AOL Buys Video Search Firm

Time Warner's (TWX Quote) America Online unit announced Tuesday the acquisition of closely held video search company Truveo, continuing its expansion into an area that experts predict will explode in popularity over the next few years.

Truveo has a proprietary technology called "visual crawling'' that lets it automatically discover video files on Web pages, enabling customers to see updated information on news, sports and entertainment. The acquisition, which closed Dec. 21, was AOL's fifth last year. News of the deal wasn't released until Tuesday. Terms were not disclosed.

"Consumers across the Web have eagerly anticipated a video search engine that offers relevant, up-to-the-minute premium search results,'' Jonathan Miller, chief executive of America Online, says in a statement. "The Truveo acquisition takes AOL even farther down the path of being the premier destination on the Internet for search and video.''

AOL is considered by advertisers and analysts to have the most extensive video content on the Internet, a factor that contributed to the recent battle between Google(GOOG Quote) and Microsoft(MSFT Quote) over who would form a partnership with the Time Warner business. Google eventually won, agreeing to invest $1 billion for a 5% stake in AOL, which has a library of more than 20,000 original, premium video assets. AOL has also created its own original programming, including The Biz, a reality show in which contestants vie for the chance to run a record label.

AOL's video prowess came to the attention of the public last summer after its broadcast of the Live 8 concerts received critical acclaim while the television showing of the event was panned. The company's Truveo acquisition complements its 2003 purchase of Singingfish, a search engine that has an index of about of 2.5 million video assets.

Yahoo! (YHOO Quote) and Microsoft's MSN Network are also interested in expanding their video capabilities.

Last week, Google added to its existing video search capabilities the ability for people to buy episodes of some television shows, such as The Brady Bunch and the CBS hit Survivor. Apple Computer (APPL Quote) began offering video shows such as NBC's Law and Order last year.

Shares of Time Warner, also the owner of CNN and the Warner Brothers film studio, were recently down 3 cents to $17.53.