Telecom's digital venture with web giant Yahoo is set to go live next month, with localised versions of Yahoo's mail, instant messaging, search and news services coming first.
Mobile phone services and movie downloads could also be available if plans for Yahoo!Xtra are as ambitious as those of Australian sister site Yahoo7.
The Seven Media Group, which has indefinite rights to Yahoo's Australian and New Zealand platforms, recently celebrated Yahoo7's first birthday and finally confirmed a longstanding agreement with internet movie provider ReelTime that will allow users to download movies and TV shows using their broadband connections.
A download-to-rent service would let internet users access a movie for a set duration but a download-to-own option would allow them to keep a digital copy of a movie and burn it to DVD or store it on a hard drive.
Comparing www.yahoo7.com.au and www.xtramsn.co.nz, one finds more features are available on the former, but it is unclear what services on the Yahoo7 website, from streaming radio stations to user-generated blogs, will be available when the local site launches on March 1.
A preview page of Yahoo!Xtra suggests a suite of Yahoo Mail, Messenger and Search, all now available for free, will be offered through the website.
The debut of Yahoo!Xtra is likely to generate interest in MyYahoo, a customised internet start page that allows users to access their email, track news feeds and view calendar and contact information all on one page that is automatically updated.
Microsoft, Google and smaller players such as Netvibes offer similar free services.
Telecom is understood to be leaving the content management of its new portal joint venture to Yahoo7, maintaining just a skeleton editorial staff to manage local news, sport and entertainment content, but increasing portal staff levels overall.
Yahoo7 attracts around 5.5 million unique visitors a month, rival Ninemsn.com.au 7 million visitors and Google around 8 million.
Telecom has for years reigned supreme in the New Zealand internet portal space through the tie-up of its internet provider Xtra and Microsoft MSN, but seemed to flounder through a lack of development of the portal.
The relationship was unwound in favour of the Yahoo deal, though Microsoft's free Hotmail webmail service has a stronger following locally than Yahoo Mail and Microsoft has revamped its web services with the Windows Live platform.
Yahoo7's foray into TV downloads to mobile phones may be another obvious area of common interest for Telecom, and Yahoo has been busy signing search deals with mobile operators around the world.
Yahoo's internet search will be a priority for the parties to the deal, as advertising from search-result listings generate the bulk of Yahoo7's revenue.
Australian internet advertising recently passed the billion-dollar mark. Up-to-date figures for New Zealand are hard to come by, with the Advertising Standards Authority measuring the market value for 2005 at $44 million.