Netscape Communications Corp. is expected to announce Wednesday that it has acquired NewHoo Community Directory Project, a directory-service startup that relies on thousands of volunteer editors, to help build out the directory on its Netcenter Web site.
Netcenter currently uses Web listings provided by competitor Excite Inc. Netscape (Nasdaq:NSCP) says the NewHoo directory will become its main database of Web sites within six months.
"The directory will serve as a foundation for Netscape's SmartBrowsing and other services, giving users the ability to search for things on the Web from the client," said Dave Beckwith, director of search and navigation at Netcenter. "NewHoo fits in well with Netscape's objective, to build out the largest, most comprehensive directory on the Web."
Financial terms of the deal were not disclosed.
Netscape is in the midst of building out its popular Web site, Netcenter, into a service that can compete with such companies as Yahoo! Inc. (Nasdaq:YHOO), Santa Clara, Calif., and Excite (Nasdaq:XCIT) in Redwood City, Calif.
The company characterized the acquisition as a way to quickly acquire a full-featured directory service for Netcenter. The directory is a central part of Netcenter, and is also integral to the search functions of Netscape's popular Navigator browser.
Netscape Open Directory, the new name for NewHoo, will be available in about a month, Netscape said.
In keeping with the non-commercial nature of NewHoo, Netscape will continue to offer an ad-free version of Open Directory on Mozilla.org, a Netscape technology clearinghouse.
NewHoo says it has accumulated listings of more than 100,000 sites since it was founded in June, entirely through the efforts of 4,500 volunteers throughout the 50 U.S. states and 229 countries.
"The only model that really can scale with the growth of the Web is one that relies on the Web itself," said Chris Tolles, co-founder of NewHoo and now senior product line manager for Open Directory. "Any new user that comes onto the Web is a potential editor. No closed directory, even with a paid staff, can keep up with the Web's growth."
NewHoo's database barely scratches the surface of the Web as a whole, but hand-reviewed listings are considered more valuable than the software-generated listings generated by the most comprehensive search engines. (Inktomi Corp., for example, says it catalogues over 110 million sites.)
Similar to competitors
NewHoo's method is similar to the listings available on Yahoo! Inc.'s Internet hub, but the startup says its model for growth is far more scalable than Yahoo!'s, and argues Netscape Open Directory will have fresher content and fewer dead links.
The NewHoo staff, formerly without an office, has already been moved onto the Netscape campus, representatives said.
The directory service said it selects about one in three of those who apply to become editors, based on whether they have anything to contribute to the site.
"Some editors add a few sites and then go away," said Rich Skrenta, CEO and co-founder of NewHoo, who is now the engineering lead on Open Directory. "Others come and become really great editors, they improve the site, reorganize the links in response to public inquiries.
"A very small number are malicious editors, who just come on to add their own site and label it 'cool,'" Skrenta added. "But the review process catches them pretty quickly."