March 23, 2005
Newspaper Giants Buy Web News Monitor By KATHARINE Q. SEELYE NY Times
http://www.nytimes.com/2005/03/23/business/media/23topics.html?pagewanted=print&position=
Three of the nation's biggest newspaper publishers, the Gannett Company, Knight-Ridder Inc. and the Tribune Company, are joining forces to buy three-fourths of Topix.net, a Web site that monitors more than 10,000 online news sources.
Each publisher will own 25 percent of the company. Topix.net, based in Palo Alto, Calif., will retain the rest and continue to run the site. The cost of the acquisition, which is scheduled to be announced today, was not disclosed.
Topix.net is a news aggregator, continuously monitoring updates on thousands of news media Web sites as well as government sites and organizing links to articles in more than 300,000 subject areas. Topix.net already keeps track of news from sites operated by Gannett, Knight-Ridder and Tribune, but the acquisition will allow it to approach the newspapers' online advertisers about using its technology for customizing ads. It will also let Topix.net add material like television listings.
Rich Skrenta, chief executive and a co-founder of Topix.net, said that in exchange, the newspapers' Web sites would get more fine-tuned technology and a better way to show their readers "the ads that they actually want to see."
"They get powerful contextual advertising technology, and we make their ads more profitable," Mr. Skrenta said, referring to what he said was Topix.net's ability to place relevant ads next to articles. He also said the newspaper companies, which collectively operate more than 140 newspaper Web sites with nearly 30 million unique visitors a month, would direct more readers to Topix.net.
The three news publishers have joined together for two other online projects, ShopLocal.com and CareerBuilder.com, and they have joint ventures with other companies in Web sites like Cars.com and Apartments.com.
The Topix.net deal is the latest in a series of recent acquisitions of Web ventures by newspaper companies that are, in one way or another, attempting to broaden their reach and profit from strong growth in online advertising. They include the purchase of MarketWatch by Dow Jones & Company, the purchase of About.com by The New York Times Company and the acquisition of the online magazine Slate by The Washington Post Company.
"We're already in the online business," said Hilary A. Schneider, a senior vice president of Knight-Ridder. "We look at this as an enhancement that extends our distribution network."
Ms. Schneider said she did not view Gannett and the Tribune Company as competition, per se, but as partners in "establishing a national footprint."
"Our unique advantage will be about the local customers we serve," she said, "but having national scale and a national brand is a very effective way to go to market in the online arena."
Tim Landon, president of the Tribune Company's interactive and classifieds unit, said in a statement that the investment in Topix.net would allow the three newspaper companies to "further extend both our news and classified businesses" and "make both our local and national Web sites more valuable to customers."
Chris Tolles, vice president of marketing for Topix.net, said the Web site was able to offer highly localized news to readers across the country by providing information not only from local newspapers but also from government Web sites, local television, police blotters, trade magazines and other sources.
"The newspaper business is looking out for its future and is more savvy than people give it credit for," Mr. Tolles said.
================================ George Antunes, Political Science Dept University of Houston; Houston, TX 77204 Voice: 713-743-3923 Fax: 713-743-3927 antunes at uh dot edu
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