WALTHAM, Massachusetts -- Lycos, the fourth largest network of Web sites, said Tuesday it had agreed to acquire privately held Gamesville.com, the second most popular online games site, for US$207 million in stock.
In addition, Lycos (LCOS) said in a statement it would also assume responsibility for Gamesville's employee stock options program. Lycos plans to fold Gamesville.com into its network of programming, commerce, and community sites, which includes Wired News.
Gamesville.com, based outside Boston, counts 2.2 million members who compete in multiplayer games for prizes. It is the second most popular site behind Uproar Ltd. (UPRO.ED)
Lycos also said that visitors to Gamesville remain on the site, on average, longer that any other Web site except online auctioneer eBay (EBAY).
"The addition of Gamesville to the Lycos Network adds to our revenues, grows our average daily usage minutes by nearly 20 percent, and adds depth to our direct marketing efforts," said Bob Davis, Lycos president and CEO.
Gamesville.com uses "permission marketing" tools to target promotional offers to players who visit the site. It also targets TV-like advertising at regular intervals to its members, in another example of its power as an advertising vehicle.
"We were particularly attracted to Gamesville because of the exceptional quality of registration information, which considerably expands our direct marketing infrastructure," Davis said of plans to target users with cross-promotions.
Lycos said the acquisition boosts the audience reach of its network of sites. Lycos captured around 45.8 percent of the total Web audience in October measured by Media Metrix, which survey Internet traffic patterns.
The acquisition is expected to close by the end of the year and is subject to Gamesville.com shareholder approval.
