Yahoo, SBC Extend Internet Pact

Yahoo and SBC Communications will collaborate to extend to cell phones and home entertainment devices some of the online services and content they currently provide to PC users.

The two companies, which have provided co-branded DSL and dial-up Internet service since 2002, announced this week they have agreed to continue that partnership and extend it with new services that will be available next year.

Subscribers to the co-branded DSL and dial-up services receive not only Internet access, but also a variety of complementary services, such as e-mail, security tools, and multimedia content.

The planned new services include:

• Project Lightspeed and Home Entertainment, for extending to home entertainment devices, such as television sets and stereo equipment, Yahoo-SBC services and content, such as video on demand, Internet radio, and online photos.
• Cingular Wireless, for extending Yahoo-SBC content and services to Cingular Wireless subscribers.
• SBC FreedomLink Wi-Fi, for integrating Yahoo-SBC content and services with the SBC Wi-Fi service.

Past the PC

The companies' initiative is a clear attempt to move Internet services and broadband content beyond a PC's boundaries. Users increasingly expect to have access to Internet services and content from wireless devices and consumer electronics products.

A race is brewing in the IP television segment between Yahoo and Microsoft's MSN, with Yahoo grabbing an early lead, one analyst says.

"I see IP TV as a venue for all types of new content," says Allen Weiner, a Gartner analyst. Weiner predicts that Yahoo will begin "creating all kinds of new content" in the future, both as a TV producer and as a TV network.

Microsoft's MSN is in a position to challenge Yahoo, but "Yahoo is well ahead of MSN" in this space right now, Weiner says.

The companies didn't provide information on when next year these services might be available or at what price.