3 newspaper companies buy majority of Topix.net
By Michael Bazeley
Three of the nation's largest newspaper companies, including the parent company of the Mercury News, have collectively purchased a majority ownership stake in Topix.net, a Palo Alto news search company that aggregates headlines from tens of thousands of Web sites.
Knight Ridder, Gannett and Tribune each acquired 25 percent of Topix in the deal, which closed last week. The Topix founders hold the remaining 25 percent.
The companies did not disclose the terms of the deal, but a Tribune executive described the investment as ``modest.''
Topix scans the Web and groups together headlines by topic or geography. Users can enter a ZIP code or a subject of interest, such as opera, and be presented with pages of related news headlines from various sources.
The deal is a significant boost for the small but growing Internet start-up, which officially launched its Web site a year ago and competes with Google News, a general news search site.
The investments also underscore the newspaper industry's desire to tap new distribution channels, such as Internet search engines, for its news content and advertising.
Knight Ridder, which owns the Mercury News and 30 other daily newspapers as well as their related Web sites, said the deal gives the San Jose company another outlet to deliver its information to readers.
``Consumers go to the Web and they start with search. And through search, they end up finding the content -- whether it's news or classifieds or information -- that they're looking for,'' said Hilary Schneider, Knight Ridder's senior vice president for news. ``This just gives us another channel to expand our distribution.''
Topix makes money through advertising on its site and by distributing its local news feeds through sites such as CitySearch and Ask Jeeves. Self-funded, the company recently began earning a profit.
Topix Chief Executive Rich Skrenta said users should not notice any significant changes at the site, and Topix won't begin favoring news stories from the three newspaper companies.
``There's a lot of structure to keep us editorially independent,'' Skrenta said.
Knight Ridder, Gannett and Tribune are already partners in several other online ventures, including CareerBuilder.com, Cars.com and ShopLocal.
The new partnership benefits Topix because it will be able to distribute its brand across the three newspaper companies' 140 Web sites.
Skrenta said he also envisions being able to match content from the companies' classified-ad sites to news stories on Topix. A Topix page that focused on nursing, for example, could feature CareerBuilder listings for nursing jobs, he said. Skrenta also said that content from newspapers' print editions, such as real estate transactions, would fit well on the Topix site.
Topix offers the newspaper companies a new distribution channel for advertising as well as a way to drive more traffic to the CareerBuilder, Cars.com and ShopLocal ad sites. Schneider said local news Web sites such as MercuryNews.com could also augment their news stories by offering links back to topical pages on the Topix site.
``The Internet at every turn is about building scale and the ability to do things at an international and national level, but also at the local level,'' said Tim Landon, president of Tribune Interactive and Classifieds. ``And that's what the intriguing potential is for Topix.''
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