Yahoo has announced that it acquired Xoopit, a photo sharing and organization tool compatible with Yahoo Mail among other Internet services. While the search-giant has not officially disclosed any financial details of the transaction, several reports are quoting an inside source who says the deal was worth $20 million.

By using Xoopit’s technology, Yahoo hopes to introduce easier methods of sending photos and sharing albums with friends and family. Of the other Web services compatible with Xoopit is the email service of Yahoo’s greatest rival, Google. Yahoo is denying new Gmail registrations, and in the spirit of competition, they’ll continue support for open accounts – for now.

Between their talks with Microsoft and their new front page design – which hasn’t impressed me, frankly – Yahoo is taking some big strides to try and regain foothold in the search market. In the recently closed quarter, Yahoo posted a 13% loss in revenue year over year.