Xoom.com Buys Into E-mail Again

Direct e-commerce company Xoom.com (Nasdaq: XMCM) announced today that it has acquired 100 percent of e-mail security company Private One, Inc. The move is an effort to strengthen MightyMail, the direct marketing e-mail solutions provider that it acquired in June. Financial terms were not disclosed.

Xoom.com will integrate Private One’s secure encryption technology into MightyMail, which helps companies build an online marketing strategy via e-mail. Businesses can use MightyMail’s service to create custom-branded e-mail for its customers.

Private One technology does not require users to download additional programs or know anything about encryption. Xoom.com plans to integrate Private One’s technology into its other services in the future.

“Private One’s technology will provide users of Xoom.com’s email service as well as users of MightyMail’s OEM email service with one of the safest environments for transferring sensitive information via email,” said Vijay Vaidyanathan, head of strategic technologies at XOOM.com. “In the future, it will also simplify the transaction process for members who purchase from us through our targeted email offers by eliminating a few steps that up until now have been necessary to ensure security.”

About Xoom.com

Xoom.com offers free services including homepage building, chat rooms, message boards, HTML email, online greeting cards, a Web page counter, clip art and downloadable software. The company generates revenue by allowing other companies to target its more than 9.7 million members with direct e-mail.

In the fall, Xoom.com will be merged with NBC.com, CNBC.com and portal site Snap.com to form a new company known as NBC Internet. Snap.com will be the anchor site of the new venture, which will weave together broadcast, portal and e-commerce services.

Stock Impact

Shares of Xoom.com were up 1-1/16 to 41-3/4 in early trading today after the news. Even after the gain, the stock is trading at significantly less than the price NBC has paid to invest in Xoom. In two separate rounds of investment, NBC has invested $55 million in Xoom.com at an average price of $57.30 a share.

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