AOL has acquired US-based storage outfit Xdrive to meet the "skyrocketing" demand from net users to save their music, pictures and video online.
Financial details concerning the acquisition of the privately-owned company were not disclosed.
Xdrive manages an online, centralised storage platform that gives subscribers access to all their digital assets. The California-based company also promises Xdrive provides its subscribers with: storage safety and security; and automatic backup of a wide variety of digital assets - such as music, pictures, and video.
Said Gio Hunt, a bigwig at AOL Digital Services: "The digitisation of consumer home media is skyrocketing, with consumers and AOL members increasingly looking for easier ways to protect and manage a wide variety of important data files and digital media assets, informs the register.
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, reports Mail & Guardian.
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