Major newspaper publishers invest $12 million in Silicon Valley digital news startup Ongo

News startup Ongo gets $12M from publishers

NEW YORK — Some of the country’s most prominent newspaper companies are investing in a Silicon Valley online news venture called Ongo Inc., but are offering few details about the company.

Ongo said Wednesday that the corporate parents of The New York Times, The Washington Post and USA Today have invested $4 million each and contributed members to the company’s board.

The Cupertino, Calif.-based company says it is building a service for reading and sharing news from different sources that will launch next year at www.Ongo.com. Its founder and CEO, former e-Bay executive Alex Kazim, said Ongo will “reflect the many ways consumers prefer to read, organize and share digital news.”

Neither the company nor the publishers would give more specifics about what exactly Ongo will do.

Nor is it clear why traditional publishers have taken an interest. They have had an uneven relationship with many of the blogs and websites that post and link to their material online. Just last week, former Washington Post Editor Leonard Downie Jr. referred to news aggregation sites like The Huffington Post as “parasites living off journalism produced by others.”

Publishers are looking at a variety of strategies for making more money online as revenue from traditional print advertising declines. They are putting more of their offerings on mobile gadgets such as Apple Inc.’s iPad. Some, including The New York Times, plan on charging readers to view some material on their websites.

New York Times Co. spokeswoman Abbe Serphos said the publishers investing in Ongo have been talking with the company for more than a year, though it was officially incorporated only in April.

“We see Ongo as a smart way to work with other news and information providers,” she said, declining to give further details.

Washington Post Co. spokeswoman Rima Calderon said, “We’re interested in experimenting with different ways to experience digital news and information.”

And Robin Pence, a spokeswoman for USA Today publisher Gannett Co., said “It’s an opportunity to work with two very high-quality media partners and an excellent and experienced technology group.”

Hulu.com offers a possible model of old-media cooperation in the digital world. Rival TV networks NBC, ABC and Fox pool their shows for viewing on the site rather than focusing on their own websites.

Whatever shape Ongo takes, the publishers are gaining some measure of influence through seats on the company’s board. The Times Co.’s Martin Nisenholtz, senior vice president for digital operations, will serve as a director along with Washington Post Co. Chief Digital Officer Vijay Ravindran and Gannett’s head of digital operations, Jack Williams.

The other three members of Ongo’s board all come from eBay. Kazim, the founder, spent nine years at the company and helped run its Skype division.