BOSTON -- International Business Machines Corp. said Wednesday it bought privately held WebDialogs Inc., pitting the technology services titan against Cisco Systems Inc. in the market for conferencing services over the Web.

WebDialogs, a company based in Billerica, Massachusetts with 500,000 customers, provides Internet services that let clients work together over the Web while they are connected through audio and sometimes video connections.

IBM's Lotus division sells desktop software with comparable features, but the company had not offered customers the option of buying the service over the Internet.

The financial terms of the deal were not disclosed.

WebDialogs' biggest rivals are WebEx, which Cisco bought in May for $2.6 billion, and Citrix Systems Inc., which advertises its GoToMeeting and GoToWebinar offerings to small businesses over the radio.

Story Continues Below

WebDialogs is a "white label" service provider, which means that the bulk of its business is performed for other companies that market the service under their own brand, reselling it at a profit, said Sean Poulley, vice president of strategy for Lotus.

© Reuters 2007. All rights reserved. Republication or redistribution of Reuters content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Reuters.

Editor's note:
Harvard U. investment advisers beat Buffett, Soros, Templeton. Put their strategies to work for you in 2007.
4 Foreign Currency Plays to Beat the Falling Dollar.
Will the Liquidity Crisis Sink Your Stocks? 12 Ways to Profit.