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Lycos aims at profit thru paid chat

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CIOL Bureau
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LONDON: CEO Christoph Mohn has said that premium Internet services -- including what is believed to be Europe's first subscription chat service would be a central component in the company's push to generate 100 million euros ($107.7 million) in subscription revenues in the next three years.

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The move to charge customers for traditionally free services has become an increasingly common strategy for Internet firms having difficulty generating income from selling advertising.

Lycos Europe notched up its first core profit last quarter of 1.5 million euros, achieved through aggressive cost-cutting. The company laid off 400 people, or roughly one-third of its staff in the past year, as it restructured the company into a subscription-based online outfit.

Mohn said the company would not be reducing staff further, but instead is looking to boost subscription revenues by developing new services such as Web site hosting and online dating.

The company set a goal of net profit of 20 million to 45 million euros in the next three years, Mohn said. The subscription chat service, launched in the UK earlier this month, has signed up "a few thousand" subscribers, paying a range of one pound ($1.58) per month to 40 pounds per year for specific chat topics, Mohn said.

"We are the first Internet company that I know of that charges for this," said Mohn, Lycos Europe's largest individual shareholder, holding an 11 percent stake in the firm.

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