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TALLINN - Nokia, the world's top mobile phone maker, says it is to buy US-based social networking and photo sharing site Twango as millions of internet users flock to similar sites like MySpace and Facebook.
Twango allows users to share their photos, videos or audio files, acting as a social networking site.
Nokia said it would unveil plans for the site next year. It did not disclose the price it will pay for Twango.
Internet social networks are rapidly becoming a key element in the future of the media business, according to analysts. News Corp.'s 2005 acquisition of MySpace has boosted the value of Rupert Murdoch's media conglomerate.
Nokia has increased its acquisitions under Chief Executive Olli-Pekka Kallasvuo, who took over in June 2006, buying German navigation firm Gate5 and US based digital music distributor Loudeye to strengthen its multimedia business.
"The Twango acquisition is a concrete step towards our internet services vision of providing seamless access to information, entertainment, and social networks," Anssi Vanjoki, head of Nokia's multimedia unit said in a statement.
"We have the most complete suite of connected multimedia experiences including music, navigation, games, and - with the Twango acquisition - photos, videos, and a variety of document types," he said.
Twango was founded in 2004 but US traffic data from measurement firms Hitwise and Quantcast and global data from Alexa.com show it has found only a small audience so far compared to sites like YouTube or Flickr.
The media and mobile phone industries have been looking to the social networking boom to move over to cellphones, but so far limited usage of internet on handsets has put a lid on the potentially lucrative business.
"This is a logical next step in Nokia's services strategy as it looks for new revenue streams beyond its mobile phone hardware business," said Ben Wood, Research Director at consultancy CCS Insight.
"Nokia has little option but to go in this direction and it has been clear about its strategy to grow its services business to complement the mobile phone hardware division," Wood said.
Nokia has increased the appeal of its top-end multimedia phones through partnership agreements with sites such as Flickr, but Wood noted Nokia could risk losing access to these well known branded services by pursuing its own service.
"This will not impact our current partnerships, these will continue and we hope to sign up some more partners because in the end consumers decide into which communities they want to belong," said Nokia Multimedia unit spokesman Kari Tuutti. Nokia said Twango service would continue as it is in the near future, while it would unveil its plans regarding the site in the first half of 2008.
- REUTERS
