• by Gavin O'Malley  @mp_gavin, May 8, 2006

America Online last week announced plans to bolster its AIM service before June with free local phone numbers for users. Also, later this month, AOL will debut a blogging/networking service named AIM Pages, which is seen as its answer to the MySpace juggernaut.

AOL's AIM and its rival's instant messaging tools--Google Talk, Yahoo Messenger, and MSN Messenger--are already VoIP-compatible, but only AOL's new AIM Phoneline service gives users with a free phone number. Users of EBay's Skype VoIP service, for example, are charged about $4 per month for local phone numbers.

AOL's new service is still restricted to incoming calls, however, so for unlimited calls to and from anywhere in the United States and 30 other countries, AOL is offering AIM Phoneline Unlimited for $14.95 per month.

AIM Phoneline calls must be made with a headset connected to a user's broadband-ready computer, but the service offers a feature that enables users to receive notifications via cell phone of new voicemail messages.

While AOL AIM remains the most popular instant massager, its popularity is waning. According to Nielsen//NetRatings, AIM usage declined by 13 percent to 47.6 million users from March 2005 to March 2006. AIM controls 38 percent of the IM market, followed by Yahoo and Microsoft, according to comScore Networks.

Separately, AOL on Friday said it was working with Wilderness Media & Entertainment and Instinct Publishing for the launch of a free 24-hour music and lifestyle radio station for the gay and lesbian community on the AOL Radio Network. The station, "Radio With A Twist," is already available to over 60 million listeners through distribution on local U.S. radio stations.

AOL's first-quarter revenue increased by 26 percent, or $81 million, over the same period last year. Overall, however, AOL revenue dropped to $1.98 billion from $2.13 billion, largely as a result of subscribers fleeing dial-up for broadband plans. As of the end of March, AOL counted just 18.6 million U.S. members, down from 21.7 million at the end of March 2005.