.

"We've been talking about the convergence model for media and technology for the last ten years, but it's finally happening," Kalinowski said, driven in part by Intel's Viiv initiative, that has tied computing and television closer together.

"I think that to be a traditional portal you have to provide content for video-on-demand use, by your television set and your computer, not just TV and web browsing but streaming media and broadband media and a VOIP solution," Kalinowski added. "We're taking desktop applications to a whole new level."

Although the application is free, users will have to pay for international calls as well as some mobile numbers. Lycos is offering 100 free minutes when users sign up for the service. Users can also upgrade to "Gold" status, also for free, by validating their email address. The additional tier of service was provided to help cut down on users registering multiple accounts to receive more free minutes, Kalinowski added. In return, Gold members will be offered discounts that will push U.S domestic landline calls down below a penny a minute, he said.